The logistics of 2023: five challenges and a great opportunity

The World Trade Organization is convincing in its forecasts for the coming year. According to the worldwide body, there will be a sharp decline in trade as a result of the current economic situation. Due to the latter, political authorities will need to combat inflation while promoting employment, and facilitate the ecological transition. In other words, try and square the circle. With such complex circumstances, can forecasts really be made about what is to be expected in the logistics sphere for 2023?

Five major challenges

As this last year has revealed, black swans do exist. And scenarios that seemed unlikely, including a war on European soil, are occurring. So, trying to guess if ports will eventually return to normal as regards delays and if freight charges will drop is an exercise in speculation which may be pointless. However, there certainly are challenges that we know we must face. In my opinion, the following are the five most important ones.

1. Political instability internationally

Although it was believed for decades that trade interdependence was a means to prevent wars from breaking out, reality shows that, despite all, political polarization can provoke them. Outright wars, as well as territorial tensions or trade wars can destabilize major markets like the raw materials market or the supply of specific products, as occurred with semiconductors. This makes customs formalities for international trade difficult as well as the procedures necessary for shipping freight.

2. Cyber-threats

According as the sector is digitized, data turn into elements of special value that cybercriminals seek to use for their benefit. We cannot face this new type of piracy alone; we need agreements with the rest of the sector and with the political authorities. We need to protect ourselves with the best software, constant training in businesses and greater awareness by all players involved.

3. Extreme weather

We had never had so many and such heavy storms in the Pacific. We had never lost so many containers. It is the most obvious result of climate change which nobody no longer dares to deny, and which has triggered serious consequences for the entire planet, with more droughts and more flooding in different geographical areas, as reported by the UN (more data here).

4. Pressure to reduce the carbon footprint

This pressure is exerted through international regulations but, above all, it is something demanded by citizens who expect more commitment from companies: commitment to the circular economy and a reduction in greenhouse gases in transport to the point of neutrality. And these circumstances directly affect the transport of goods which still has a long way to go.

5. A review of supply chains

We are witnessing a phenomenon called deglobalization, although it is better understood as a fresh reading of world geography. The truth is that, following the latest crises, many companies are seeking to shorten their supply chains. This implies a long and complex process for them. And, for the entire logistics sector, a key moment, as it requires us to almost completely revise our way of working. This is something we have been working on in recent years, to improve the whole process and obtain optimum results for logistics in Mexico with a view to streamlining times and resources.

And the great opportunity for added value

I have left the review of supply chains for the fifth place because it is a great challenge while, at the same time, one of the greatest opportunities facing us in the logistics sector.

For decades, as globalization progressed, the transport of goods became more and more efficient and economical until it became a commodity. Nowadays, the need to rethink our role means it is time to promote the added value of logistics, as clients are going to need us to offer them products that are increasingly exact, flexible, and smart.