The Logistics Industry’s Impact Globally in the Modern World

As we have embarked on the journey to understand the logistics industry, we began by reflecting upon the history and modern logistics, let's take a sneak peek to see The Logistics Industry’s impact Globally in the modern world.
The 21st century has allowed companies to spread their offerings and supply chain over the world, creating jobs, developing infrastructure and contributing to GDPs have been a few of the positives brought on by the growth of the boosting logistics sector. The below figure, depicts the contribution of the logistics sector of different countries to the national GDPs, as the figure depicts, the global average contribution of the logistics industry is about 13-15% of global GDP.

While sector’s contribution to GDP is astronomically high in few countries, owing to the undeveloped infrastructure and facilities, an industry worth $5,000 billion globally presents unbelievable opportunities for the industry to create efficient supply chains and creating a massive impact on costings globally. With the ever-rising customer demand, the creation of efficient supply chains becomes even more essential for corporations to address, as it would allow in wider distribution of products at a much-marginalized cost.

The countries wherein the contribution of logistics have been minor to the GDP have been the ones who have had been able to take advantage of technological advances and have worked towards the advancement of the logistics sector. Countries like US and countries in the European region have also been benefited largely with the presence of advanced infrastructure and have set a precedent to the developing nations that can be achieved with advanced infrastructure.

Looking at the trends and the future possibilities logistics sector is on turnaround for major global changes with globe becoming smaller day by day, the impact which advancements in the field of logistics can have are immense.


Things to Consider for a Successful Shipment

Shipping cargo from one place to another can be a very big task and usually involves millions of dollars. Therefore, in order to have a smooth operation, it is very important to have a proper plan in place to avoid any unnecessary hassles. Perhaps the most important part of the plan is to choose the right logistics partner as they will not only transport the cargo from one place to another but make sure it is done within time and with utmost care.

When choosing a logistics partner, it is important to seek out a company that has sufficient experience in handling large amounts of cargo. Since handling such assignments require a lot of calculation and different transportation partners specialized for different types of cargo, and only large companies with financial stability and experience can smoothly run such operations on a daily basis.

Another factor to consider is incoterms, which contain the commercial agreement that specifies who is in charge of the care and custody of a shipment, transportation costs, transfer of ownership, risks involved, etc.

A major part of export and import include duties and taxes. Even though it varies who is going to be responsible for the payment of duties and taxes, it is very important to clear out such details while planning the shipment.

Once the plan is set, it is also very important to determine who is in charge of what activity and make sure they have the authority to complete them as certain tasks can only be completed by people who are authorized to do them.

Having a primary contact person is also crucial in having a successful shipment. While the process is ongoing, things might go wrong or be delayed. In situations like these, having a primary contact person to keep you updated will only increase the chances of a successful shipment.

Therefore, before shipping any sort of cargo, make sure to evaluate all the factors involved and choose a partner suitable for you.


The Impact of Corona Virus, So Far

In the Coronavirus epidemic (a global health emergency declared by WHO) China, the logistics hub of the world has been the most affected amongst all its major competitors.

The virus started spreading from the city of Wuhan towards the end of 2019 and by the end of January, citywide quarantine and strict transport restrictions had been placed in various parts of China in an attempt to stop the spread of the virus.

China has some of the world’s biggest and newest seaports apart from having one of the biggest manufacturing industries in the world. But due to the roadblocks, quarantines, and factory closings, severe disruption is being caused to inbound and outbound air cargo shipments, trucking, and rail cargo services, as well as heavy port congestion for vessels along the Yangtze River.

The world’s biggest container line Maersk, has already stated that this global epidemic is likely to cause a hit in their earnings this year as there aren’t enough workers at the ports to move the containers around, not enough truck drivers to move the goods, and no one to receive them at the factories or warehouses. A lot of ships are also laying idle in Asia, as they had to cancel many loadings out of China.

This world health emergency crisis has greatly affected the Chinese manufacturing and export industry. According to Reuters, many fashion retailers have already started to switch to Turkish, Bangladeshi and Vietnamese firms with orders being worth up to $2 Billion.

At a time like this, supply chain managers across the world are racing against time to evaluate the impact of Coronavirus and how to deal with it. Although the long term consequence is yet to fully play out, companies are already working on contingency plans to deal with this global crisis. On a positive note, things are slowly improving as in terms of land transport, 45% of logistics parks in mainland china have reopened. But, the capacity still remains low. It is believed that although the Coronavirus epidemic might impact the global economy in 2020, it will eventually bounce back to its former state.
