This Mega Snowstorm Will Be a Test for the US Supply Chain

It comes. Two-thirds of the US is facing the threat of severe snow, cold and ice this weekend, with the potential to jam roads (and the businesses that depend on them) from Texas to New York City. At this point, grocery stores, logistics specialists, warehouse operators and trucking companies have been preparing for days. Nevertheless, the impact on the supply chain and the retail store shelves that depend on them has not yet been determined.

On the one hand, it’s winter business as usual. Blizzards happen every year, and the freight industry has a playbook.

“If you’re a retailer, it happens all the time,” says Chris Caplice, chief scientist at transportation management firm DAT Freight & Analytics. “For those in the supply chain, it’s just another Tuesday.”

On the other hand, the locations where this storm is coming, and its intensity create an additional challenge.

“It’s a little tough, because the states where this storm is coming don’t get a lot of snow storms,” ​​says Chris Long, executive vice president of operations for Capstone Logistics, a third-party logistics firm. Affected southern states, including Texas, Oklahoma and Arkansas, are often ill-equipped to deal with hurricanes, with networks of distribution centers set up to distribute what is often needed after a storm like that: generators, water, plywood. But if roads in states that are less equipped for the cold remain frozen for several days — “a worst-case scenario,” Long says — shoppers could see shortages of some perishable items, including food and pharmaceuticals.

To prevent this, retailers have spent the past few days placing specific inventory in local distribution warehouses where they know customers will want it – like snow shovels, bottled water, canned goods, de-icers, where it can quickly get to store shelves. Large trucking companies have deployed their vehicles and employees where they will be needed; Independent truck drivers have probably vacated the road.

Caplice says next week, as everyone digs up or thaws items left over from the storm, freight prices are likely to rise as freight companies try to get supply chains running again. But such a shock is likely to impact retailers’ business — after all, it is winter — and have no impact on the prices customers see at check-out. He says uncertainty over tariffs and immigration is a big deal for the freight industry this year. “It would be a blip.”

Whatever the next few days bring, companies are likely better equipped to respond than before the pandemic, when lockdowns threw global supply chains into turmoil. “When I first got into the industry it was all about ‘just-in-time,'” says Long, who has worked in the grocery industry for years. The pandemic made retailers and the freight businesses that support them more focused on stockpiling stock and avoiding the unexpected. “We’re kind of in a better place,” he says.