The number of exceptional events that the supply chain has had to grapple with in recent years seems overwhelming. From the COVID-19 pandemic to the Russia-Ukraine conflict to Houthi rebels attacking vessels sailing through the Red Sea — while these events involve unfortunate situations, they’ve also enabled the supply chain to come up with smarter and more efficient logistics solutions. As a result, when shippers encountered events in 2024 such as the labor strike at U.S. and Gulf Coast ports, the supply chain was able to be more responsive and nimble to such disruptions.
While shippers might hope for a peaceful and uneventful 2025, proposed tariffs against China, Mexico, and Canada by President-elect Donald Trump are raising some concerns about freight capacity in the first half of 2025 as shippers rush to beat the effect of the tariffs on the market. Whatever actually happens, the next year is shaping up to be just as, if not more, volatile when it comes to the frequency and impact of possible exceptions.
That’s why it’s good to take stock of what lessons we’ve learned in recent years and see how we can continue to apply them in 2025.
Significant Disruptions Await Shippers in 2025
While 2025 is only weeks away, the start of the year is already shaping up to be full of uncertainty — and opportunities — given all the economic headwinds that might come our way.
High-Stakes Labor Dynamics
The International Longshoremen Association’s (ILA) strike at U.S. East and Gulf Coast ports lasted for three days and ended after the ILA and the U.S. Maritime Alliance (USMX) agreed on wage increases. The two sides said the master contract would extend until Jan. 15, 2025, so that both sides could hash out other issues, including the use of automation at the ports.
However, bargaining talks broke off in mid-November, according to the ILA and the USMX, and now supply chain stakeholders are concerned that another strike could occur in January once the contract extension ends.
Major Trade Policy Shifts
The timing of a potential strike at the ports adds a layer of complexity to concerns over whether there will be congestion at the ports as importers try to front-load cargo ahead of when Trump plans to sign an executive order right after the presidential inauguration on Jan. 20 that would levy tariffs on Mexico and Canada and an additional increase in tariffs on China.
Should these tariff changes occur, experts and observers have warned that it would give importers more incentive to front-load as much as they can before the tariffs kick in. The result of that increased front-loading activity translates into tight capacity to move the goods. Couple that tightness with a potential port strike, and freight capacity grows even tighter.
Black Swan Events
Uncertainties about a possible strike at the East and Gulf Coast ports and the impact that tariffs might have on import volumes are two considerable concerns. But the supply chain also needs to account for potential black swan events, or events that are unpredictable and have a high impact, according to Encyclopedia Britannica.
As we saw in 2023 and 2024, unforeseen black swan events, such as the attacks by Houthi rebels on ocean vessels sailing through the Red Sea and the Baltimore bridge collapse, can have significant impacts on supply chains. Those events and others like those require logistics professionals to reroute and adjust accordingly.
Proactive Strategies for Exception Handling
The unusual events of the last several years have taught us the importance of being nimble when responding to supply chain disruptions. But they’ve also taught us the importance of good data and collaborative partnerships not only to weather the storms but also to operate more responsively and proactively.
Enhancing Collaboration Across Stakeholders
Ensuring that your partners are on the same page requires not only effective information sharing but also consistent communication. Indeed, strengthening communication with suppliers, carriers, and customers can facilitate smoother operations as parties know when and how to react to any disruptions that might come their way.
However, it’s also important to establish contingency plans, including having contingency contracts with alternative providers. This is particularly helpful in black swan events when shippers have to pivot quickly and find a transportation provider that can accommodate additional cargo.
But what does effective communication entail? In addition to consistent communication to keep the channels open, effective communication might also mean employing best practices such as transparent data sharing and real-time updates. The data helps everyone speak the same language and know what to expect, while the real-time updates ensure the most up-to-date information so that partners can be informed and react quickly.
Embracing Technology Integration
As we just mentioned, real-time updates and real-time visibility help partners stay informed, allowing for a more collaborative response.
The role of real-time visibility platforms, which allow companies to track a number of different inputs simultaneously, serves a similar function and allows for better situational awareness. For instance, Gemini Shippers Association offers members access to real-time tracking data, which can then be averaged and leveraged to gain insights into shipment locations, potential delays, and estimated delivery times. This allows for better inventory management and improved customer service for clients. Couple that capability with the ability to analyze data on specific trade routes to gain insights about congestion patterns and potential alternative routes, and you’ve gotten a winning combination that enables collaborators to optimize shipping strategies and keep costs low.
Building Robust Contingency Plans
In addition to utilizing partnerships and good data, it’s also important to have contingency plans that can weather any macroeconomic headwinds, weather-related disruptions, or black swan events. Contingency planning is a form of risk management where companies are able to provide a rapid response when market curveballs come.
What contingency plans might look like may vary from company to company. One possible similarity between companies’ plans is having sufficient diversified sourcing and backup suppliers. It might translate into a more diverse geographical distribution of warehouses to minimize regional disruptions.
Whatever the contingency plans are, companies should also consider establishing practical steps for setting up response teams and conducting regular drills so that if and when the time comes, everyone is prepared and can act nimbly.
Be Proactive in the Face of Uncertainty
We’ve spoken about some potential sources of major disruption likely to face shippers in 2025. Hopefully, we’ve provided you with some actionable solutions for mitigation that you can ponder and consider implementing.
But one of the best ways to guard against operational disruptions is to collaborate and work with others in the supply chain who have the expertise and wisdom to handle the ups and downs. At Gemini Shippers, we offer you the opportunity to partner with us as you navigate freight options for your cargo. We also offer perks that you can leverage to enhance the efficiency and effectiveness of your shipping operations. As a member, you also have access to a comprehensive IT and interactive platform that provides members with various value-added features to streamline their operations.
Join Gemini today and be ready to get proactive.
