If The UK Government Wants To Improve Supply Chain Visibility, The Solution Already Exists

Consumers care about how products move around now more than they ever have. This is a new thing for the average consumer and is in large part because of recent shortages linked to the Coronavirus pandemic. Yes, some consumers always cared about supply chains because how a product gets from A to B affects things like carbon emissions, exploitation of vulnerable people and other social justice concerns. But the typical consumer cares because how a product moves, where it moves from and where it needs to be, has a material impact on their life.

When America experienced a shortage of infant formula, it was a supply chain problem and a population health problem at the same time. Some babies were at a non-trivial risk of malnutrition. Concerned parents reacted as you would expect them to. Consumers are as much a part of the supply chain as trucks, shipping containers and customs declarations. And they are starting to realise that their behaviour has a direct influence on supply chain dynamics. So they care and some are willing to modify their behaviour accordingly.

It's not just global pandemics that disrupt supply chains. It can happen quickly and without warning. The Suez Canal blockage of 2021 caused tens of millions dollars' worth of disruption per day. In Europe, supply chains are currently straining and failing because of protests by farmers in the Netherlands. That's in addition to existing challenges posed by Russia's invasion of Ukraine.

These are geopolitical events and the average consumer would expect a large geopolitical event to have an impact on supply chains. What the average consumer may not expect, and may be very surprised to learn, is that their household budget has been directly influenced by avoidable supply chain inefficiencies for years.

Export documents are one example. In many export scenarios, these are filled out by hand. This leads to errors and delays. The problem is particularly acute in Europe, where national borders are closer together and one of the biggest local economies has recently elected to remove itself from the unified trading block of the EU, meaning more paperwork all round.

"Customs paperwork has always been the biggest source of friction in the global supply chain, says Sam Tyagi, founder and CEO of KlearNow, a smart logistics as a service (LaaS) platform that helps importers and exporters achieve greater supply chain visibility.

"The level of bureaucracy has created a system that cannot tolerate even minor disruption.The consumer always pays the price for inefficient customs processes. Supply chain inefficiencies are costed into the price of goods on the supermarket shelf," he continues.

Governments are aware of the issue, but have been slow to react. The Biden-Harris administration's March unveiling of the Freight Logistics Optimization Works (FLOW) initiative is claimed to address "supply chain vulnerabilities and congestion, working to speed up the movement of goods, and lower costs for families", according to a White House press release.

Many of the supply chain sector's leaders have questioned why the Administration hasn't looked to include ready-made solutions within the initiative. Ben Gordon, managing partner at Cambridge Capital, a supply chain investment expert said to industry press:

"Why is the White House forming a supply chain data initiative but not including any supply chain software companies? Who is putting this initiative together? Where are the actual industry leaders in supply chain data?"

It's a frustration Tyagi shares. His firm creates exactly the kind of software that could support initiatives like this around the world. And with the UK government now opening a consultation on a similar initiative, he's concerned about missed opportunities.

"Providing reliable data flow and end-to-end visibility is crucial for supply chain resilience and it is a problem KlearNow is already solving in the UK, North America and soon, in parts of Europe. We know information sharing is key to ensuring supply chains are flexible, resilient and able to withstand shocks. Lack of visibility and data sharing has been a major historical weakness in the industry. The significant disruptions to global supply chains over the past two years demonstrate the necessity of visibility and collaboration. KlearNow welcomes the announcement from the Biden-Harris Administration and calls for similar moves from the UK government."

The solutions to a significant number of supply chain problems exist already. The low appetite for widespread adoption is causing concern within the sector. Private enterprises are developing solutions to problems before governments formally acknowledge the problems exist. Investors are more switched on.

KlearNow, for example, closed a series B funding round at the end of 2021. Tyagi noted at the time that demand for services that smooth away supply friction was rightly sky high.

"Our last round of funding enables us to aggressively accelerate our technology development and deployment, geographical expansion, and talent investments, helping us transform supply chains that power commerce."

Tyagi wasn't alone in predicting the importance of supply chain technology at the end of last year. The Wall Street Journal reported that investors were 'piling in' on the industry, "​​pumping up valuations of logistics startups as global bottlenecks raise the profile of a once-overlooked sector."