What have been the challenges?
During the panic buying phase of the crisis, the major challenge for many logistics operators and their customers was the ability restock quickly enough to keep pace with demand. Rapid action by state and territory governments in removing curfews on overnight deliveries were critical in overcoming that. The state and territory border closures and general restrictions around social distancing were another challenge that required rapid action to secure the broadest possible exemptions for freight and logistics transport activities, so that freight was not needlessly delayed at border check points. And of course, the cessation of 95% of scheduled commercial passenger flights had a massive impact on air-freight, given overwhelming bulk of it is ordinarily carried in the cargo hold of passenger planes – which suddenly meant that overnight deliveries were incredibly difficult to achieve in some parts of the country.
More broadly, because the restrictions were imposed so quickly, there were a number of issues that had to quickly be unpicked. Perhaps the most prominent of those was the closure of rest stops and roadhouse facilities on key freight routes – so even though freight was deemed essential, those who were providing the service couldn’t access food and beverage services, or hygienic bathroom facilities. Extraordinary demand for home delivery of goods because people were doing far more shopping online also meant logistics service providers had to redeploy personnel from other activities to frontline delivery services. Some of the processes around those deliveries also had to rapidly be adjusted – such as moving from signature on delivery to contactless delivery, to comply with social distancing and minimise risks of COVID-19 exposure for drivers.
In a wider sense, the ongoing economic challenge arising from COVID-19 has also been a challenge for logistics providers, in the sense that it’s altered consumer behaviour. Although demand for grocery products was very high at the onset of the crisis, that has to be weighed against a significant drop off for products such as fuel, as restrictions meant travel activities were severely curtailed and demand fell away. Many of those who provide deliveries of stock to hospitality venues continue to struggle as many remain closed, even with some restrictions beginning to ease.
What lessons have been learned?
I think the biggest lesson learned by policy makers and by the broader community is that supply chain resilience matters. People who were unable to obtain toilet paper, rice, pasta of cleaning products for lengthy periods because they just weren’t on the supermarket shelves now understand that. Previously, I think that supply chain operations were just taken for granted. The COVID-19 experience will also require people think more broadly about what we mean by ‘safety’. Yes, of course, it’s physical safety when operating vehicles and other equipment, but now it’s also about COVID-safe practices – minimising physical contact, making sure that drivers visiting distribution centres aren’t exposed to COVID risks.
It has forced an examination not only of how we do things, but also why we’ve been doing things a certain way. There have been virtually no complains about the removal of curfews, for instance – so the question is why do we need them? Similarly, the move to contactless deliveries – why were so many of our processes still reliant on pen and paper, or on physical signatures? Like anything, these things tend to get embedded, and people just think “that’s the way it is” and get on with it. But I think there’ll be a greater willingness to question and improve our processes going forward.
As an industry, I think we’ve learned the value of cooperative action. Supply chains are obviously comprised of different transport modes and a large number of organisations that provide services. What was really inspiring, particularly in the first weeks of the crisis, was the way that all parts of the industry banded together, and organisations partnered to make sure that elderly people who were stuck inside and aren’t used to doing things like online shopping could get a box full of essential grocery and personal hygiene items delivered to their doorstep.
What is required for full recovery?
From an ALC perspective, it’s not a question of governments and industry reinventing the wheel, but it is about expediting plans and projects in place. Take the National Freight and Supply Chain Strategy (NFSCS), released just 10 months ago. Fundamentally, that was about new and enhanced infrastructure, regulatory reform and cutting red tape and enhancing Australia’s international competitiveness, and especially boosting exports in order to create employment opportunities. Each of those objectives were have also been at the heart of what governments around the country have said will be the key to a post-COVID economic recovery. I don’t think governments need to spend vast amounts of time pondering how to help our industry – the solution was there pre-COVID. But what they have to do is actually commit to delivering on those plans. There’s been some encouraging signs in that respect in the past two weeks, with all Ministers attending the recent COAG Transport and Infrastructure Council recommitting themselves to the implementation of the NFSCS. Similarly, the Prime Minister’s announcement that the construction of Inland Rail would be expedited as part of the JobMaker initiative this week was very welcome news, because it also provides confidence for those looking to make complementary infrastructure investments along the alignment, including intermodals and logistics precincts. Similarly, state and territory governments now engaging with industry on issues like curfews and agreeing to explore how modern technology can be deployed to make freight and logistics activities less intrusive, which would give operators the greater operational flexibility they have been seeking for many years.
