5 Post-COVID Supply Chain Trends To Look Out For

PartRunner
4 min readJun 23, 2021

Greg Bernier, June 26, 2021

In the modern globalized economy, COVID remains a massive issue that most of the world has yet to overcome fully. It has disrupted our lives in many ways, but one of the most important disruptions has been in the form of the supply chains our economies have been built around. As COVID exposed major weaknesses in the supply chain, and as the demand for goods is outstripping the availability a COVID-stricken supply chain can provide, multiple cultural, technological, and financial changes are occurring within the industry to better a worldwide economy emerging from COVID and help prevent similar supply chain mishaps in the future.

  1. Increases in reshoring of production
    Pre-COVID data showed trends that noted the offshoring of goods to other countries with cheaper labor might actually be more expensive in the long run for various reasons, including unacceptable quality of goods, time, shipping costs, and energy usage. In the midst of the pandemic, all of the problems associated with the offshoring of manufacturing became further exacerbated. It also exposed other critical flaws in the supply chain, including the heavy reliance on goods from other countries and even further reliance on other key aspects, such as boats being heavily used to transport most goods, failing as a result of COVID’s effects. The effects of an international supply chain failing as a result of COVID have let many countries, particularly the United States, further develop their domestic supply chains, as in the long run it might be cheaper than using an international supply chain. As a result, domestic supply chains will become more developed and able to adapt to changes in the economy much better than an international supply chain would. Domestic supply chains are also much more flexible in supplier choice, methods of transport, and deliverables, and are much easier to compare and contrast than some international firms.
  2. Further outsourcing of various production aspects
    In addition to changes in the supply chains, and a switch from more international to more domestic production and manufacturing, more and more manufacturers are outsourcing aspects of their process to other suppliers who can perform the actions better, faster, and cheaper. In a world where specialization and efficiency make you the best company and quite profitable as well, many suppliers have come up to help bigger companies manufacture goods for lower prices as a result of the changes in process development. As time progresses onwards, more aspects of this change in the outsourcing of labor as a part of process development will affect other aspects of business, notably in the service sector.
  3. Pushes for supply chain principles to apply more in the service sector
    As a push for outsourcing occurs with changes in the supply chain, inevitably this is going to be targeted more and more towards the service sector, with parts of the business such as advisory and tax services, IT, HR, finance, and logistics. The push for changes in the service sector has largely been put in by the push for more workers to stay home as a result of the pandemic, and the usage of more technology to optimize services. With the push for goods to become cheaper and easier to acquire becoming apparent, the service sector will likely be given a similar challenge.
  4. Greater demand for forecasting and optimization
    Forecasting systems are outdated for many companies and have not been designed to handle major changes in supply and demand the way COVID has done. Forecasting systems, with COVID, now have an abundance of data on the behaviors of individuals, companies, and organizations during crises and changes with the supply chain as a result of these changes behaviors. As supply chains consolidate and the power of technology increases, forecasting will become much more reliable with the new data and can be used in such a way to help optimize in ways that were not otherwise possible.
  5. Technological improvements in transport
    Despite shortages in certain technological components, particularly semiconductors, technology for alternative forms of transport has been advancing at an exponential rate. The supply chain issues that occurred as a result of COVID showed notable shortages in pilots, captains, and truckers to supply an increasing number of goods. As a result, many companies are trying to develop autonomous and more sustainable forms of transport in the wake of COVID. These include autonomous trucks, planes, and trains, said transport systems fueled by renewables, and even space travel. The limit to which these technologies could expand is limitless, and it will bring about probably the most exciting and noteworthy changes in the supply chain for the future.

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