shipping delay supply chain issues

How Global Supply Chain Issues Impact Mobility

One of the hardest-hit aspects of businesses by the pandemic is the global supply chain. The pandemic had disrupted the supply chain causing costly delays in the transfer of goods and services from raw materials down to finished goods. Most businesses felt the effects of this global event. In fact, 94% of Fortune 1000 companies are experiencing supply chain issues and 55% of companies plan to reduce their growth outlook, according to insights made by Accenture.

Accenture further enumerates the supply chain challenges many businesses are encountering:

  • Increased cost on supply chain operations
  • Lack of supply chain resilience in the face of a global health crisis
  • Expensive IT technology to shift to a digital world
  • Wide talent gaps within supply chain and operations
  • Lack of flexibility can cause the inability to satisfy evolving customer demands

But what of global mobility? How has this global supply chain hurdle affected the mobility realm?

All aspects of businesses feel the ripple effects of the Covid-19 pandemic including global mobility. Hilldrup, a logistics services company, expounds that transport and shipping delays and housing shortages are just some of the effects of global supply chain issues on global mobility. 

Transport and shipping delays

There’s no doubt that at the height of the pandemic, businesses heavily reliant on transportation and logistics services have experienced much pressure on achieving customer satisfaction. Ports around the globe met overcrowding as delays in the shipment processes caused by labor shortages and tighter restrictions existed. 

According to Dr. Johannes Schlingmeier, co-founder and CEO of Container xChange, a 60% growth of inbound outbound ratio at US West Coast ports signals congestion in the later months. In addition, a  huge percentage of supply chains are stuck in China’s ports as consumer demand and China’s manufacturing sector surprisingly thrives amid an ongoing pandemic according to Foreign Policy

In terms of global mobility professionals, they face moving and shipping challenges as logistic services companies are already bombarded with shipment congestion. Much logistics is required to relocate an assignee. It includes home purchasing, HHG shipments, storage, temporary housing, and more. The pandemic, as well as the logistical difficulties, further complicate the relocation process. And therefore, affects employee experience negatively.

Fortunately, Graebel, an international relocation company, shares its tips on how to tackle this issue head-on.

It recommends partnering with a relocation company utilizing an open supply chain model. Relocation companies with an open supply chain model don’t possess any part of the supply chain and aren’t limited to doing business with certain companies only. Instead, they work with a trusted network of suppliers allowing them to have different supplier partners who fit mobile employee needs.

Tips for global mobility teams and mobile workers

The relocation company further encourages companies not to become complacent even when partnering with relocators with an open supply chain model. Although it boasts of possessing this type of model, it admits that it isn’t immune to the challenges mentioned earlier. So, it suggests that mobility professionals and mobile employees to:

  • Maintain an open and communicative environment for both parties and expect proactivity and unexpected changes
  • Acknowledge that each move is unique and delays should be anticipated with the uncertain circumstances
  • Identify the varying needs of each mobile employee to fine-tune relocation policies
  • Work collaboratively in facing expected issues so decision-makers can provide best-fit solutions to counter them

Housing shortages

Earlier in May 2021, housing prices reached $287,148, a 13.2% increase from May 2020’s prices according to Zillow. Additionally, CNBC reports that cities like Austin, Texas, Phoenix, and Salt Lake City experienced the highest price hikes. Properties in South Florida are also 30% above the list price.

Hilldrup identified factors of this inflation:

  • The surge of first-time homebuyers
  • Families relocating away from bigger cities
  • Limited new construction
  • Low mortgage rate
  • Low availability of homes

These price hikes perfectly explain why global mobility professionals may have to review their policies to maintain a quality employee experience. Employers and mobility professionals need to communicate to mobile employees and set their expectations of the possible scenarios they will face.

Companies should expect these problems not to go away anytime soon. Employers must become more forward-thinking as global supply chain challenges persist. In order to smoothen the relocation process and maintain good employee experience, companies ought to account for planned relocation way ahead of time.