2H 2020 Distribution & Logistics M&A Report

As in most sectors across the globe, COVID-19 challenged long-held assumptions and assertions throughout the distribution and logistics space. Global devotion to “Just In Time” delivery was shaken as supply chains dried up, borders closed, warehouses emptied, hospitals scrambled to find ventilators and, gasp, the toilet paper disappeared. The great toilet paper famine of 2020 made for humorous late night television commentary. But shortages of other items had deadly consequences. The lack of adequate PPE (personal protective gear) and medical supplies for hospitals – respirators, gloves, face shields, gowns – was serious. In Italy, healthcare workers without PPE suffered infections and death even during the earliest stages. The disruption caused by COVID, and perhaps also a trade war, didn’t just cost lives; it cost money. Automakers around the world struggled for supplies. Entire automotive model lines were delayed. Dealers in Chicago reported running out of cars to sell as 2020 ended. Maybe blame all this on Toyota. Toyota pioneered a Just In Time supply chain over five decades ago. The company arranged to keep the bare minimum of components in storage – and for delivery only as completed vehicles left the factories. As the system took hold in the 1970s, it proved efficient, with less time spent storing things. It worked great, until it didn’t. The weakness as we’ve now seen, is when even one part of the supply chain suffers a glitch. The year 2020 definitely falls under the heading of “glitch.”…

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