Strength in numbers: Joining forces with construction
In construction, logistics and the supply chain are paramount for acquiring necessary materials for production. Steel, concrete, cement — the list of materials needed to carry out construction is practically endless. Naturally, hiccups in the supply chain will affect any project.
Raw materials must be mined or sourced, treated and distributed, and as Construction News explains, an interruption during any stage of this process can have major implications for project tasks in terms of deadlines and budget.
And, according to For Construction Pros, a construction boom is on the horizon. As more people migrate in all directions across the country, more shopping centers, homes, schools, offices and other facilities will need to be built to accommodate this movement. This means that more than ever before, construction companies will need to have their supply chain ducks in a row if they want to be adequately prepared.
So, this begs the question: How can the logistics and construction industries work together to overcome supply chain challenges? Let's take a look:
As supply and demand continue to fluctuate and geo-political issues (particularly the current Russia-Ukraine conflict) consistently affect the supply chain, businesses are increasingly turning to local suppliers to source the goods they need. Right now, approximately 30% of all construction materials are being sourced abroad. Per Vertex, purchasing materials and merchandise from regional providers means that companies aren't subject to the constraints that long-distance transportation presents.
Over the last several years, we've seen that port congestion presents a particularly harmful problem within the supply chain. Companies operating in logistics can partner with those in construction to "identify the best-value, sustainable resources and facilitate their efficient transport" to overcome this specific obstacle.
Logistics specialists who work at key touchpoints throughout the supply chain — such as air and sea ports — could potentially liaise with construction company staff to inform them of any delays. They might also provide greater connectivity that can greatly reduce transportation periods between materials' points of arrival or departure and their final destination. The physical locations at which these specialists work might also feasibly be used as processing or manufacturing facilities themselves, rather than mere cargo holding areas.
As Construct Connect reports, one of the most pressing issues construction companies face is managing their inventory adequately. Many find themselves suddenly without an adequate supply of any given material due to unfilled orders or poor stock keeping. The logistics businesses that work with these businesses could conceivably implement tracking systems and technologies to cross-check order volumes and status updates so that construction organizations can ensure they have all the products they need, when they need them. Increasing every party's line of sight into their products' whereabouts and project progress will be crucial for both logistics and construction businesses' success.
Ultimately, the payoff of construction and logistics companies strengthening bonds and pursuing greater collaboration is considerable for all parties involved.