It’s no surprise from what we’ve seen in the news recently that the most recent shock to the supply chain is rapidly escalating ocean rates. As recently as a year ago rates were $3,000 per container. This past week, Hapag Lloyd announced a $3,000 increase on top of base rates between $8,000 and $12,000.

This isn’t just any inflation — this is a 500% inflation in less than a year!

And not only that...but these shocks just keep coming. As shocking as this price escalation is, it comes on the heels of many other massive shocks including trade wars, tariff increases, trade tensions, sourcing shifts, a pandemic, container shortages, and rising raw material costs.

How much more can importers take?

Importing is hard enough on a great day. A typical purchase order can take an average of four months from start to finish, involves custom manufacturing, seven different entities (such as the supplier, factory, inspector, and more), governmental oversight on both sides of the transaction, 30 people, and up to seven departments.

While my hands-on days of importing are in the past, the future of the supply chain needs help. If I were still an importer, I would consider the following three actions to help overcome these shocks:

1. Implement an end-to-end process review to determine where the waste is – note: I’m not talking about a logistics-only review — instead, look at the entire process from order placed to order received.
2. A supplier relationship management tool to connect directly with my products
3. An end-to-end visibility and workflow solution to automate as much of the process as possible

If you think about it, in some ways, this is not different from what companies were forced to go through recently to support their eCommerce initiatives. When the pandemic hit, stores were pretty much nonexistent, and there was a huge shift toward consumers purchasing online. Ultimately forcing companies to react to the shock of the pandemic and shift their actions to overcome this new explosion of eCommerce traffic.

The shocks aren’t ending anytime soon though. It’s important to make sure you’re prepared instead of catching up.