5 ways technology could help transform the logistics business
Posted on October 30, 2019 by Radhika
Looking at the way and pattern in which we are linked to technology, it’s hard to imagine life without it. Through the years, technology has been instrumental in shaping and bettering any sphere, vertical or life, per se. It plays a vital part in the future of logistics business, too.
The global logistics industry market worth was around USD 10.32 billion two years ago and is expected to cross USD 12.68 billion by 2023. In these times, globalisation has made the logistics industry more aggressive. Keep reading to learn how best technology can be tapped in the field of logistics business.
1. Integration of multiple platforms: To stay on top
of things and thereby, maintain relevance, any organisation must go with the
flow, so to speak. Logistics enterprises must maintain transparency and
honesty, especially when it comes to communication among customers, employees,
management and stakeholders. With large consumer orders, resources and money in
the mix, communication needs to be stark, round-the-clock with nil down time.
You know what they say – 1 customer or consignment gone awry could just be the
beginning of worse things ahead.
Luckily, unlike olden times when supply chain vendors resorted to dated forms of communication, things have changed much for the better. Thanks to technology, today communication is simpler, faster and better. Organisations can integrate mobile apps for logistics business with other third-party applications to form a centralised platform of communication, paving the way for 100% of order fulfillment and customer satisfaction.
2. Big Data to the rescue: Sure, math and voluminous
data may not be everyone’s cup of tea. But with real-time analysis of big data,
logistics stands to gain. Getting it done manually is next to impossible given
that it would be a mammoth task at hand. The slightest slip, error or lack of
attention to detail, can lead to lasting repercussions. Thanks to big data that
requires zero human intervention, thus saving on time and labor.
As far as logistics is concerned, big data helps in
identifying trends of purchase patterns and customer behaviour, thus helping in
company performance and efficiency. Big data also helps in identifying the
challenges and loopholes that may arise with any consignment, closing gaps and
learning from errors. With AI and big data, companies can optimise processes to
develop predictive maintenance solutions. With experienced analysts who can
interpret data on one’s side, logistics companies can expand in no time!
3. Blockchain: “A blockchain is a growing list of records, called blocks, that are linked using cryptography. By design, a blockchain is resistant to modification of the data as it is an open, distributed ledger to record transactions between two parties efficiently and in a verifiable and permanent way”. How can blockchain help in logistics business, you ask? Well, it betters transparency for customers and handholds them to view the entire journey a product takes before getting delivered. Knowing that their product would reach the right hands at a prescribed time ensures more trust in the buyer. Also, it’s a fail-safe method so as not to fall into fraudulent or wrong hands.
An interesting point to note is that value-added services
such as trade facilitation has ceased to exist thanks to blockchain as it
enables all types of payment. Experts augur that blockchain is one of the most
favorable technologies in logistics with the prospect to digitise the prevalent
paper-based processes and overcome the multitude of different interfaces.
4. Internet of Things: To streamline business processes
efficiently, logistics firms have been quick to embrace and jump on to the IoT
platform. Coined by Kevin Ashton back in 1999, IoT is a reality, especially in
transportation systems, robotics and manufacturing procedures. Steadily growing
year on year since the turn of the century, IoT is projected to reach 50
billion objects by 2020. By tightening supply processes via sensors, IoT
solutions support smarter warehouse management.
Additionally, with the restructuring of planning and service
delivery, IoT or ‘telematics’ as it’s widely referred to, in the field of
transportation, helps bring down expenses drastically. IoT operates on 3 levels
– connected hardware, infrastructure and the software tier. Successfully
obscuring the line between digital and physical, any consignment is foolproof
and trackable. Moreover, IoT can better businesses by gauging demand thanks to
historical data available. In the coming years, telematics
could trigger an economic growth of $1.9 trillion on logistics and
supply chain management.
5. Outsourcing: Predictably, businesses are forever
looking to control costs at every corner. And that’s precisely the reason why
the road ahead for 3PL or third-party logistics looks rosy and robust. 3PL or
outsourcing helps shrink overhead costs drastically and profit from vendor and
supplier expertise. As per a recent study, two key trends emerging in the 3PL
sector are close relationships between shippers and 3PL providers and the
predictable impact of digital technologies on the space, including automation
3PL is set to flourish steadily in the coming years, as
logistics companies continue to demand customised on-demand transportation,
warehousing, distribution and freight services. 3PL market is perched to grow
at a CAGR of 5.77 percent to 2022, and as per Forbes
Insights, going forward 61 percent of companies will trust
significantly more on external providers for supply chain and transportation
To sum up, using sensors and deep diving into the digital
realm can assist logistics businesses procure improved margins and make
profitable decisions to better their bottom lines.