World oil prices hit new highs overnight. As diesel prices here continue to escalate, it’s never been more expensive to
World oil prices hit new highs overnight. As diesel prices here continue to escalate, it’s never been more expensive to move freight. And it’s only going to get worse.
Supply chain management has become a game of cost management. And it’s a game played between a rock and a hard place; basic economic reality says you can’t simply absorb rising cost inputs and basic commercial reality says you can’t expect your customers to pay for all of it.
If a chain is only as strong as its weakest link, no party can be left to struggle under economic stress. The very ethos of strong logistics networks has never been more important: transparency up and down the chain to map costs, collaboration and cooperation to identify the pressure points, optimisation to ensure efficiency and the lowest bill possible.
Fundamentally, customers must pay. Fuel levies from carriers must be honoured; screwing down rates only undercuts the competitiveness of the transport network as a whole.
But the industry must innovate to negate the impact. Development of alternative fuels and better freight scheduling must be championed. Customers must work with their logistics providers to deliver an end-to-end solution.
It’s only through collaboration that will truly optimise logistics networks. Better planning, better technology will deliver leaner supply chains, greener supply chains, and cost-competitive supply chains.
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