Although the large-scale backups that roiled the supply chain throughout the pandemic have mostly subsided, their impact continues to be felt — not just in terms of shortages of key goods, but also in the way that supply chains have shifted their strategies to avoid future headaches.

Spooked by memories of paper towel shortages as well as current disruptions (such as the scarcity of CO₂ that could eventually lead to a beer shortage), businesses are stocking up on inventory, sometimes more than they need. And if those goods expire or just collect dust, businesses will face unnecessary costs and waste.

Between May and July of 2022, retailers including Target and Walmart saw steep increases in inventory year-over-year, with the former up 36% and the latter 25%. It’s a complexity that could cause even greater headaches, as retailers look to clear more space for popular holiday items and 2023 goods.

The problem can’t be solved at one level of the supply chain. Manufacturers and their logistics partners need to take steps to make the supply chain more resilient upstream. Following are four key logistics strategies that are likely to pick up steam in 2023 — tackling disruption without added inventory nightmares.

Bring It on Home

While offshoring has meant significant cost savings for supply chains, the pandemic demonstrated the pitfalls of outsourcing manufacturing. Outbreaks across Europe and Asia slowed or shuttered assembly lines, preventing the arrival of both raw materials and finished goods. Even when international supply chains were up and running, weeks-long delays at U.S. ports and a worsening truck driver shortage prevented quick relief.

In response, there’s likely to be a shift to near-shoring, or moving production back to the U.S., over the next few years. The closer manufacturing occurs to distribution hubs, the less need there is for multiple forms of transportation — and the greater number of contingencies available in the event of disruption. And with Congress encouraging domestic manufacturing through legislation such as the CHIPS and Science Act, there are both fiscal and logistical incentives to shifting production closer to home.

Aim for Supply Success

Much as retailers and distributors are dependent on manufacturers, manufacturers are dependent on suppliers — and even the best suppliers can encounter downtime. Last fall, we watched Hurricane Ian tear across Florida and North Carolina. Suppliers in the path of the storm had to close for several days, and if buildings were damaged, perhaps much longer.

Manufacturers are bound to encounter foreseeable but unavoidable roadblocks in securing raw materials. Failure to diversify supplier lists can leave a producer vulnerable in the event of an unexpected disruption.

That’s why 2023 should be a year of supplier diversification. Supply chain professionals should begin by looking at where they’re spending to obtain raw materials, and ensure that any duplication is strategic. (For example, more than supplier might be necessary to keep up with demand.) Or procurement professionals might want to choose suppliers that operate in different parts of the country, giving the manufacturer a buffer in the event that a particular region goes offline.

Go Back to School

Both manufacturers and fulfillment operations currently face a deficit of employees. But while it might be easier to fill roles focused on picking and packing, more specialized, critical roles such as forklift operators can’t be replaced as easily. New technologies such as autonomous mobile robots also require skilled employees, who have their pick of employers.

Now is a good time for supply chain experts to invest in upskilling current employees, whether to get certification in different material-handling roles, or to learn the management skills needed to rise through the company. Investing in current employees not only allows supply chains to reduce their exposure to the volatile labor market; it also helps build employee morale.

Get 20/20 Vision

Today’s supply chains are far too complex to manage manually. Yet plenty of manufacturers and fulfillment partners still rely on spreadsheets to track inventory and supplies as they move from factory to warehouse to the last mile. Not only do manual processes make it more difficult to understand sources of disruption and waste; they also make it harder for customers to understand where their order is.

To become truly resilient in the new year, companies will require deeper visibility across the supply chain. They need to understand where potential disruptions might arise, and be able to alter operations based on data gathered from current or previous disruptions. By investing in technology for supply chain planning, businesses can communicate across each node of the supply chain and plan contingences, in many cases days or weeks before disruption strikes.

In the coming years, supply chains will grow ever more complex, embracing additional nodes, SKUs and delivery methods. Now is the time for companies to act, and counter disruption before it strikes. By addressing the length of supply chains, the pool of suppliers, employee skills and the depth of visibility, manufacturers and fulfillment partners can take steps to keep products moving.

Felix Vicknair is vice president, supply chain solutions at Kenco Group.