For those in the middle of the supply chain in Central Kentucky, quickly adapting to the changing COVID-19 world is an ongoing effort.
From the onset, supply chains and distribution networks were critical in getting supplies to store shelves as shoppers bought out supermarkets and discount stores. Now, getting medical supplies from producers to hospitals is a critical concern.
And in the midst of massive changes in what is being shipped, logistics companies must also deal with changes in how they do business.
For Evan Calvin, managing director of LandCal, a logistics company in Georgetown, stay-at-home orders issued by Gov. Andy Beshear in March meant working from home.
“It honestly hasn’t changed too much for us — we already worked remotely. There are five people in the office and the others work outside of the state, so that transition hasn’t been too difficult for us,” Calvin said.
The biggest shift, he said, was adapting quickly to the changing structure of the markets.
Prior to the social distancing and stay-at-home orders issued to combat the coronavirus, freight volumes (the measure of how much freight is being shipped nationally) across the country were growing. Volumes in 2018 and 2019 were record low years, he said. But during the last week of March, freight volumes surged to an all-time high.
Now those volumes are headed down, with no end in sight.
According to FreightWaves, a publication that covers the shipping industry, freight volumes on long-haul trips were up over a six- month period ending in February. Volumes for short-haul trips were up 20 percent.
Calvin said those volumes shot up during March, as distribution networks reeled trying to keep up with consumer demand.
Now, however, freight volumes have fallen again and continue to plummet, according to Yahoo! Finance, as stay-at-home orders remain in place and more businesses shutter every day.
Calvin said truckers and vendors are all working together to ensure the safety of drivers and those working in shipping/receiving warehouses.
At Amazon, which has two warehouse facilities in Lexington, changes include distributing masks to employees and taking employees’ temperatures, as well as working on routine testing of employees.
“A next step might be regular testing of all employees, including those showing no symptoms. Regular testing on a global scale across all industries would both help keep people safe and help get the economy back up and running,” the company said on its blog. “Until we have an effective vaccine available in billions of doses, high-volume testing capacity would be of great help, but getting that done will take collective action by NGOs, companies, and governments. For our part, we’ve begun the work of building incremental testing capacity. A team of Amazonians with a variety of skills — from research scientists and program managers to procurement specialists and software engineers — have moved from their normal day jobs onto a dedicated team to work on this initiative. We have begun assembling the equipment we need to build our first lab and hope to start testing small numbers of our front-line employees soon.”
Keri Bertolino, a spokeswoman for Amazon, said that while she couldn’t speak specifically on operations in Lexington, where several workers have tested positive for COVID-19, the company is working to ensure the safety of all of its warehouse employees as well as its customers.
“To serve our customers while also helping to ensure the safety of our associates, we’ve changed our logistics, transportation, supply chain, purchasing and third-party seller processes to prioritize stocking and delivering items that are a higher priority for our customers.” —Amazon spokeswoman Keri Bertolino
“To serve our customers while also helping to ensure the safety of our associates, we’ve changed our logistics, transportation, supply chain, purchasing and third-party seller processes to prioritize stocking and delivering items that are a higher priority for our customers,” Bertolino said in a statement. “This has resulted in some of our delivery promises being longer than usual. We are also hiring over 100,000 positions across the United States to enable us to provide this vital service to people everywhere, especially to those, like the elderly, who are most vulnerable.”
At places like Kroger and Meijer, operations continue at a brisk pace.
Cincinnati-based Kroger operates 44 distribution centers across the country to serve all 22 of its operating divisions, using a fleet of 867 tractors, 35 trucks and 12,853 trailers. In late March, the Cincinnati Enquirer reported that the company’s Blue Ash distribution center, which collects and distributes its perishable goods, sends out 120 semi-trucks full of grocery supplies to area stores, averaging 1 million cases of groceries per week.
According to Jeff Durrough, regional director of logistics for the distribution centers, business is anything but normal.
“It’s been like Thanksgiving every day since [March 12],” Durrough told the Enquirer.
Kroger has said that it would allow its associates to wear protective masks and gloves, and is working hard to not only secure personal protective equipment, but also to enforce to government officials that grocery workers, after health care workers, should be given priority for PPEs.
Kroger CEO Rodney McMullen said he is conferring with industry peers as far away as China in order to stay on top of the situation.
For Calvin, the challenges are not over. He sees big changes coming to shippers and receivers.
“I wouldn’t be surprised if we saw a lot of trucking companies and small business suppliers go out of business if this drags on,” he said. “This has been wildly different from anything we’ve seen. Once it does stop, we’ll bounce back, but it will be interesting to see how many people survive to get there.”