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“Flexibility comes before costs”: the mood among logisticians is changing

“Flexibility before costs”
The mood among logisticians is changing

High energy prices, severe crown lockdowns in China and the war in Ukraine are putting great pressure on the logistics sector. Commercial expectations for the next six months are clearly clouded, explains the German Logistics Association. Short-term relaxation is not in sight.

German logistics are skeptical of the war in Ukraine, the crown blocks in China and general uncertainty. “In the German logistics sector, the mood has turned negative,” explains the IFO Institute in Munich in its latest company survey for the second quarter. The German Logistics Association (BVL) reports that commercial expectations for the next six months have significantly clouded. A possible formation of separate blocs of the US, Europe and China poses risks in the global exchange of goods and services.

“A clear demarcation of political systems has serious consequences, especially in the case of critical addictions in global value chains,” says Thomas Wimmer, CEO of BVL. In the areas of purchasing, manufacturing and logistics, there are new guiding principles such as “flexibility comes before costs” and “availability is the new currency,” he explains. “What was still uneconomical yesterday is considered economically reasonable today.”

Consequently, disruptions in supply chains are not temporary problems and phenomena. “There is no relief in sight in the short term,” stressed the logistics expert. Traffic jams and delays in container transport have now also reached the North Sea and the ports of Germany, Holland and Belgium.

This not only leads to delays, but also to a lack of containers, which are currently as rare as pallets and cardboard boxes. While industry and commerce are waiting for raw materials and preliminary products or are having difficulty shipping their finished products, logistics service providers are having trouble increasing their capabilities. This in turn is also due to the massive shortage of staff. “These imbalances will continue for a few more months, until 2023,” summarized Wimmer. The Federal Ministry of Economy also predicts difficulties for the German economy due to the consequences of the crown blockade in China.

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