A logistics historian would have another illustrative yet shocking story to account for the year 2022. It has shown signs of being challenging and volatile as the previous two years. Starting with another COVID variant (Omicron) and almost closing with the ongoing Russia-Ukraine conflict – risk and uncertainty remained high.
Amidst these, businesses are wrestling with an economic downturn that has slowed growth tangibly and hinted at record inflation. Nonetheless, companies will figure their way out and thrive – but the most efficient will be the ones who will weather the 2023 trends. Here is our POV:
Geopolitics
While it is impossible to foretell the outcome of the Russia-Ukraine conflict and US-China trade war – but for one thing, today’s globalized supply chains have to take the heat. Logistics personnel must stay ahead of any tariffs, sanctions, or whatever is caused by these upheavals.
As political instability keeps weighing on the goods flow ability, one resulting factor continues surfacing more. Politics has shaped logistics, changing routes, border protocols, brokerages, etc. So regardless of your engagement in international import/export, your trade will face an indirect impact, and these issues will intersect with each other to create more trouble.
Onshoring and nearshoring trends in 2023
Supply chain issues encountered during the pandemic and changes in the global political climate have prompted manufacturers to seek closer manufacturing facilities. Onshoring and nearshoring of manufacturing are very likely to continue beyond 2023.
These fresh strategies could fundamentally turn the logistics market on its head. As businesses bring their supply chains closer to home and cut short on international collaborations – it might signal new opportunities.
Green supply chain
Consumer demand for environmentally friendly and sustainably produced goods is already driving multiple strategies in the manufacturing and product design industries.
New world shifts expected throughout 2023 will promote more sustainable and environmentally friendly practices. It will include adapting to e-vehicles for last-mile deliveries, more solar-powered warehouses, and circular supply chains.
Deep tech facelift
Advanced asset control, futuristic track-and-trace, and product health management through IoT breakthroughs and AI will disrupt logistics. Companies fast enough to catch the wind will quickly and efficiently implement new supply chain technology solutions. To this end, it is essential to have an accurate grasp of industry trends, just as the logistics industry is advancing rapidly in technology.
After that, there may be an increase in carriers dealing with 3/4/5 PLs. Interestingly it lets you leverage the latest technology platforms and other new supply chain tools without a huge upfront investment.
Cybersecurity
Any proliferation of technology relieves chronic headaches but also opens the gates for potential cyberattacks. Modern firms are beefing up: deploying new-age mechanisms, sensationalizing employees about data, or consulting white-collared cyber experts.
New regulations
With UAE’s stellar growth, the government might impose new taxes and regulate the market more tightly. A remarkable change could be implementing a carbon tax, which might inflate the freight services cost in the country. Or introducing new regulations like mandating or increasing the use of electric vehicles and autonomous trucks for green logistics.
Also, news surfaced that new rules might define the amount of freight movement within and outside the region. Safety standards for shipping could be another aspect. Combined, all this will make it a fierce battleground for the players, which could swell the pricing.