For nearly 15 years, the American Logistics Aid Network (ALAN) has been in the thick of relief and recovery efforts in disasters ranging from hurricanes to tornadoes, from tsunamis to floods. But it has never faced anything like this.
COVID-19, the name for the novel coronavirus which, according to World Health Organization (WHO) figures released Monday, has resulted in 167,511 confirmed cases and 6,600 deaths worldwide, presents America's supply chains with unprecedented challenges, according to Kathy Fulton, ALAN's executive director. A natural disaster is typically confined to a state or, at most, a region. It is visible to the naked eye. It also has a start and end date. COVID-19 shares none of these characteristics, with perhaps the most profound difference, Fulton said, being its nationwide scope. "We've never had to deal with a crisis of this size," Fulton said in an interview with FreightWaves on Monday.
ALAN's mission, which is to help ensure supply chain continuity by connecting relief organizations of all stripes with private-sector logistics resources, will be the same with COVID-19 as it's been for the other crises it has confronted, according to Fulton. ALAN will continue to work through the relief organizations as it has always done, she said. But the specifics of the response will be different because the supply disruptions are unique, she said.
Indeed, COVID-19 is reshaping supply chains before our eyes, Fulton said. For example, normal "demand locations" like restaurants and schools are no longer available due to governments' social-distancing policies and their calls for American citizens to stay home if at all possible to minimize the communicability risk; grocery stores that saw a drop-off in business the past few years as more people ate out are now seeing 200%-300% increases in demand, leading to rapid and severe stockouts at stores. This has reconfigured the food supply chain almost overnight, she said.
As for schools, closings all over the country are depriving many children of needed lunches and sources of nutrition. Supply chains will need to be reconfigured to get foodstuffs to new destinations, she said. So far, ALAN has fielded a couple of requests for refrigerated haulers for meal deliveries, according to Fulton. Besides its principal function as a logistics conduit — though it is not a third-party logistics provider — ALAN manages the aggregation and analysis of vital information to help understand supply and demand flows.
The United States is in the early stages of this battle, Fulton said, noting the monthslong timeline of China, where the virus originated. (The positive news is that about 80% of Chinese truckers are now back on the road and companies are shipping again.) In addition, the U.S. is behind the response curve in part because many smart people believed just one week ago that the virus would not pose a serious threat, she noted.
President Donald Trump late Monday acknowledged that the spread of the virus is not under control, and that the crisis might tip the economy into recession. More severe crowd-gathering restrictions are being imposed, and as an uptick in confirmed cases occurs as more Americans get tested, more businesses may decide to close or stay closed longer for the health and safety of customers and employees.
Supply chain friction is likely to worsen as more stakeholders — namely workers — test positive and are quarantined, are fearful about going to work, or are instructed by their employers to remain at home, Fulton said. For all its ramp-ups, China is not fully past the crisis wrought by the virus, she said.
COVID-19 will change the way Americans live and work and will also elevate concerns, even after it dies out, about the next virus, she said. In 2017, Fulton referred to the calamities caused by Hurricanes Harvey, Irma and Maria as unprecedented. "Those are nothing compared to what we are dealing with now," she said.
Image Sourced from Pixabay