Challenges for Global Supply Chains

Global supply chain managers face an array of difficulties as the global transportation network continues to grow more complex. These global supply chain managers are faced with having to maintain inventory and custom satisfaction while keeping costs low and mitigating risk. Some of these specific challenges are as follows…


Periods of high consumer demand go hand-in-hand with constrained capacity. Some companies may have to function off of a decreased inventory during those times, while others are forced to pay higher rates and secure capacity in advance. Capacity is not only lessened by increased product demand, but it is also impacted by a variety of other factors. These factors include fuel costs, driver shortages, government regulations, and environmental challenges, which may force carriers to cut their capacity.


Since many companies are working on a low-as-possible budget, one area that they are keeping a close eye on is inventory. Having more inventory than needed is expensive in the form of warehousing costs, employee costs, and shipping costs. However, having too little inventory could be disastrous and even bring business to a halt. This is where having an efficient and transparent supply chain network is crucial – as is having a real handle on forecasting and operations.


The international market brings a myriad of other potential complications that you typically do not deal with when shipping domestically.  Global transportation involves a great amount of fuel volatility, various transportation infrastructures to navigate, security issues, changes in currency, and new regulations. Being unaware of regulations and infrastructure specifics could be costly to your company, which makes this another area where 3PLs can save you money – simply because of our expertise and knowledge in the area of global transportation.


The global supply chain is an area that benefits from constant re-evaluation. It is important to analyze each aspect of the business to improve the efficiency of the process while keeping costs low. This may involve new ways to package products. It may involve finding new storage solutions. It may involve creative consolidation solutions. And it may involve the implementation of new technology systems. Just like a business must always re-evaluate and improve the products they are selling, they must also be re-evaluating and improving their global supply chain process.