The entire infrastructure for transporting goods around the world shifted dramatically in 2020 due to the COVID-19 pandemic.
Supply chains were tested across industries, highlighting the need for continuity plans. It started last March and April when the virus started to severely impact operations around the world. Public health regulations prevented some goods from being shipped to certain locations, while the demand for other materials, such as personal protective equipment, soared and shortages were felt globally.
Although statistics for this past holiday season are not yet available, consumer trends most likely shifted toward online shopping due to COVID-19 restrictions, putting additional stress on the supply chain due to the spike in shipping.
With these elements in mind, the following trends from the past year will most likely shape how consumers and businesses react in 2021.
Demand shifts for different sectors
The global pandemic affected different industries in various ways. Some struggled, while others thrived.
Airlines are an example of an industry having difficulty attracting customers as restrictions prevent people from travelling. Even as vaccines become available, rebuilding customer trust and getting people to fly again in tightly confined aircraft cabins will be a struggle.
The International Air Transport Association (IATA) said in an e-commerce report that luggage sales were down 77 per cent in 2020, while men's formal wear saw a dip of 62 per cent.
Disposable glove sales, however, have increased 670 per cent. With the vaccine coming in varying shipment sizes, both glove sales along with masks will continue to be hot commodities moving forward.
Accessing these goods will continue to shift towards online, IATA reports. The report says a quarter of the world's population (2.05 billion) shopped virtually in 2020 with a jump to 2.14 billion expected in 2021.
Spreading the goods
This past year has forced many businesses to evaluate where their goods come from and consider ways to diversify their supply chains.
In an opinion piece for Supply Chain Dive, Kamala Raman, senior director analyst at Gartner Supply Chain Practice, wrote that 33 per cent of businesses have moved some sourcing and manufacturing out of China or have plans to do so in the next two to three years.
China, the first country to be hit by COVID-19, forced factories to shut down to try to stop the virus's spread and companies around the world spiraled to find alternatives for their goods.
Continuing to find alternative solutions around the world to source and transport goods should be a top priority as companies operate into the future.
Brexit
With the UK and European Union reaching a post-Brexit trade agreement at the end of December, businesses around the world will most likely see changes to how they operate with the country.
Michael Gove, a British politician, estimated in an address to the House of Commons in September that only 20 per cent of small and medium sized businesses in the UK would be ready to export to the EU in January.
British Prime Minister Boris Johnson, meanwhile, made headway with Canada in November as he and Canadian Prime Minister Justin Trudeau reached a temporary trade agreement. The two sides are planning for a permanent option in 2021.
The Canada-United Kingdom Trade Continuity Agreement ensures elimination of 98 per cent of tariffs on goods exported between the two countries.
Border Services Shift Digital
Many Canadian businesses that trade goods with other countries will see a change in 2021 with the implementation of CARM, the Canada Border Services Agency's (CBSA) Assessment and Revenue Management online tool.
CARM aims to reduce the cost of importing into Canada by transforming and modernizing the importation process. The online portal is scheduled to go live in spring of 2021.
The evolving digital state of the economy also remains top of mind for the CBSA and several other countries. Sean Borg, the CBSA's director of policy integration, planning and performance results, said in a recent LinkedIn post that a working group had been created to increase safety, security health and revenue through e-commerce.