Challenges faced by shipping companies in extreme weather conditions
As we are moving towards digital world, we can see that logistics industry is playing a very vital role, earlier logistics industry used to work in B2B segment only but as of now the logistics is handling B2C segment so that last mile delivery is provided to the client. So now the Indian shipping companies have more responsibility on their shoulders, but there are problems in every sector and the biggest problem in the logistics industry is the extreme weather conditions. Shipping service gets adversely affected due to extreme weather conditions.
Types of extreme weather conditions which affects the shipping services:-
1.Rainfall :- Rainfall is the major weather condition which affects the shipping companies, because rainfall reduces the visibility and it becomes really difficult for transporters and air cargos to reach the destination adding onto it rainfall leads to water clog situation and it gets really difficult for the transporter to reach the destination by road.
2.Storm :- Storm is another weather condition which creates havoc and directly disrupts the supply chain system . Air Cargos are directly cancelled and road transporters get really slow and eventually the shipment gets delayed.
3. Tsunami :- Tsunami are weather conditions which affect the shipments which are done through seaways, mainly the affected area is the coastal region of India and after the area is affected due to this weather condition , Indian shipping companies rely on road transportation for their business.
4.Snow/Ice:- Snow is that weather condition that affects all modes of transportations except the air cargos , because if there is snow then it is obvious that the area is hilly and railways don’t operate in such areas, moreover the road transportation gets affected due to snow , because there is no space available for the transporters on the road. So in such situations the prices of shipment increases because the shipment is highly dependent on air cargo.
5. Extreme summer/winter:- Though these weather conditions don’t affect the shipment services directly, these weather conditions indirectly affect the Indian shipping companies as these conditions tire the transporters more and it also affects the health conditions of the transporters.
How extreme weather conditions affect the Indian shipping companies?
1. Delayed Deliveries :- First thing which gets affected by these extreme weather conditions is that now the delivery of the shipment gets delayed. Delayed deliveries affects the demand and supply chain which is the biggest problem for the companies . Delayed deliveries also increases the churn rate because customers always want their shipment to be delivered as early as possible.
2. Price:- Prices of shipment increases because of these extreme weather conditions and it is always difficult to predict the prices for such conditions . As no company plans according to these weather conditions so at the end they end up paying more prices for shipment services. Eventually the company is compelled to increase the final prices of the goods they sell.
3. Capacity:- If there is such extreme weather conditions , then it is pretty obvious there will be a minimum, trucks on the roads, flights in the air, trains on the track, ships in sea. So if the medium of transport is limited then the capacity of goods shipped will also be limited and if the goods shipped are limited then it is pretty obvious that it will affect the demand and supply and the prices are bound to increase thereafter.
4. Fuel Resources:- We all know that fuel is also transported through trucks and if there is such extreme weather conditions , then the fuel carrying trucks are also limited and the prices of fuel resources rise which leads to the higher rates of the shipment.
5. Loss of employees :- These weather conditions lead to accidents , which may cause loss of lives and the company may lose employees .
6.Shipments getting lost :- There are high chances that these weather conditions can lead to accidents and in such scenarios shipment can also be lost and further shipping companies have to bear all the expenses of the lost shipment.
It is true that we don’t have any control on the weather conditions, and we very well know how these conditions can affect the shipping services. Logistics is considered as the backbone of the Indian economy as of now, so it is always better for Indian shipping companies to plan for such extreme weather conditions in advance. Backup should be created for such scenarios by both the shipping companies and Goods manufacturing companies. Buffer stock should always be there to cater the needs in such conditions, companies which ship their goods to those areas which have extreme weather conditions should always prefer to have inventory management for their warehouses. The companies should have tie-ups with more than one shipment delivery partner, because if their primary shipment service provider is not able to fulfil the shipment or your shipment is getting delayed, you can always shift to secondary delivery partners.