If there’s one thing that everyone can agree on right now (and there isn’t much) it’s that 2020 has not gone as planned or even expected. There’s no doubt that few people made any predictions at the end of 2019 that actually came to fruition this year, but that doesn’t mean that we can’t try again for 2021. In fact, many people are eagerly looking forward to 2021, in hopes that the turmoil and uncertainty of this year will finally come to an end.
With that in mind, there are some trends shaping up in the realm of supply chain and logistics for the coming year, based in large part on the challenges of the last nine months and the continued expansion of technology and new tools.
Trend #1: AI and Machine Learning Continue to Take Precedence
Artificial intelligence is already making its mark on logistics, and that trend will only continue into 2021, especially as the pandemic has changed the way we live and work. AI and machine learning are instrumental in finding new ways to automate tasks, effectively removing the human element. Many of the most recent developments are in response to the “new normal” of keeping physical distance from each other, but even in the future, when proximity isn’t such an issue, AI and machine learning tools, including data from RFID tracking tags and the Internet of Things, will continue to drive improvements in inventory management, staffing, supplier selection, shipping, and other aspects of supply chain management.
Trend #2: Ecommerce Will Continue to Evolve
Ecommerce and shopping (and doing just about everything else) online was nothing new at the start of 2020. However, the last year has changed the face of ecommerce, with most households purchasing items online that they never had before. Groceries, household basics (like toilet paper), pet products, and more all saw explosive growth in the online marketplace this year, and that’s only going to continue to expand. In terms of supply chain, the ongoing shift to buying online has changed everything from warehousing and shipping to the design of brick and mortar stores, and it will continue to shift and develop through 2021.
Trend #3: Greater Agility 
Another lesson from 2020 has been the need for agility – and that is only going to continue into 2021. Supply chains need to be prepared to shift and make adjustments quickly and efficiently. Using tools like predictive analytics allows your supply chain managers to better predict disruptions and respond to challenges like delays, scarcity, and disruption. Traditional supply chain methods are no longer adequate in the face of today’s challenges. This means taking a new approach to vendor and supplier relationships, and building stronger alliances though better transparency. Communicating with your suppliers, and staying in the loop on key performance indicators like sales, shipping data, and errors, allows you to stay on top of your production needs and make better, more strategic decisions that keep your business moving even in the face of significant challenges.
Trend #4: Increased Focus on Sustainability
The idea of sustainability is nothing new, and it’s trickled down to supply chain and logistics planning. Brands that promote sustainability at all levels are more likely to grow and attract loyal customers, and that means incorporating green principles into your logistics, too. Making changes to packaging, for instance, to reduce waste, or using eco-friendly transportation methods, can reduce your company’s carbon footprint, and in the long-term, costs as well. Developing creative methods to increase sustainability is likely to be a priority for many companies in 2021, especially in the face of increased ecommerce and changing consumer expectations.
Trend #5: Greater Flexibility in Budgeting
It’s safe to say that few companies made accurate budgeting predictions for this year back in 2019. Whether your business saw an unexpected downturn, or was one of the lucky ones to come out ahead during the pandemic, the lesson for future budget planning is clear: Flexibility is a must. Because making accurate predictions at this point is a challenge, it’s better to treat budgeting as a range, and be prepared to make decisions based on which way the pendulum swings. Supply chain leaders should be involved in the discussions regarding budgeting and allocations, as they have deep insight into the total picture and can help identify the best places to make expenditures for the greatest possible outcomes.
There’s no doubt these are challenging times for all businesses. If this year has taught us anything, it’s to expect the unexpected, and be willing to pivot when necessary. The businesses that are able to do so successfully into 2021 will be the ones that move forward and come out of this tumultuous time stronger.
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