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Managing the Supply Chain in Times of Disruptive Global Events



Clarity between logistic service providers and their customers has never been more important as Covid-19, natural disasters, and shipping chaos land heavy blows, says Bidvest International Logistics

JOHANNESBURG, 20 September 2021 –  Ensuring continuity of supply in light of recent global and national events has been an unprecedented challenge for logistic service providers.

The upheavals caused by the coronavirus pandemic have forced entire countries to reimagine how they deliver resources and services while simultaneously overhauling business practices for economic sustainability.

Efforts to supply goods are being massively impacted because of  Covid-19 quarantine restrictions at ports of entry, for example.

Coronavirus outbreaks among airport ground and cargo-loading crews have necessitated that affected members are placed in quarantine for up to two weeks at a time, leaving fewer staff to handle cargo.  

Cargo is also backed up as flights are unable to depart with full loads. In one recent example, cargo had to be routed from China to Hong Kong for departure, putting tremendous strain on Hong Kong Airport and causing further delays. 

As a consequence, the uncertainty around schedule availability, workforce on the ground, and increased demand can lead to an increase in rates in the market.  

The world is also having to contend with the growing threat of climate change, increasingly manifesting as catastrophic disasters like hurricanes such as the ones in New Orleans and Texas, wildfires and flooding events that have destroyed billions of dollars worth of infrastructure.

Typhoons and extreme weather in China have become the latest challenge to global supply chains, as goods stuck at some of the world’s busiest container ports are further delayed.

In August, Shanghai’s Yangshan mega-terminal facility and nearby ports evacuated ships as Typhoon In-Fa slammed into the coast, bringing widespread flooding and toppling containers stowed in the hold of a bulk carrier traveling to the US.

Some 16-18 typhoons are expected to form in the northwest Pacific and the South China Sea until the end of 2021, with between four and six of these expected to make landfall in China or impact the country.

While most vessels are destined for the US and Europe, these goods will ultimately be exported to other parts of the world as well. The delays can wreak untold havoc on global supply chains.

Furthermore, the tensions brought on by Covid-19, destructive natural phenomena and political instability are spilling over into violent acts of civil unrest.

In South Africa, an estimated R50-billion worth of damage was caused by looters marauding through the provinces of KwaZulu-Natal and Gauteng, obliterating what little gains had been made in the country’s economic recovery effort. 

There have also been shutdowns to vital shipping lanes and ports, notably the blocking of the Suez Canal by the container ship Ever Given in March and the closure of the Chinese ports of Yantian in May and Ningbo-Zhoushan, the world’s third busiest, in August due to coronavirus outbreaks.

A cyberattack on South African parastatal Transnet in July paralysed several of the country’s ports for several weeks as well, forcing the state-owned company to declare force majeure. 

Taken together, these events have stretched logistic service providers (LSPs) to the limit.  

The congestion, shortage of empty containers, delays, rollovers of shipments and ships bypassing ports are an unintended consequence of these disruptive events which have created a supply-demand imbalance with demand outstripping supply.

In some instances, an ocean line service operator deciding to cancel a call or skip a particular port, a process known as blank sailing, can have dire consequences. On any given week, there are a number of carriers which blank sailings, reducing tonnage and increasing demand.

To put it into context, 4 000 container slots can get lost in one sailing.

But this is only one part of the problem. Trucks still need to transport the cargo arriving at ports, and when drivers who contract Covid-19 can no longer access harbour terminals, the supply chain is further disrupted.

It is no secret that the US is one of the world’s biggest consumer markets, so a boom in shipping volumes is inexorably tied into America’s consumer spend. However, the country is notorious for truck driver strikes and rail and ramp delays, to the point that turnaround of containers often exceeds 60 days.

The costs involved are also astronomical. 

Ship charter rates have multiplied in some cases by anything upwards of 300%. Short-term charter rates of between two and three months for a 5 000 TEU (twenty-foot equivalent unit) ship have topped US$135 000 (R1.9-million) a day. Longer term charters (3 to 5 years) are reaching US$50 000 (R727 000) a day.

Currently, carriers are posting record financial results, which places huge pressure on forwarders in the supply chain to manage their clients’ expectations.

In the view of Bidvest International Logistics (BIL), where lead times were previously seven days door-to-door, 21 days are now recommended to accommodate unexpected delays.

However, LSPs should expect at least some blowback. 

Because customers are facing their own pressures, perceptions of LSP service failures will mount when supply agreements don’t go according to plan.

The key, BIL says, is knowing how to approach such situations.

Among the options available to LSPs is drawing attention to Standard Trading Conditions, or declaring force majeure if such a clause is included in the service contract.

It could be pointed out, for example, that the European summer holidays are coming to an end, or that China is celebrating its annual Autumn Festival followed by Golden Week at the beginning of October, during which time most companies and factories shut down and many carriers announce blank sailings.

The dearth of manufacturing during this period automatically means that sale days like Black Friday in South Africa will be affected. 

With most carriers already fully booked due to limited space and Chinese ports experiencing backlogs due to the effects of typhoons and Covid-19 outbreaks, it stands to reason that Standard Trading Conditions will be severely hampered.

Yet, as much as these factors may be true, customers will still only see a failing supply chain, delayed deliveries to clients, penalties, lack of stock and lost sales.

BIL says no matter how justified or valid the LSP’s reasons, the despairing customer wants solutions, not excuses.

There is a solution, however.  

According to BIL, these tensions can be mitigated and even avoided, but for that to happen, there needs to be clarity between the LSP and customer from the outset.

It starts with the take-on of the Scope of Work (SOW)/service contract, including a thorough interrogation of the customer’s business model, and specifically the supply chain.

According to BIL, there are three important questions which the customer and the LSP must jointly and honestly interrogate, namely:

  • Is the customer’s business model dependent on Imports and/or exports for the survival of the business? If the answer is “yes”, meaning there is no alternative local supply, then the answers to question 2 and 3 become vital.
  • Does the customer have a robust international supply chain that will sustain its business through 2021 and beyond? If the answer is “yes”, test it by considering multiple disruptive “What if” scenarios. If the answer is still “yes” then proceed in overcoming the challenges, or draining the swamp, so to speak. If the answer is ever “no”, remember the end objective is to drain the swamp. It may therefore be time for a thorough review of the customer’s supply chain. Consider all alternative options to keep the supply chain moving through disruptive global events.
  • In the event of an unanticipated disaster or disruptive incident, are all parties unambiguously clear on the point where risk transfers from the seller to the buyer? In the event of a maritime disaster or disruptive incident, the importance of this question lies in the correct use and understanding of the Incoterms® rules, specifically the point where the seller has fulfilled its final obligation under the sales contract and risk has transferred from seller to buyer. It also pertains to understanding the obligations of the merchant as defined in the transport document to the ocean carrier/consignor (as contracting party) and air carrier.

BIL says there is no question the past 18 months have been daunting and apart from 2008/9, businesses dependent on international supply chains have rarely seen such unpredictable consequences arising from disruptive global events.

But the key to success in these times is and will continue to be resilience, and knowing how to achieve it.


The Top Five Logistics Companies in Africa.



There are a few aspects to observe when looking to find what makes the best logistics provider from their rates, reach, their ability to adapt to change and, most importantly experience and organisation of their human resources.

1.            DHL Logistics:

DHL is comfortably the world’s leading logistics company, founded in 1969, this logistics giant has a footprint in over 200 countries and a strong employee base of 590,000 people worldwide with a revenue topping €81.7B as of 2021.  It is also leading the way in innovation of new bespoke solutions to assist communities such as parcel drone delivery of medicines in East Africa.

View their website:

2.            UPS Supply Chain solutions:

Founded in 1907, UPS is one of the most recognisable logistic brands in the world. Operating in over 220 countries this USA based company manages just over 534,000 employees, turning over just under $97.3B in 2021. In 2020 they lead innovation in delivery of the Covid-19 Vaccine with research into safe drone delivery of medicines in hard to reach places.

View their website:

3.            Kuehne + Nagel:

Operating in over 100 countries with close to 78,000 employees, and a turnover of over $34.5B in 2021, Switzerland based logistics company Kuehne + Nagel has managed to become a powerhouse in the logistics industry.  Developing the largest sea freight forwarder in the world specifically in the fields of Full Container Load (FCL) and Less than Container Load (LCL).

View their website:

4.            DB Schenker Logistics:

Operating largely across Europe and North Africa, with more than 140 years’ experience in the Logistics & Supply Chain this German based company employees over 75,800 people and delivers to over 2,000 territories – with a turnover of €21.4B in 2021. They focus on providing the best and most efficient customer service that aims to make the supply chain more user-friendly. They are also the first company to utilise autonomous electric trucks, the T-Pod, on public roads for deliveries.

View their website:

5.            DSV:

A reasonably new player in the logistic industry DSV has fast climbed the ranks to become one of the top providers and most recognisable brands in the supply chain industry. Operating in 75 countries with over 75,000 employees worldwide. They are operating non-stop dispatching over 15,000 trucks per day and moving 650,000 tons of air freight every year – bringing in $28B in 2021.

View their website:

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KZN FLOODS: Durban port operations, logistics grind to a halt



Trucks travelling on the N3 between Durban and Pietermaritzburg came to a grinding halt outside Mariannhill Toll Plaza on Tuesday after deadly floods, that have killed at least 20, people hit KwaZulu-Natal overnight, with Durban and surrounding areas among the hardest-hit regions.

Many residents are still missing and the SANDF had been activated to assist the province with rescue operations, KZN Cooperative Governance and Traditional Affairs MEC Sipho Hlomuka said on Tuesday morning.

Operations at Durban port had also stopped, according to industry sources, however, a notice issued by Transnet to stakeholders on Monday night noted that port operations were on standby for heavy rains and winds on Tuesday. “Landside and waterside operations are on standby for wind and heavy rain from 19:15 on 11/04/2022. New/unutilised appointment slots will not be available until landside resumes operations. Do not dispatch trucks to the terminal without appointments as they will not be processed,” Transnet said.

Wind speed had been recorded at gusts of 70 kmph, it added.

KZN roads, including sections of the M4 between Durban and Umhloti and the N2 south of Durban, were closed as water gushed down the freeway near the old Durban International Airport. Social media posts showed overturned trucks and containers that had dislodged from vehicles strewn across the N2 freeway, south of the city.

Road Freight Association CEO Gavin Kelly said logistics operations in the province had largely come to a standstill and the Durban port was not operating.

KZN COGTA MEC Sipho Hlomuka said the weather was continuing to cause havoc across the province on Tuesday morning.

 “Residents residing in low-lying areas are urged to seek shelter on higher ground, disaster management teams have opened public facilities such as community halls for those that need shelter.  The Department of Cooperative Governance and Traditional Affairs is working together with social partners and sister departments to ensure that there is interim relief for those that are housed in shelters. So far, the extent of the heavy rains is across the province, with eThekwini being one of the most affected areas,” he said.

The department’s teams were still collating the extent of the damage.

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People are a saving grace for a Covid-weary logistics/supply-chain industry under enormous pressure



JOHANNESBURG, 14 March 2022 –  As much as automated systems are revolutionising supply chains, human capital – and more importantly, the quality thereof – remains paramount.

In Part 1 of the State Capture Commission’s report released this year, Justice Raymond Zondo went to great lengths to explain how government procurement processes had been subverted well before state capture even became part of the national conversation. Goods and services were procured when they were not needed, and there was often unnecessary duplication of work.

These practices were the direct result of people who were either unscrupulous or grossly incompetent.

This is an extreme example, but it does show what can happen when the wrong people are left to oversee logistics and supply chains.

While for the moment the worst of the Covid-19 pandemic appears to be over, Russia’s invasion of Ukraine is giving rise to further turmoil in the world economy as fuel prices skyrocket and sanctions reshape global supply chains.

That said, there is no doubt that the impact of the virus is also still being felt. Shipping costs remain high, and the world has not yet recovered from the microchip shortage affecting a number of industries.

The situation will necessitate that skilled logistics leaders and staff are in place to weather the storm and ensure that businesses won’t only remain sustainable, but profitable as well.

The supply chain industry is facing continuous change and major shifts due to the complex demands of customers. This has an impact and certain quality expectations on the roles of the supply chain specialists to adapt and shape business solutions.

Polly Mitchell-Guthrie, of supply chain software company Kinesis, points out that because today’s supply chains face many disruptions, it makes it extremely difficult to establish patterns, and no matter how technologically-advanced algorithms may be.

“It’s humans who possess the ability to derive meaning from context, so when disruptions arise, it is people who are able to use business acumen and domain expertise to make the best decisions for their supply chain,” she comments in Engineering & Technology magazine.

Certainly in South Africa there is huge scope for young, driven entrepreneurs to contribute effectively to supply chains.

A World Bank analysis for South Africa released in 2021 argued that if the country were to match the self-employment rates of countries like Brazil, Mexico and Turkey, making up an estimated 30% of all jobs, it could potentially halve its dismal unemployment rate of 34.9%.

Furthermore, the global human capital market size is expected to reach $32.68-billion (R502-billion) by 2027.

According to Fortune Business Insights, the increasing proclivity of companies towards artificial intelligence and machine-learning to eliminate unnecessary IT costs will foster the growth of market sales.

In other words, there is fertile ground for the country’s entrepreneurs to grow, and people will be at the heart of any potential revival. 

“People are the champions in making a business a success,” says Bidvest International Logistics’ (BIL) human resources director Harry Dimo.

“People are the fundamental human resources to provide quality service to the customers, therefore it is a must to continuously improve employees’ efficiency and performance.”

Dimo cannot stress enough the importance of having the “correct people with the appropriate skills sets and experience” on board to ensure processes happen as they should.

“The common qualities include the ability to solve technical problems, always display a sense of energy, learning and innovative capability, good leadership traits and intellectual humility.

“Individuals also need to be savvy in terms of the supply chain industry and be able to adapt to the continuous changes and challenges.”

At BIL, recruitment practices are geared to ensuring the company attracts and retains the best possible talent in the market.

Scouting for this talent occurs in a variety of ways. These include a state-of-the-art recruitment platform that connects to LinkedIn and all the biggest electronic job boards. There are also a large number of candidates on BIL’s database that enables it to find suitable replacements in shortened periods. The company also enjoys close relationships with recruitment agencies and boasts a well-established Employee Referral Programme which rewards employees for referring people they know to BIL.

Dimo recommends that recruiting individuals or companies should review their hiring processes by interrogating their pros and cons and align their hiring approach to business competency requirements.

By no means is BIL the only business that has had to endure the challenges of Covid-19, but it does stand out as one that has done so successfully.  This is because its leaders continued to support and develop its staff despite the pressures on global supply chains. 

“The BIL Academy had to become more innovative in how training and development should be remotely presented to employees, which brought about a big shift to insource training solutions which traditionally were outsourced to training providers,” Dimo explains.

“Management is constantly faced with the difficult task of keeping employees motivated during tough economic challenges, including Covid-19 circumstances, both inside and outside of the workplace. As a result, the best practice leadership approach is critical to ensuring that we cultivate a motivated, happy and productive workforce.”

BIL possesses what it likes to call its own internal “talent supply chain” that ensures continuity of highly-skilled staff. 

The company has a Transport Education Training Authority (TETA)- accredited internal academy that makes sure all qualifications are professionally recognised.

In addition to leadership programmes and other behavioural skills training to address the required competencies, bursaries are also offered to high potential employees who are able to pursue degrees and post-degree qualifications. 

BIL believes that while learnerships provide industry basics, tertiary study and other training address the current and future skills essential to the dynamic supply chain industry.

BIL also offers wellness solutions and employee support solutions. This offering was especially well received during the Covid-19 lockdowns.

Furthermore, the company programme includes periodical internal employee satisfaction surveys to understand what employees are going through in the workplace.

“We also have a robust and continuous improvement performance management approach which is linked to our reward system. Lastly, we have effective methods to celebrate successes and drive innovation,” Dimo concludes.

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