US supply chain crisis continues in 2023

America Although there are signs of recovery, the US supply chain still has many problems such as increased shipping costs, tightening spending, lack of raw materials...

The US supply chain is still recovering from the pandemic crisis. The disruptions in the supply chain have caused shipping costs to skyrocket. Consumers are also tightening their purse strings and spending more carefully.

Freight rates for land, sea and other transportation have shown signs of falling as American consumers shift their spending from big-ticket items such as furniture, BBQ grills, and large-screen TVs to travel and other leisure activities.

The supply of essential goods such as toilet paper and food is still in short supply after more than three years. In some areas, machine parts continue to be scarce.

Cement suddenly became a "rare commodity" as car manufacturers ramped up their operations. The rush to complete a series of infrastructure projects also affected the supply of construction materials.

Two trucks traveling on Fisher Highway, Detroit, Michigan (USA), March 27, 2009. Photo: Rebecca Cook — Two trucks traveling on Fisher Highway, Detroit, Michigan (USA), March 27, 2009. Photo: *Rebecca Cook*

Dean Croke, an analyst at DAT Freight and Analytics, a transportation data provider, said the U.S. supply chain is still going through a period of uncertainty. To find solutions to these issues, experts from Walmart, Colgate-Palmolive, Toyota and other companies will discuss strategies at a conference organized by Reuters in Chicago (USA) on May 24-25.

Business leaders also made many comments before the conference. Specifically, Joe Hinrichs - CEO of railroad company CSX Corp said some US industries are going down, while others are still growing strongly.

“The road and rail supply chain is a fragile sector and is showing signs of weakness, while the retail sector of cars, coal and building materials is growing strongly,” said Joe Hinrichs.

Alan Amling, a fellow at the University of Tennessee’s Global Supply Chain Institute, said that after investing in solutions to connect the supply chain of essential goods to meet demand during the pandemic, business leaders in this industry changed their strategy. To preserve profits, they turned to tightening spending, cutting unnecessary expenses as much as possible.

Target, for example, aims to cut store shipping costs by establishing local consolidation centers. Once an order is placed, delivery trucks pick up inventory from local stores, package it on site, and deliver it to the buyer. This reduces labor costs, shipping distances, and packaging materials.

Despite tightening their purse strings, these businesses are still willing to invest in technology platforms. Automated operations, process tracking, robotic monitoring of operations, and artificial intelligence (AI) are still being utilized to improve efficiency.

Can Y (According to Reuters )

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