How Toilet Paper Almost Derailed the Supply Chains

All industries suffer to varying extents during this Corona pandemic. The spotlight is particularly on those called system relevant, meaning that they secure our basic necessities and that our lifes can continue as smoothly as possible under these circumstances.

The logistics sector remains largely unnoticed in normal times. We go to the supermarket, expecting it fully stocked at all times. We may have seen empty aisles in news reports about post-Soviet Russia or Venezuela, but we certainly never experienced them ourselves. We hardly give it another thought how Italian pasta, Spanish chorizo and Chinese Mie noodles make their way to our local shops.

The mechanics and processes behind the supply chains are so finely tuned and routined that fluctuation in demand normally does not affect the supply. Even unforeseen, unscheduled extra deliveries are taken in stride. 

Decreased supply from countries further away, such as China, and reduced air cargo traffic are not the core problem for European logisticians. Three quarters of the supply chains on the continent are truck-driven (Smart Freight Centre)^[1].The challenges that they faced and still are dealing with are closer to home: People stockpiling goods, and borders closing.

The average German needs 134 toilet paper rolls a year, that makes roughly 11 per month. An average pack contains 10 or 12 rolls, so that would make one pack per month. If you want to be on the safe side, maybe you’ll buy two. Logisticians and retailers are prepared for that.

What they weren’t prepared for, and what was impossible to foresee, were people hoarding toilet rolls as if they were precious gems. Shelves were bought empty, people were leaving stores with three, five or twelve packs each; it is doubtful that they were doing their trimonthly shop on the same day and wouldn’t be seen again until June.

The second point, countries closing their borders, posed a challenge not so much because of trucks being stuck at border controls, but rather fleet owners struggling to organise their staff. Truck drivers who live abroad - Poland mostly - were worried they would not be allowed back to their families if they came to drive a truck on German roads.^[2]

Fortunately for the supply chains, logisticians are experts at what they do, or they wouldn’t be in business for long. Shelves are stocked and trucks are on the road again. This shows how robust the logistics sector is, and how well it can cope even under strain.

There are several factors that have helped, and will continue to help making the industry more stress-resilient, flexible and efficient:

• Self-Improvement. The upside of the crisis: Shippers and forwarders realise how innovative, fast to decide, and digital they can be. The pressure that Covid-19 has put on them has made things possible that previously have been deemed as “too soon”, “too complicated” or “too risky”. This effect will hopefully last beyond the crisis, because logistics are ready for more drive and innovation!
• Load Pooling. It is improving rapidly. Logisticians are finding new and more efficient ways to pool their cargo, meaning there are fewer empty runs. The increased efficiency will hopefully last beyond the crisis, and bring forth new technologies.
• Speediness. The Corona crisis is yet fairly recent, and the logistics sector has already proven how quick to act and adaptable it can be. For example, Schenker has moved from road to rail within days to secure the supply of Italian pasta in Germany - simply by loading the cargo that was intended for trucks onto trains instead. This spontaneous and decisive spirit will further drive innovations, even after the crisis has passed.
• Digitalisation. The crisis forces the industry to tackle inefficiencies and low digitalisation. The current challenges are highlighting the pain points of many industries; logistics are no different. More efficient and digitalised processes are necessary, not only to make the sector crisis-proof, but also to make it more sustainable and ready for the future.

The current situation is challenging for everyone. An appeal to the logisticians: See the opportunity in the crisis, and use it to find better, more efficient, solutions. They will improve your business long after the pandemic is over.

From that perspective, we should send our thanks to all toilet-paper hoarders for enabling innovation - if we were to send them flowers, they would arrive punctually even in these times. 

^[1] https://www.smartfreightcentre.org/en/news/supply-chains-in-the-time-of-corona/13050/

^[2] https://www.smartfreightcentre.org/en/news/supply-chains-in-the-time-of-corona/13050/