Why 2023 will be about stepping out of survival mode

Anthony Beavis, Managing Director at Körber Supply Chain ANZ, discusses key trends he expects the industry will see in 2023.

While there are still businesses operating in Covid-19 survival mode, in 2023, we need to move on from that way of thinking and take our supply chains forward.

The last few years have shown how fragile the global supply chain can be. And, while the supply chain isn’t fixed, nor is it close to being ‘back to normal’, compared to 12 months ago we are in a considerably better position than what we experienced at the height of the pandemic.

Post-Covid-19 we realise that the consumer drives everything. From the push for greener supply chains, to retail events that are changing the definition of “peak”, the need for a flexible, agile supply chain is forcing businesses to step out of survival mode and build an innovative and connected supply chain to guarantee growth in our ever-changing world.

Driven by e-commerce and social distancing measures, the pandemic forced retailers to prepare their business for our “new normal".

Growth mode: On

To cope with peak pressures and the increasing demand on our supply chains, we are seeing many operators mature their approach to how they adopt technologies. One of the biggest takeaways we will see in 2023 and beyond - certainly from the big corporations – is that there will be a longer, wider view of the technology they are embracing and how that impacts their entire business.

Pre-pandemic, automation was the flavour of the month for many years. However, any big plans were put on hold as we reacted to cope with the strains of the pandemic. During this time, supply chains were forced to implement technology systems out of necessity, as social distancing measures impacted staff levels and demand levels soared.

As we look to switch back to growth mode, supply chains will need to approach the way they implement technology differently. “That’ll do” will no longer work. Moving forward, we must understand that our technology systems must be an end-to-end solution.

We’re in this together

Having good data to better predict the future goes hand-in-hand with making your supply chain increasingly more connected. From your inventory management system to freight forwarding planning, connecting all of your systems inside and outside of the warehouse will provide clarity and knowledge of every aspect of the supply chain to help you plan and prepare for the unexpected.

During Covid-19 it was a real test of the relationship between the supplier and retailer across all stages of the supply chain. Those with transparent supply chains thrived. There is now an appetite from customers to find a supply chain provider that is open, honest and agile with the data at hand to work as a partner, as opposed to the transactional relationship of yesteryear.

Establishing a “we're in this together” feeling between the customer and the supply chain, based on having coherent communication will instil confidence in the supply chain from your customer – reassuring them that they are part of a team that is striving to find a solution to achieve one common goal.

Thinking differently

The availability and cost of land and new facilities will be a major part of switching to growth mode. In Australia, labour shortages, supply chain disruption and limited industrial land have resulted in new industrial accommodation being in short supply. In fact, according to data from CBRE, our national industrial and logistics vacancy rate sits at a world-low of 0.8 per cent - with Sydney’s rate the lowest in the country at 0.3 per cent and Brisbane’s the highest at 1.4 per cent.

This shortage of real estate is forcing us to think differently. Not only are we looking at new sites, new distribution centres and different technologies, but we must be ready to make innovative use of existing spaces that we might not have considered previously.

Light at the end of the tunnel

I am confident that there is light at the end of the tunnel. Businesses should step out of survival mode and start to look forward to an automated, connected and sustainable future. By thinking differently and by implementing affordable, flexible and scalable technologies we can take our supply chains to the next level. "Let's just get through it and come out the other side," is no longer enough for supply chains. We’ve survived. Now it’s time to grow.

Find out more about Körber's Perspectives here.