Transporters whether owner/operator or fleet owners or a large transport company, all have been individually impacted due to the prevalent lockdown in India. The current situation has emerges as a public health emergency that has impacted both individuals and organizations alike. However, being aware of the critical situation and taking proactive steps can help the truckers mitigate disruption in transportation services due to the current lockdown.
The lockdown in India began on 25th March, 2020, until then the truckload volumes were on par with the last quarter of 2019. It was since the month of April that the capacities became a larger issue since the trucks have been stranded due to zero movement. The impact of zero demand may further prevent the beleaguered trucking sector to move towards potential recovery during the latter half of the year when the lockdown is expected to be fully lifted in India. This situation has made the first quarter very challenging for the logistics industry.
The current trend warrants transporters to assume a slow recovery and take actions accordingly. The crisis will evidently prove how strong long-term business relationships come into picture with respect to the idle drivers, the stalled manufacturing activity and the rebound in demand for freight opportunities. The truckers must maintain their connection with the idle drivers by paying them the salaries with job assurance going forward. They must also be adept in maintaining their client relationship to win their augmented demand when conditions change for better.
Strong adaptability among truckers
Many transporters in the logistics space are adapting to the changing pattern in demand. TSRTC for instance, has converted many of its buses into essentials carrying vehicles for emergency purposes. Indian Railways too have cancelled all their passenger services and ramped up goods trains’ services carrying essential commodities. This provided an opportunity for the truckers to help such services with the first mile and last mile to keep their operations alive till such time when the markets open up fully and the demand scales to peak for goods transport services by road.
Improvised supply chain for Agriculture
There have been major disruptions in the supply chain for agriculture products due to transportation problems and related issues. Preliminary reports suggested the non-availability of the truck drivers to be a major disruption in the non-availability of trucks for agriculture produce. This has impacted in the pricing of food grains which have reduced considerably. The measures to boost the supply chain of agriculture produce are mentioned here:
- The lockdown guidelines from the 2nd phase of lockdown exempted farm operations and the supply chain thus enabling trucking to resume operations for agriculture. The truckers were unable to cope up with this initial exemption and have failed to implement the operations. This has by now rectified to a certain extent and trucking operations have begun to move the agricultural produce
- The supply of trucks must be improved to balance the demand keeping supply chain functioning well which is crucial to food and essentials security in the country
- Social distancing must be practiced between the farm workers and truckers to protect them for the corona virus
- Truckers should enable farmers to a continued access to the markets – both for government procurement and private supply chain
- Both farmers and the truck drivers must be included in the financial stimulus released by the government on 13th May, 2020
As the lockdown measures have become more stringent, the demand for door commerce for groceries and essentials has shown a spurt. This has resulted in the sudden demand for mini trucks that double up as mobile warehouses for the food distributors.
The manufacturers and traders too have taken a substantial impact in their profits due to a standstill in their activities. This has also resulted in breach of contract agreement with their suppliers and transporters. This situation has warranted renegotiation of the contract that may have cost implications due to potential rise in the cost of transportation. It will not be easier for the organizations to assess the costs against the individual stakeholder and must attribute this to the conditions in hand.
Supply chain and logistics may not be the same after the lockdown is lifted fully. There will be an increased focus on flexibility, risk exposure and contract continuity plans in future. The transporters will now ensure they are financially protected in terms of an insurance cover against contract agreements to mitigate the losses against stalled business due to unforeseen circumstances.