Filenews 13 July 2025 - by Charalambos Zakos
"Logistics is an unpredictable cost factor. It can bring you profits or destroy you", say the Business Consultants, wanting to show that this sector hides a big nightmare for entrepreneurs, which affects not only small and medium-sized but even the largest multinational companies.
And if for the average citizen this problem seems foreign, affecting some others, we have bad news: Every disruption in the supply chain, every uncertainty and every new crisis affects even the last citizen of each country.
This is because the seller will pass on to each buyer any increase in logistics costs. Of course, problems in the supply chain do not only translate into costs but also into quality of service.
From the condition in which you will receive your order, to when you will receive it, depends mainly on what we call logistics. Therefore, any new problem, even if it does not translate into price increases, will affect you, either in one way or another.
It affects us all
: "Supply Chain Problems", "Supply Chain Impact Fears" and so many other headlines often make their appearance in the Mass Media.
Citizens, in every new geopolitical crisis, are bombarded with these concerns, which most of the time go unnoticed by the average citizen, since he considers that it is a problem that does not touch him and will not affect him.
After all, he is neither a shipowner, nor an entrepreneur, nor a merchant. However, a small disruption in this chain is enough to create chain problems even for the last consumer of each country.
Simply put. Every disruption in the supply chain affects every part of the economy. Logistics is about everything in trade. From placing an order by an interested buyer to receiving it.
The examples are many and have made history because of the problems they caused.
The "dark side" of trade
It would not be an exaggeration to say that logistics is the "dark side" of commerce, since behind every product that reaches our shelf or door, there is an invisible, but often huge cost, which the consumer does not fully understand.
Essentially, logistics is not only about the transport of products but about different services that must be synchronized like a well-tuned clock in order for everything to work as expected.
This "dark side" concerns costs for storage, transportation, inventory, order management, returns, but also customs and customs fees.
In fact, according to analysts, logistics can correspond to 10% to 25% of the final price of products, while in sectors such as food or agricultural products, the percentage can be even higher.
The main concern and problem that businesses and by extension the buyers themselves have to face are the fluctuations in the prices of transport which not only cannot be predicted, but in some cases can be so abrupt that they skyrocket the price of the product within a few hours.
The Battle of Containers
The most typical example of the serious problems that can arise due to various factors, was the surge in container prices during the coronavirus pandemic.
For example, in 2019 (pre-covid) the price for a container ranged between $1,500 and $2,000.
At the beginning of the crisis, these prices increased, while at the peak of the pandemic crisis in 2021, prices in some cases even reached $15,000 to $20,000.
The explosion in freight rates by about 700% was a result of the ports being closed, the lack of containers that were "trapped" in ports, but also the high demand that arose from consumers, combined with the reduction in production and the lack of raw materials.
It should be noted that during 2022, i.e. the period of the Russian invasion of Ukraine, container prices reached $10,000.
The first major price de-escalation was in 2023, with prices reaching up to $4,500, while in 2024-2025 there was a further de-escalation, falling to $4,000.
However, although prices are now at normal levels, however, due to geopolitical instability, uncertainty remains. What analysts seem to agree on, however, is the fact that container prices will never fall again to the prices they were before the coronavirus crisis.
However, so far 2021 and 2022 are considered the worst period in the history of shipping and supply chain in terms of costs.
The supply chain
As we wrote above, the supply chain, due to the many different factors that can affect it either directly or indirectly, is vulnerable to severe and extraordinary fluctuations.
Characteristically, it should be said that when recording important events that affected logistics, it is extracted that every year, in the last five years, it has had its own challenges that have affected, sometimes more and sometimes less the supply chain.
There are many examples, most recently fears of the closure of the Strait of Hormuz in response to Iran's attack on Iran's nuclear facilities.
-2020: Beginning of the coronavirus pandemic. Quarantine, closed factories, shortage of raw materials and personnel and a large increase in orders
-2020-2021: The shortage of containers that resulted in soaring fares and months of delays in product deliveries
-2021: In March, the ship Ever Given ran aground and closed the Suez Canal for several days, causing significant delays in the delivery of products to Europe and huge economic losses.
-2021-2022: The energy crisis after the recovery from the pandemic, which resulted in increases in production and transport costs.
-2022: The start of the Russian-Ukrainian war resulted in an energy crisis, a shortage of grains, metals and files and in general the commercial decoupling of Europe from Russia.
-2023: The climate crisis also affected the supply chain, after severe shortages in products and natural resources
-2024: The technology war and restrictions between the US and China have resulted in a global shortage of technological products, especially semiconductors, resulting in production delays
-2025: Trump's trade war, with an increase in tariffs, as well as geopolitical developments in the Middle East, have resulted in severe turbulence and a climate of uncertainty
Headache for small and medium-sized enterprises
Supply chain problems make the difference between profit and loss for an entrepreneur, with small and medium-sized enterprises under the most pressure.
On the other hand, with each new disruption and uncertainty, consumers see an increase in prices, additional shipping costs, but also a worse quality of service, such as delays or damaged products.
Cyprus and its citizens, as an island state that depends exclusively on maritime transport, is called upon to deal with many peculiarities and turbulences, which are most often beyond its capabilities.
In addition, more than 90% of Cypriot companies concern small and medium-sized enterprises that are much more affected by any problem in the supply chain than multinationals.
The lack of liquidity and high costs burden small and medium-sized enterprises, which have to cope with sudden increases in costs and unforeseen expenses.
After all, in Cyprus we have experienced many times what each disruption means, but also the challenges that the supply chain has.
If we take simple examples in Cyprus, we will see the extent to which we are affected: In times of crisis, we had seen long delays in the delivery of cars from abroad.
While in more serious problems – such as the replacement of the problematic TAKATA – problems in the process of their replacement and delays had been recorded, since the import of spare airbags and the time until they arrived in Cyprus was a great challenge not only for the general distributors, but even for the competent Ministry itself.
