icon26 Jan, 2023
Winter is Here. Is Your Supply Chain Prepared?
Winter can be tricky in the supply chain. It’s often simultaneously the busiest time of year and, in many locations, the most likely season for disaster to strike. In one tiny window of time in December of 2022, more than 10 million packages were delayed, missing that critical Christmas Eve deadline. These delays were due to a combination of bad weather and tight capacity conditions due to high volume.
Obviously, we can’t prepare for everything. No one has a crystal ball but armed with great forecasts (both of the volume/capacity variety and the weather) and resilient practices, companies can insulate their supply chain against winter’s woes.
How Does Winter Affect the Supply Chain?
To understand how to prepare your supply chain for winter, we first need to understand how winter affects supply chains.
Winter Slows Down Supply Chains
Supply chains tend to slow down in the winter. High volume means capacity is more difficult to come by, often delaying shipments when there’s no truck (or plane) available to get them where they need to go. Many companies shut down for one or more of the many winter holidays. This creates a backlog of orders and potential shipping delays.
Old Man Winter can also play a role in slower-moving supply chains during the winter. Winter weather creates treacherous driving conditions that make driving slow going, makes it difficult for warehouses to move trailers around so they can keep operations humming, and sometimes shuts down airports and highways to stop the movement of goods altogether. Just this December, countless highway shutdowns like this one in Texas delayed trucks.
It Can Be More Costly to Move Goods During the Winter
Because volume tends to be high during the first part of winter, capacity is scarce. When capacity is thin on the ground, spot rates tend to go up. While capacity wasn’t as big an issue in 2022 as it usually is, most years bring with them higher spot rates through the winter.
Diesel fuel prices also tend to rise during the winter. We can look at December 2022 as a representation of rising fuel costs in the winter. Despite diesel prices that were trending steadily downward in previous weeks, data from late December showed that oil inventories were down and crude oil prices were ticking upwards.
With rates and fuel prices up during the winter, the total cost of transportation can be markedly higher over the winter months, especially during peak volume. On a global scale, higher volumes tend to last not just through the Christmas shopping season, but on through mid to late January for Lunar New Year.
Winter Holidays Lead to Increased Volume When It’s Hardest to Move Goods
Often, the most detrimental supply chain disruptions that occur during the winter are due to a combination of increased volume and weather-related delays.
Peak volume brings about its own set of issues, including:
- Warehousing space shortages
- Decreased trucking volume
- Longer lead times from suppliers; they’re busy, too!
When you add in delays due to icy or snowy weather, it can seem impossible to maintain resiliency during the winter.
5 Tips for Building a Winter-Ready, Resilient Supply Chain
What can you do to prepare your supply chain for winter? Here are some tips that can help you keep your supply chain ahead of the curve.
Tip #1: Keep an Eye on the Weather Forecast
We can’t control the weather, but we can prepare for it. Keep an eye on the long-range forecast during the harsh winter months. Use that information to prepare.
Keep in mind that it’s safer to air on the side of caution when you’re adjusting plans due to winter weather. While meteorology has come a long way in the past several decades, weather predictions are still notoriously inaccurate, especially when you’re looking at weather more than a week out in a small geographical area.
Tip #2: Plan Ahead
If there’s any way you can swing it, plan ahead by increasing inventory a little for the winter. You can order a little earlier than you normally would or increase the size of your orders to stock up a bit. This will help account for closures at suppliers or shipments delayed due to weather.
If you’re in e-Commerce or retail goods, winter is the right time to give yourself a little wiggle room on delivery. Get orders to retailers early if possible, and don’t balk at paying a driver a layover to ensure they’ve got time to deliver your shipment on time. If you set a ‘Guaranteed Delivery by Christmas’ date, leave an extra day to ensure customers get their products on time.
Planning ahead can help you get your products where they need to go on time, offering your customers, whether that’s a retailer or shoppers at home, a positive experience.
Tip #3: Keep Your Freight Protected
Some goods don’t do well in the frigid cold. If the forecast is looking freezy and your cargo might be sensitive to sub-zero temperatures, consider temperature-controlled shipping methods to ensure your products aren’t harmed.
The risk of trucking accidents that could damage freight is heightened during the winter, especially during winter storms. Winter is an ideal time to check over insurance policies and examine each of your carriers’ and brokers’ policies carefully.
Tip #4: Create Contingencies
When the odds are increased that everything won’t go exactly as planned, as is often the case during the winter, it’s a great idea to have a Plan B. And maybe even a Plan C and Plan D. Make backup plans for your backup plans.
This could come in the form of building up your carrier network to ensure you’ve got capacity or diversifying your shipping methods (pulling in regional or local carriers, or employing air freight services, for example). It could also mean ensuring your warehouse is ready to weather a storm (ice melt a-plenty).
Tip #5: Lean on Experts When It Makes Sense
Transportation and logistics can be complicated, and the additional complications that winter presents can make navigating the supply chain even more difficult. Thankfully, there are plenty of experts that can help you get through the tough winter months.
If you can’t find capacity, or you’re struggling to control transportation and logistics costs, or you simply don’t have the resources to handle the increased volume over the peak season and beyond, 3PLs like NEWL and other service providers are there to help.
How Can a 3PL Help Prepare Your Supply Chain for Winter?
3PLs can help companies stay on top of their supply chain during the winter. They do this by giving shippers access to more capacity they can trust, providing warehouse services like e-Commerce order fulfillment and reverse logistics, and helping them develop strategies that nurture supply chain resilience.
If you need help getting through this winter or preparing for the next, reach out to the team at NEWL. We offer tailored service options to meet each client’s needs, and our team has special expertise in making supply chains run, even during the harsh winter months.
You can get in touch with our team here.