The period between 2020 and 2025 was extraordinarily eventful for logistics worldwide, as businesses grappled with the impacts of pandemic shutdowns, geopolitical issues, port congestion, and extreme weather. These events exposed a critical weakness: Many companies, including major enterprises, have yet to build supply chain resilience.
To help your organization better prepare for such occurrences, we examine key lessons from the 2020-2025 period and look at strategies you can adopt to reduce your risk.
Table of Contents
- What Did 2020-2025 Teach Us About Supply Chain Fragility?
- How Are Leading Brands Building More Resilient Supply Chains Today?
- Is Your Fulfillment Partner Part of Your Resilience Strategy?
- What Does Supply Chain Resilience Look Like in 2025 and Beyond?
- Build Supply Chain Resilience With AMS Fulfillment
- FAQs
What Did 2020-2025 Teach Us About Supply Chain Fragility?
The 2020-2025 period revealed the vulnerability of efficiency-first supply chains. Companies that were prioritizing cost reduction found themselves struggling to secure inventory, meet customer expectations, and maintain customer satisfaction in the face of multiple disruptions:
- COVID-19 pandemic: According to a 2025 Ernst & Young report, national pandemic lockdowns slowed, and in some cases completely halted, the distribution of raw materials and finished products. They also caused staff shortages and temporarily shut down some factories, making it difficult for companies with hyper-lean inventories to continue operations.
- Suez Canal blockade: In 2021, the grounding of the Ever Given for six days at the Suez Canal delayed the delivery of products worth billions of dollars. This event highlighted the susceptibility of global supply chains to physical bottlenecks.
- Red Sea crisis: Geopolitical tensions and escalating conflicts in the Red Sea forced many shipping companies to reroute vessels to the Cape of Good Hope in South Africa. While a safer move, it added days of transit time, causing production delays or suspensions for companies with lean inventories.
- Semiconductor shortage: The unexpected surge in demand for electronics during the pandemic, coupled with overreliance on East Asia for chip production, led to a shortage. This revealed flaws in the “just-in-time” inventory model and single-source supplier dependency.
- Extreme weather conditions: Hurricanes, floods, droughts, and wildfires impacted factories, ports, warehouses, and transportation, causing supply chain disruptions at every stage.
- Los Angeles/Long Beach port gridlock: In 2021, the ports of LA and Long Beach recorded unprecedented congestion, leaving over 70 ships idling in the bay carrying an estimated 500,000 containers. The major delays exposed supply chain risks across global supply chains, such as overreliance on a single geographic chokepoint and interconnected supply networks.
One of the clearest lessons from the 2020-2025 period is that the “just-in-time” model for inventory management can be risky. While long viewed as an effective way to eliminate waste and cut supply chain costs, an overly restricted inventory could also be a major vulnerability, sometimes leaving businesses unable to meet customer needs.
Another key lesson is that single-source dependency creates systemic risk. Many organizations had to slow or halt their processes because they relied on only one supplier or transportation route.
The period also highlighted the bullwhip effect, a supply chain phenomenon in which changes in customer demand lead to larger fluctuations in orders placed upstream. The rise in demand for electronics during the pandemic, for example, contributed significantly to the global semiconductor chip shortage.
The Shift From “Just in Time” to “Just in Case”
Given the “just-in-time” vulnerabilities exposed by supply chain disruptions over the years, many brands have shifted from maintaining lean inventory to holding strategic buffer stock. Buffer inventory can protect your business against unforeseen disruptions in supply and demand, allowing you to maintain business continuity.
Safety stock can also be a competitive advantage. It allows you to meet demand when competitors face shortages or stockouts, potentially increasing sales and enhancing customer satisfaction and loyalty.
The trade-off for implementing the “just-in-case” model is higher carrying costs. More inventory means higher warehousing, utilities, admin, and insurance costs.
The good news is that you can balance holding costs against the risk of a stockout by working with third-party logistics (3PL) providers. 3PL partners minimize the need for fixed investments by offering on-demand storage and warehousing support. They can also reduce your risk of over- and understocking by tracking inventory on your behalf through dedicated inventory management systems.
How Are Leading Brands Building More Resilient Supply Chains Today?
Before 2020, brands typically worked with a small number of suppliers to streamline management and reduce costs, often prioritizing efficiency over building resilient supply chains. However, after events such as the semiconductor shortage and the Red Sea crisis, leading organizations are moving from single-source dependence to multi-source procurement to build supply chain resilience.
One of the biggest supplier diversification strategies has been the adoption of regionalized supply chains. Rather than getting products from distant, low-cost countries in East Asia, brands are sourcing more from nearby North American countries (nearshoring) and bringing offshore production back to the U.S. (reshoring).
According to the Fictiv State of Manufacturing 2024 report, nearshoring is growing, with 53% of surveyed brands planning to move more production to Mexico and Canada. Mexico is a particularly popular option for manufacturing operations, reducing transit times while offering friendly trade policies. The country also has a more affordable workforce; the wage differential between the U.S. and Mexico in manufacturing and production sectors can be up to 80%.
Beyond diversifying sourcing, resilient brands are also investing in:
- Long-term supplier relationships: Brands are moving from purely transactional purchasing. They now build stronger vendor relationships by signing multi-year contracts, supporting suppliers’ development programs, sharing real-time inventory and capacity data, and even collaborating on sustainability initiatives.
- Risk mapping: Leading companies identify and score supply chain risks across their entire supply chain networks instead of waiting for disruptions. They then develop contingency plans to reduce or address the more significant risks.
- Technology: Brands are investing in technologies such as AI-driven demand forecasting tools and supplier collaboration platforms to mitigate risks and improve preparedness and vendor relationships.
- Transportation redundancy: Following disruptions caused by events such as the LA/Long Beach crisis, brands are building redundancy into their transportation by working with multiple carriers and expanding distribution centers.
The Role of 3PL Partners in Resilience Planning
Partnering with 3PL providers is among the most efficient supply chain resilience strategies. A reliable 3PL partner can provide additional, scalable warehouse space and labor, especially valuable during unexpected demand and disruptions. With AMS Fulfillment as your partner, for example, you can scale your capacity up or down based on demand to reduce the risk of product shortages and delivery delays, without drastically increasing your overheads.
A partner with distributed fulfillment networks can further reduce your supply chain risks by minimizing geographic concentration. With multiple distribution centers, you can store products in the areas closest to your customers and reroute inventory to new warehouses when disruptions occur at specific locations. Thanks to AMS Fulfillment’s bi-coastal warehouses, you can efficiently serve East and West Coast customers and minimize business disruptions if events such as natural disasters occur on one coast.
3PL partners also improve supply chain operations by providing diversified transportation networks, real-time inventory data, and complex fulfillment services such as kitting. AMS Fulfillment maintains a supply chain network through its relationships with multiple carriers, giving you alternative options when specific routes or delivery services become unavailable. We also offer inventory management services to help improve supply chain visibility, as well as Value-Add Services (VAS) for greater operational flexibility.
Technology as a Resilience Enabler
Digital supply chain technologies enhance resilience by improving visibility and informing decision-making across supply chain operations:
- Cloud-based inventory management tools provide real-time supply chain visibility across warehouses, minimizing unexpected shortages.
- Machine learning models, powered by artificial intelligence, analyze historical and real-time data for demand forecasting, help anticipate market fluctuations, and minimize the risk of over- or under-ordering.
- System integrations among brands, suppliers, and fulfillment partners reduce silos.
- Scenario-planning tools allow you to test “what-if” scenarios for better contingency planning.
Is Your Fulfillment Partner Part of Your Resilience Strategy?
Your 3PL partner can be a great asset to your supply chain management, but only if you find the right one. Choose a partner with supply chain resilience to protect your operations.
A reliable fulfillment partner like AMS is built for eCommerce and B2B brands, offering:
- Redundant facility locations
- Contingency plans for facility-level disruptions, such as inventory rerouting in case of extreme weather
- Supply chain technologies that offer real-time inventory visibility
- System integration capabilities between their technologies and yours for seamless collaboration
- Scalable capacity models to meet your needs as product demand increases or decreases
Look for a service-level agreement (SLA) that defines performance expectations and establishes accountability in the event of supply chain disruptions.
What Does Supply Chain Resilience Look Like in 2025 and Beyond?
Supply chain disruptions can have enterprise-wide consequences, from reduced revenue to damaged brand reputation. Because of these impacts, supply chain management conversations have moved from operations departments to boardrooms, with businesses treating resilience as a strategic priority.
Brands have become susceptible to regulatory pressures and increased geopolitical volatility. For example, under the Uyghur Forced Labor Prevention Act (UFLPA), importers bringing products manufactured in China’s Xinjiang region into the U.S. must prove that the items weren’t made using forced labor. Organizations may also need to transition from global to regional sourcing due to ongoing U.S.–China trade tensions and evolving tariff policies.
Organizations are also facing growing pressure to maintain ethical and sustainable supply networks. Increasing calls for supply chain transparency make integrations between brands’ and 3PL partners’ systems non-negotiable.
Build Supply Chain Resilience With AMS Fulfillment
Businesses that strengthen their supply chain operations are better positioned to improve their profits and competitive advantage. So don’t get left behind.
Partner with AMS Fulfillment to enhance your supply chain management and resilience.
FAQs
What is supply chain resilience?
Supply chain resilience refers to the ability to anticipate, prepare for, withstand, and recover from disruptions to your business’s supply, helping ensure business continuity.
How can a 3PL help improve supply chain resilience?
A 3PL partner can help you build more resilient supply chains by providing:
- Scalable warehouse capacity
- Real-time inventory visibility
- Access to diversified carrier networks
- Distributed fulfillment centers
- Demand forecasting support
How much safety stock should a business carry to be resilient?
There’s no universal ideal amount of safety stock. The right amount depends on a business’s demand volatility, supplier reliability, target customer service level, lead times, and stockout vs. carrying costs.
