Supply Chain Trends to Watch for 2023 and Beyond


As a result of the global Covid pandemic and the Russian invasion of Ukraine, businesses have faced great challenges and have undergone incredible changes over the last few years. Increases in fuel, disruptions in supply chain and rising labor costs have severely impacted business’ margins. In addition, an increasing inflation cycle in recent years has contributed even more to this situation and thus stagflation has been felt painfully. These factors have greatly influenced both business and consumer behavior and seem poised to continue to do so.

Due to all these negative effects, businesses had to keep up with the changes in the world economy in order to survive. Returning to normal until the end of 2023 and beyond is not expected. On the contrary, companies need to make this current situation sustainable as technologies are developing faster than ever. Various factors will continue to influence Supply Chain Management trends in 2023 and beyond.  To better prepare for whatever new year may bring along with it, we have put together a list of three top supply chain challenges.

1. Increasing Supply Chain and Delivery Costs

Inflationary trends are affecting the world economy and directly affect supply chain and delivery operations. After a couple years of sky-high trucking rates and tight capacity, the U.S. trucking market is finally softening. Less consumer spending combined with higher delivery costs is most damaging to retailers’ profits. Today, less demand for truck capacity results in lower trucking rates. Until first quarter of 2023, trucking costs are believed to remain stable or fall further, but this is only a forecast and subject to change.

Retailers, in particular, must take advantage of today’s lower costs while building the flexibility needed to deal with uncertainty. Businesses need to look ahead and focus on final delivery operations to increase efficiency and reduce costs. That’s why they need to leverage the latest technologies available in leading delivery management solutions, making sure their fulfillment offers are as cost-effective as possible.

2. Continuing Labor Shortages

There is a bigger issue that hasn’t been addressed. Importing all the goods from around world requires people, but there are not enough truckers to be able to complete delivery operations to customers. Leading into 2023, although a rail strike seems to be avoided for now, there are still not enough truckers to meet current or future demand. However, quality of life issues will remain an ongoing challenge for recruiting rail workers and truckers.

Warehousing is also expected to have problems providing sufficient labor to meet demand. Where capacity loosens for some, there will still be a shortage of workers to manage the influx of goods to warehouses, a shortage of truckers to move said goods in a timely manner, and a shortage for many other positions in-between.

The businesses that overcome labor challenges will be those who offer competitive wages and benefits to attract and retain good employees, while using outsourcing options to address for the shortages. Using competitive advantages with such competition for labor, expect supply chain careers to become more competitive and attractive in the market.

3. Digital Transformation

Digitalization in the logistics sector can be detailed as the simplification of the intermediate sections in product transportation to the final consumer, shortening distances and providing full and effective transportation. In logistics, a branch of the service industry, digitalization confronts the sector as one of the stages of customer satisfaction. The important point for the end customer is whether the product customers bought reaches them in a short time. Usually, every customer wants to be a priority and they want to receive their product as soon as possible. The transportation dates specified by logistics companies can sometimes have a negative impact on both the customer and the business owner during the purchasing process.

For this reason, it is very important for logistics companies to promise the most optimized service for their customers. If only the length of time in logistics affects online purchasing, this may create negative consequences for both the e-commerce company and the logistics company. Therefore, any digital process management and automation to be used must meet customer demands.

Looking forward to 2023, we can see that some issues from 2022 will continue to trend for a while and will continue to present us with challenges.

However, it is also a time of great opportunity for the supply chain and logistics industries’ move from reactive to proactive as well as from survival mode to growth mode. For those businesses who can meet with today’s challenges, there will be positive news and reasons to be optimistic for the future. In other words, all these proactive behaviors in the logistics and supply chain sectors taking advantage of these trends in 2023 will be able to improve their service, have more satisfied customers, and increase profitability when the economy reactivates. As a result, even if these recent issues seem negative and extra costly, there is always hope and growth for businesses when the right strategies are followed.