Two of the biggest topics on people’s minds right now are COVID booster shots and supply chain shortages. And unfortunately, these two are feeding into each other. With the FDA approving booster shots and vaccinations for younger people, and the supply chain facing historic back-ups, shipping vaccinations is once again a top-of-mind issue. And the effects are being felt across the government, carriers and shippers. With that, here is a brief look at how vaccine shipping is impacting the supply chain and vice versa.
Eating Up More Capacity During An Already Tight Market
One of the main factors driving the supply chain crisis is the shortage of carriers. This is especially true for refrigerated capacity, which vaccines directly impact. Vaccines are now occupying space that under normal circumstances would be used to transport food leading to increased food costs and empty shelves at grocery stores. To compound matters, as with other sectors, employment-related vaccine mandates for companies with 100+ workers could cause drivers to leave large carriers for small ones, or exit the profession altogether.
The Government Using Smaller Carriers
Normally when the government needs high-value products shipped, they leverage bigger, contracted carriers. But with sky-high rejection rates from large carriers, the government continues to wade new territory by leveraging smaller carriers to haul time-sensitive vaccine loads. In turn, this is putting pressure on smaller carriers, who may not have worked with the government previously– to learn and follow new processes.
Much like with any capacity crunch, shippers are facing heightened freight procurement costs. Recent reports state that freight spending by shippers increased 32% YoY. And this is not likely to dissipate anytime soon. Fortunately, this means that it is more important than ever for shippers to understand what factors impact load cost so they can optimize accordingly for any chance to maintain an efficient transportation budget.