International transport is part of the backbone not only of logistics, but of the world economy. Its ability to move goods on a planetary scale helps define what our world is like and how it will transform in the future. But, as a result of this importance and of its own nature, it faces specific and unique challenges and characteristics. What are these challenges for companies and international transport?
Challenges of companies and international transport
Longer supply chains
The greater the distance, the more difficulty and the more likely problems will arise. Longer supply chains mean more intermediaries and more cogs; that is, more lights so that something can go wrong. And, even if nothing goes wrong, aspects such as traceability become more complicated the more suppliers or participants are involved in the process.
Ethical and Corporate Social Responsibility requirements
Companies are taking more and more care of their Corporate Social Responsibility work and their ethical values. And, for this to be the case, it is necessary to maintain supervision over the collaborators that are part of our supply chain. While this can be relatively easy when we are close, as they move away from us – and especially within some countries – the risk of finding suppliers that do not meet the ethical and labor standards that our company desires increases.
The obligation to internationalize
Sometimes, internationalization is an imposed challenge. Either due to the need to continue growing or because the internal market of the sector for which we work is stopped, companies are forced to embark on the adventure of internationalization. A leap that is not easy and in which the difficulties of taking our logistics abroad must be taken into account. This difficulty becomes greater if the destinations of our expansion are outside the European Union, which will increase the legal complexity of importing or exporting to each territory.
Legal and bureaucratic complexity
As we have commented in the previous point, leaving our borders can trigger the difficulty of our operations. Especially if we work with countries with more restrictive regulations or without the agreements that we enjoy with our European neighbors, such as Russia, China, etc. In these cases, the training of our personnel assigned to logistics will also have to be greater, in addition to being familiar with the processes and terminology of international transport.
Legislation can be influential to the point of determining how we design our supply chain
Make decisions according to the legislation of each country
Legislation is not only going to influence the execution of our logistics, but may even influence the very design of the supply chain. Tariffs and other taxes and regulations vary between countries, which can lead to changes in where we source or ship a product from. Likewise, we can choose to work in countries that involve less bureaucratic turmoil to increase our efficiency.
Longer provisioning time
When your source of supply is close to you, you will usually be less sensitive to supply problems that may arise, since you can solve them in less time. However, the larger your supply chain grows, the longer it will take to travel from one point to another. And, as much as international transport optimizes its transits, the times to solve a stock out can be measured in months in some cases.
This fact forces companies to better measure their needs and sales forecasts and to design their logistics processes more accurately, knowing exactly how much time their different movements of goods take.
The more operations, the more opportunities to optimize we have. On shorter – and possibly more standardized – paths, there may be fewer options for this optimization. However, on international routes the possibilities increase: finding more convenient routes, multimodal options, reducing the time merchandise is stopped, improving the selection of suppliers…
Traceability is key in logistics and international transport is no exception. Even more so if the journeys are very long and, therefore, poor traceability can lead to an incident of several days or weeks. The problem stems from the fact that distance also amplifies the difficulty of achieving good traceability. It is necessary to ensure that all the actors in the chain are technologically capable of maintaining this traceability and, in addition, that at the moment of truth they comply with the agreed logistics deadlines.
In international transport, the strong presence of the sea and containers stands out, more marked as we move further away. Given this multimodal nature, companies and logistics operators dedicated to international transport must know how to assess the best way to take advantage of the different means of transport at their disposal. It is necessary to continually review our routes and have several options available to us in case of need -that one of them stops being available due to economic, political, meteorological problems, etc.
One of the main unknowns that those involved in international transport have to resolve is whether they will be able to maintain the quality standards they have in their national service and in their internal logistics, whether for import or export. The possible improvements in costs for sourcing abroad will not be worth it if, in return, we suffer stoppages in our supply chain. In the same way, making the leap to another country at the cost of doing it with a worse service will make it very possible for the adventure to fail and, furthermore, it will harm the image of our brand in the areas in which we are already consolidated.
Deal with the unpredictable
If we had to stay with a single challenge for international transport, it would be the need to deal with the unpredictable, since in a certain way it includes the rest. When we leave our borders, we accept that our logistical work is complicated, since we multiply the factors that influence us and over many of which we will not be able to have total control.
A failure 10,000 kilometers from home is always going to be more difficult to solve than one that happens around the corner. And, without the need for there to be failures, the casuistry of international transport is much greater than that of domestic transport. A strike in a country, oil prices, a natural catastrophe, problems of any kind (financial, service, etc.) of a supplier of ours -perhaps we were even unaware of its existence-, etc. can affect us.
Our ability to measure, control and supervise the entire process will be key to making the international transport of our company a success. Knowing that we really maintain control over the process will be a good sign that we are on the right track.