Skip to Content

Blog

8 Major Trends Shaping Logistic Management in 2022

Disruptive forces are always at work, transforming the way organizations think about technology, conduct business, and look to the future, regardless of industry.
This is particularly true in the logistics industry, where market movements have a significant impact.
To stay on the cutting edge and remain competitive, logistics organizations must stay on top of new and emerging trends, from new technology to explore and take advantage of to shifting regulations that necessitate new strategies and tactics to assure compliance.
Companies that prosper are those who combine the latest trends and apply them in a way that takes advantage of both old and established technologies.
What impact will current logistical developments have in the future?

1. RFID

Radio-frequency identity (RFID) chips have offered real-time tracking information for over a decade. While many out-for-delivery (OFD) companies have spent a lot of money on RFID, they have yet to see a substantial return on their investment.
So, why is that?
Simply having RFID chips does not guarantee that you have better access to the data because you require computers to collect and exchange the data.
Companies also require file-based integration technology that can connect devices and edge computing systems to core corporate systems in order to send reporting documents and store and analyze data for insight and business decision-making.
Furthermore, logistics organizations that are able to combine traditional line-of-sight technology such as barcode labels with RFID are the ones that generate the most value. Barcode labels are well-known and reasonably inexpensive. The underlying systems and processes are well-known and widely used.
On the other hand, RFID deployment might be a high-cost addition to the logistics supply chain. RFID tags are estimated to cost 10 times more than bar codes, according to some estimates.
One reason a hybrid approach to old and new makes sense is the price barrier for investment. Additional considerations about data accuracy and dependability should be factored into a company’s RFID strategy.
However, there are feasible uses that businesses should consider.
RFID offers a lot of potential in logistics, especially for route optimization and real-time tracking of shipments. RFID systems, when properly connected, may offer exact position and quantity data in real-time. Tagging vehicles, pallets, and inventory, for example, enables multi-lateral views of what’s going on along the supply chain.
Knowing where a specific truck is at any given time allows a logistics company to be more proactive, changing a delivery route in the event of unforeseen circumstances such as accidents or bad weather.
Companies that successfully combine classic and legacy technologies with next-generation developments are the most successful. Those businesses recognise that trying to entirely replace existing technology and business processes is a bad idea. When new technology is used in conjunction with what is already established and standardized, it tends to perform better.

2. Omnichannel Shipping

Omni-channel fulfillment is becoming more common in the logistics business, fueled by a shift in the retail industry’s approach to meeting customer expectations.
The Amazon effect, according to the Harvard Business Review, is driving established merchants to provide more omnichannel touchpoints in order to boost consumer loyalty. The goal is to make shopping as fluid and simple as possible, whether it’s done online or in person.
In this setting, effective logistics organizations are those that have evolved to offer more inventive shipping ways in order to traverse the supply chain’s expanding omnichannel complications.
A simplified view of probable omnichannel fulfillment and return order flows to (and from) the final customer is shown below:
  • Warehouse to consumer and back
  • Supplier to consumer and back
  • Store to consumer and back
  • Distribution center to consumer and back
Futuristic omnichannel Traditionally, shoppers would travel to the object they had purchased. As a result, the consumer was responsible for the “final mile.” Now, retail logistics companies and their partners are responsible for last-mile logistics. Retail logistics deliveries are now expected to function similarly to USPS deliveries. In reality, because their system is already in place, corporations like Amazon hire USPS to make these deliveries.
Walmart is taking a novel approach to the problem of last-mile logistics. They’ve established an employee drop-off system that encourages workers to drop off packages on their way home at the end of the shift. Walmart also bought Parcel, a last-mile delivery company based in New York, in September 2017.
The last-mile evolution of shipping methods has enhanced the supply chain’s complexity as a result of e-commerce and omnichannel trends. Furthermore, one-way logistics is no longer sufficient to compete.

3. The Big Promise of Big Data

UPS could be the biggest big data success story in the logistics sector. The organization has achieved huge achievements in operational efficiencies and cost savings thanks to data collecting, analysis, and demand forecasting.
Over 200 onboard sensors in each of the 80,000 vehicles measure speed, braking, backing up, location, and idling time. Some of the sensors capture diagnostic data on the battery and tyre pressure of the car, enabling for proactive maintenance. The idea is to keep a car on the road as often as possible rather than in the shop. Furthermore, big-data-driven predictive modeling is the foundation for enormous route optimization improvements.
Companies may now maximize delivery windows regardless of construction, parades, accidents, and other factors thanks to the growth of GPS and position sensors, as well as real-time traffic information. Big data technology allows businesses to establish systems that allow them to adjust their routes in real-time. There are several causes for this.
The first is, obviously, to reduce fuel use. UPS used big data to cut fuel consumption by 1.5 million gallons in 2012, lowering environmental impact and enhancing operating profitability.
Reduced mileage is another big data result connected to route optimization. The amount of mileage reductions that firms achieve has an impact on vehicle wear and tear.
UPS has a unique method of specializing in inefficiency. UPS “trucks never turn left,” according to their CEO. When a route optimization specialist plans out the best route, they exclusively provide drivers with right-turn directions. It’s a novel approach to reducing the amount of time a car spends stopped at red lights, and it works.
While some foresighted businesses are beginning to engage in greener technologies and big data efforts. Many supply chain organizations are developing new strategies that are similar to the results of route optimization through inventory logistics management and the optimization of shipments for efficiency.

4. Embedded Integration Technology

Embedded technology is also being used by logistics organisations to better engage with their clients. They know that they require a data mobility platform to transmit data reliably across their clients in a smooth manner.
Embedded integration capabilities enable logistics SaaS firms to provide value-added services involving logistics and supply chain data. As more traditional logistics companies evolve into data-centric services companies, this is a perfect encapsulation of digital transformation.
Modern services and solutions are being used by businesses to collect data, process it, and deliver insight to customers. The capacity to be more dynamic than ever before by giving customers with timely and vital information is critical to a company’s success.
An embedded data platform allows robust transactional business flows by providing secure communications protocol flexibility. Through features currently integrated into the system, you must be able to connect, transform, and combine data. Customers need complete transparency, and information is critical. Companies are using embedded software with business-level dashboard views and 24/7 monitoring to extend visibility throughout the process and assure compliance with strict SLAs.

5. Globalization and Compliance

Many logistics organisations are being forced by globalisation to focus on a strategy of meeting delivery KPIs while keeping costs low.
The requirement for improved supply chain flexibility is critical, as is the recognition that no single solution to the expanding complexity will fit all.
The global trading landscape is continuously changing. The necessity for logistics firms to remain abreast of changing compliance standards is consistent.
This is especially true for the various ways in which the company must manage crucial customer and partner data.
Consider the Federal Maritime Commission’s latest effort to change regulatory priorities. One recent governance change had a direct impact on the New York Shipping Exchange and was intended to prevent shippers from leaving less profitable cargo behind. While this is a beneficial shift, it is nevertheless a change – one that is occurring more frequently throughout the world.
Furthermore, a company’s ability to find, view, record, and report on data is coupled to its ability to comply with a profusion of data-related laws around the world. Full auditability is required by the rule, and businesses must provide full audit trails to follow their own and their customers’ data throughout the process, with built-in governance and management.
Trucks might be stuck at the dock, ships could get stalled in the harbour, and products could be stranded on trains or tarmac for hours or even days if they don’t have the ability to comply with demonstrable digital paperwork.
A rejected food logistics shipment due to non-compliance might cost anywhere from $300 to $40,000. And, when projected to a worldwide scale, the cost of not being able to move products on is enormous.

6. Integrated 3 PL Services

Many organisations are seeing a lot of promise in integrated 3PL services as e-commerce continues to grow beyond epic proportions. To enable deep integration into customers’ systems, businesses are bringing in heavy assets in trucking and adding freight brokerage capabilities and storage facilities.
In addition to traditional EDI, logistics organisations are embracing logistics automation trends by employing API connectors to connect e-commerce stores with fulfilment centres as clients advance through their own use of modern technology.
Because supply networks have so many diverse channels and vary so frequently to suit customer demand, fulfilment methods must grow to keep up in order to deal with COVID-19 and other supply chain disruptions.
Customers want delivery options, from last-mile services to same-day and next-day delivery, and it is up to providers to ensure that customers have those options.

7. Re-Optimized Service Lines

When COVID-19 first hit, one of the first things logistics businesses did was re-optimize service lines to focus on industries that did well during the pandemic, such as food, paper, and packaging.
This allowed these logistics companies to have a more consistent fleet rather than a haphazard, non-dedicated fleet. No, transitioning and pivoting strategic initiatives is not simple for businesses, but the ultimate outcome is one that will benefit them for years to come.

8. Embracing Modern Integration Technology

Companies in the logistics industry are seeing the value of modernising their outdated systems and moving to a modern integration platform.
The attractiveness of a modern integration platform is that it allows logistics organisations to conduct business more quickly by allowing clients, trading partners, and suppliers to be onboarded more quickly and providing end-to-end visibility.
Modernized integration technology can handle everything from frictionless supplier integration to the capacity to open back-office systems that are vital to third-party logistics (3PL) services. Every logistics company understands the importance of integration technology in their supply chain.
Companies that switched to a contemporary integration platform before COVID-19 were in the best position to handle supply chain disruption. The need of a contemporary integration platform was highlighted at COVID-19.

Conclusion

The logistics sector now looks nothing like it did ten years ago; the issue now is, what will it look like in another ten?
Market trends like the ones mentioned above will continue to have an impact on the logistics industry well into the future. However, trend-shaping fledgling technologies must be linked with current solutions and infrastructure to be successful. Not only must logistics operations be capable of processes like swallowing an EDI load tender, but they must also consider how future technology might be used to lower margins. Businesses can then build a next-generation stack that builds on earlier technology investments while also experimenting with big data, IoT, and omnichannel solutions.

0 Continue Reading →

Need to Focus on Supply Chain Resilience

The supply chain situation is unlikely to be resolved before the first half of 2022, thus the strategy going forward will be to keep implementing remedies and improving resilience.
The going has been tough, and the future appears to be grim. On the wharf, cranes could be seen idling. The vessels couldn’t dump the import containers because there wasn’t enough room in the yard. Almost every link in the global supply chain has become tangled in a logistical knot in the last two years, causing various trade bottlenecks along major routes. There have been massive port closures, both in terms of time and number. The interruption has been significant, and the ramifications have been disastrous.
The manufacturing units were the first to succumb as the pandemic extended its tentacles. In the early days of the pandemic in 2020, a labour shortage caused manufacturing to be disrupted. An exponential drop in output statistics impacted major manufacturing areas in China, South Korea, and Taiwan, as well as huge industrial cities in Europe.
The impact on output was manifested in a variety of ways. Due to a lack of chips manufactured in Taiwan and Malaysia, computer production in China has dropped substantially. Vehicle production has slowed as well. All of this had a global influence. In the United States, commonplace commodities like toilet paper and straws, as well as crucial items like protective gear for doctors and pharmaceuticals, were in limited supply.

What is a resilient supply chain?

The ability for resistance and recovery defines a resilient supply chain. That implies being able to withstand, if not completely prevent, the effects of a supply chain disruption, as well as quickly recover from one. Multiple sections of the supply chain are vulnerable to operational risk and disruption. As we saw with COVID-19, worldwide disasters can have a far-reaching, global impact on supply chain logistics, suppliers, and workforces. Unexpected competition, unanticipated market movements, or even rapid changes in customer’s shopping behaviour can all cause supply chain disruptions.

Problems in Current Supply Chain

From product shortages to facility closures and beyond, the COVID-19 epidemic wreaked havoc on every local, national, and global supply chain.
Shippers and carriers all across the world have persevered, and they continue to transport and deliver goods on a daily basis.
Challenges that shippers are facing in the current supply chain –
  1. Keeping the transportation costs down
  2. Keeping up with the customer/industry demands
  3. Sourcing consistent, reliable carrier capacity
  4. Keeping up with the latest technology solutions and demands
  5. On-time pickup and delivery performance

It’s All About The Money

Controlling freight costs is an age-old concern in the transportation sector, and it has become even more so in recent years for shippers.
Shippers had been facing escalating costs owing to our location in the truckload market rate cycle even before the pandemic, and the COVID-19 volatility made it significantly more difficult.
Most shippers were having financial difficulties, whether sales had slowed or increased, and freight prices were not helping.
Another important aspect was the shortage of truck drivers, which occurred as a result of drivers’ inability or unwillingness to work during the pandemic.

Fast & Free Shipping is Pressuring Everybody in the Supply Chain

Customer demands for faster, cheaper service — so called the “Amazon effect” after the e-commerce behemoth’s expanding dominance — have amplified pricing difficulties and put a pressure on an already stressed carrier supply.
Even in business-to-business transactions, the two-day free shipping that has become the standard in ecommerce has set expectations for everyone.

Keeping Up in the Technology Arms Race

Concerns among shippers about keeping up with the latest technological solutions and demands might be observed as a result of ongoing competitive pressures.
When a new tool for analytics, forecasting, or any other area of logistics is brought to the market, it’s normal to be concerned that your competitors will invest in it.
Are your competitors already reaping the benefits of new technology and prepared to overtake you?
Challenges that carriers are facing in the current supply chain –
  1. Keeping the maintenance and the operational costs down
  2. Keeping up with customers/ industry demands (better, faster, cheaper)
  3. The unexpected delay in time
  4. Keeping up with the latest government regulations
  5. Access to a person when we have transportation/ logistics issues
Another difficulty we can see in last year that strained carriers were:
  • Maintenance costs rose – Tools and parts were entangled in the same insecure supply chains that carriers do.
  • Unplanned delay become more common – Trucks were stranded more frequently than usual during the pandemic due to facility closures and understaffing.
Consumers pressure retailers, retailers pressure their suppliers, these suppliers pressure their suppliers, and everyone pressures carriers.

Benefits of the resilient supply chain?

Availability

The availability of a resilient supply chain is the first benefit. You can get real-time inventory data and adjust to global limits with quality operating systems. This provides you and your suppliers with peace of mind in the event of unforeseen weather-related incidents or disasters. Even if one area experiences a blackout, you can still acquire the most up-to-date information about your system from another place with the touch of a button.

Flexibility and Configuration

Unexpected disasters do happen, and your company must be prepared to deal with them. You may be ready for anything with original setups from any device using cloud-based software, eliminating the need to set up a new machine. You can also engage with your vendors to modify the flow of products based on changes you make at your facilities or distribution locations with resilient supply chain management. Because of this interconnection, you have complete control over how you manage your inventory and respond to problems.

More Control

To have total control over your business, you must be able to view and know where your inventory is at all times. You can have a single view of your inventory throughout your whole network by using cloud-based software and partnering with a third-party logistics provider. You will have better control over your business as a result of this visibility.

Contact Freightlinks International for Low-Risk Supply Chain Management

Storms can come and go without impacting your business if you have the correct supply chain management in place. You can plan for future issues and be ready with solutions that help you and your suppliers with resilient solutions, excellent inventory management, and other helpful supply chain services.
Whether you’re a small or medium-sized business, a third-party logistics supply chain provider can assist you to deal with the obstacles of growth.
If you are looking for the right company to partner with, Freightlinks International is the right answer for this. Visit freightlinksindia.com for more information.

0 Continue Reading →