The impact of the global pandemic, COVID19, has largely been disruptive. It is exacting a terrible human toll and menacing the world economy. The logistics industry is no stranger to the havoc. It is the industry responsible for producing, obtaining and distributing products and goods to the right place in the appropriate quantities. It uses the process of planning, controlling and implementing procedures for the efficient storage and transportation of goods, right from the point of source to consumption.
Post COVID Analysis
The Logistics industry has taken a major hit in its growth projection due to the pandemic. According to the report “COVID-19 Impact on Logistics & Supply Chain Industry Market by Industry Verticals (Automotive, FMCG, Healthcare, Energy & Utilities, Industrial Machinery & Equipment), Mode of Transport (Roadways, Railways, Airways, Maritime), Region – Global Forecast to 2021”, COVID-19 impact on logistics & supply chain industry market is worth $3,215 billion in 2021. The 60-page report states that post COVID-19, the global logistics market size is projected to grow at a Y-O-Y (year over year) growth of 17.6% from 2020 to 2021, to reach USD 3,215 billion in 2021 from USD 2,734 billion in 2020. The projection for 2021 is estimated to be down by over 10-15% as compared to pre-COVID-19 estimation. The projection for 2021 is estimated to be down by over 10-15% as compared to pre-COVID-19 estimation.
The major drivers of this market are growing supply of essential commodities, formation of supply chain stabilization task force to fight COVID-19, and rising demand and distribution of personal protective equipment.
Logistics emergency in India
In their latest report, “The Covid-19 War: How India can win faster leveraging its supply chains and logistics?” LogisticsNow, the logistics intelligence platform, shared insights on the current scenario of the logistics sector in India. It recommended building digital supply chains using AI (artificial intelligence) and enabling digital payments as the solution to deal with emergencies such as COVID-19 pandemic. It predicts a timeline of at least 1-2 months for the industry to recover post lifting of the lockdown, which could be longer if action is not taken immediately. The highlights of the report are:
- 50% + of India’s (organized long haul) trucking fleet is stranded without drivers.
- Local (short haul) transport, though less impacted, is working with reduced capacities.
- Trucks (including those carrying essentials) are still stuck for reasons including want of labour to load and unload, check-posts etc.
- Railways is stepping up and can serve a few sectors, but the gap is large, with first mile and last mile being a challenge
Raj Saxena, Founder and CEO, LogisticsNow affirmed, “The logistics network nationally, from long haul to last mile, has been impacted and the lack of available logistics capacities and planning is likely to impact essential supplies and the common man, unless we act now.”
Global e-commerce logistics
The pandemic has been a shot in the arm for major e-commerce companies around the world. The biggest names in the industry, including Amazon and Walmart, have blocked all shipments of non-essential items to their warehouse as the orders for essential items have significantly increased. FedEx Corp. and Microsoft Corp. have teamed up to provide commercial shipping with early warnings of delays from weather, traffic and other mishaps, giving the courier and the software maker another weapon to compete with Amazon.com Inc. While the online sale of some products has drastically risen, others have seen a huge decline in demand. E-commerce for goods and services trade has been adversely impacted by the same factors that have caused disruption in supply and demand overall. Such disruptions have resulted in delivery delays or outright cancellation of orders.
Nonetheless, the pandemic has tested logistics services and other features of supply chains like no other event in recent history. All the frenzied activity has resulted in a huge strain being put on the E-commerce firms’ supply chain thereby resulting in shipment delays, technical problems, and also labour shortages. Logistics now hold a more vital position than ever for E-commerce firms. In these challenging times, logistics can make or break customer satisfaction.
Remedies
Advanced technologies need to be put to use to combat the challenges posed by the pandemic. India created the India stack for payments, ensuing digital payments revolution unparalleled in our history. A similar digital logistics revolution based on the “logistics stack” is required in our supply chains and transportation to power our supply chains with intelligence, visibility and agility. As a majority of payments become online, the data generated, in sync with CIS and Digital Supply Chains, will be a critical part to identify trends including spread of pandemics before they become evident and keep citizens safe.
Transport capacities have been disordered by stranded trucks and a lot of drivers are left without basic facilities. There is a need for thousands of trained drivers and trucks to move essential supplies. Options including the Army Supply Corps (ASC), Indian Railways, CONCOR, Freight Marketplaces, and Freight Intelligence networks along with large fleet owners/ truckers who can provide transport capacity from long haul to the last mile, need to be aligned quickly. As scientists persevere to develop a vaccine for the virus, a plan needs to be in place to ensure when it is ready to be distributed to the mass communities, transporting it to the farthest districts. An unprecedented level of planning is of utmost importance to ensure the transportation of essential commodities and to save lives.
References
https://www.itln.in/being-digital-is-the-solution-to-survive-such-logistic-emergencies-logisticsnow
https://locus.sh/resources/bulletin/coronavirus-could-be-shot-in-arm-for-ecommerce-firms-globally/
Author – Vipasha
Entrepreneurship Development Cell 
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