What Is The Future Of The Logistics Industry?

The world is getting smaller because of technology. This also applies to the logistics industry. While goods still need to travel the same distance to reach the final destination, the ease and the time it takes can definitely be shaped by advancements in technology. Imagine a world where packages or products can reach the other side of the planet without even passing through human hands.

What Is The Future Of The Logistics Industry? 

If you are in this industry like a third party logistics company in Melbourne, there are many possibilities that may impact your business greatly once these technological trends become real. In fact, there are many limitations in the current process of shipping nowadays that there is so much room for growth and automation. 

Challenges to the Logistics Industry

Logistics, especially international shipping, is time-consuming and brings with it a huge risk of damage to goods. Worse, products may also just disappear and leave no trace. All of these issues and others can now be addressed by current improvements. 

  • Shifting Customer Desires

Demand changes every day, and many companies pay top dollar to anticipate this. It impacts how much of the goods they will order, and the more accurate they are, the less product and money gets wasted. Because this may change so quickly, by the time an audit is done, the numbers may have already changed. 

  • On Time Deliveries

There are too many factors that leave logistics companies vulnerable to late deliveries. The issue becomes worse when perishable items are to be transported, as something as simple as a union strike can cripple the whole network.

  • Lack of Infrastructure and Low Capacity

As populations increase and demand grows, there is an increasing need for infrastructure that can process this higher volume. Although many logistics companies are now investing in bigger container ships, they tend to be less environmentally-friendly. Moreover, local transportation or distribution is also to be incorporated in this planning. In many less developed countries, the infrastructure to transport products may simply not yet exist.

This refers not only to the safety of products during transport, but also in the warehouse and during delivery. Damaged goods will lead to lost sales or smaller profit margins.

Future Trends in the Logistics Industry

In order to address the following challenges above, it is necessary to use technology not just to address it, but to also automate the many steps. In doing so, not only are the issues resolved, but the process can be made simpler, quicker, and cheaper.

  • More Widespread Adoption of Transportation Management System (TMS)

Though not necessarily new, TMS used to be only utilised by larger players in the shipping industry, due to price. But the growth of cloud-based logistics solutions is making it more prevalent, with small to medium-sized shipping companies adopting these software-as-a-service (SaaS) applications. This has allowed them to compete with their bigger competitors.

Old TMS systems used to be only available on site, while today’s cloud and web-based versions mean it can be easily accessed from anywhere with Internet access. This has been the biggest reason for the fall in prices. Because it brings a significant return on investment (ROI) for companies that adopt a TMS system, TMS cloud-based software has been growing at about 7.5%. Shippers are then able to reallocate these funds to other costs or increase savings.

  • The Rise of Autonomous Vehicles and Drones

From Google and Apple’s efforts in developing self-driving cars to Amazon’s plans of using drones in the delivery of orders, customers will be receiving their goods without interacting with a human being in the future. In fact, there are quite a number of companies rushing to be the first to offer this service that may change logistics forever.

Even now, there are efforts to connect self-driving trucks to a manned one in front, which will already impact fuel efficiency. This will not just impact delivery time and bring savings in fuel costs, but it will also reduce costs by requiring less manpower to bring items door to door.

  • Robots Changing the Logistics Industry

This trend of using robots to do most of warehousing, unloading, loading, and even delivery will grow bigger in the near future. Amazon has, for example, purchased Kiva robots for use in their business. On the other hand, other systems reduce the physical workload for transporting items or even packing. Beyond that, more continue to be in development, with the goal of being used more widely in the logistics industry, so this is the time to see how much of the process can actually be automated.

Imagine machines communicating with each other, determining which items are low on stock and need to be replenished. Without a word or even pushing a button, companies know which items they need restock or which are not selling as much. In the future, the IoT will make it easy for logistics companies. There is also a great potential for communicating with other technologies like RFIDs (Radio Frequency Identification) or AIDC (Automatic Identification and Date Capture). Gone are the days of over- or under-ordering of goods.

  • Bluetooth Connectivity In Tracking

In the future, it will be possible to easily track all of your trucks and deliveries due to GPS technology. In fact, it might be able to enable fully automated shipping systems, from accepting the orders, preparing them, and even on the way to the consumer. Shipping errors will be almost nonexistent.

  • Tracking With The Use of Electronic Logging Devices

Because not everything can be transported by drones, there will still be a huge need for truck drivers who travel from state to state to deliver supplies. Electronic logging devices (ELD) will improve shipping time and accuracy, as well as make the streets safer by recording driving information.

The whole face of the logistics industry may change in the future, as many technological advances shift how this work is done. While the human component may be reduced, higher accuracy and shorter wait times will definitely be appreciated by the end consumer. In turn, logistics companies save money on operations and less waste produced.

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Summary
What Is The Future Of The Logistics Industry? | Trade Finance Global
Article Name
What Is The Future Of The Logistics Industry? | Trade Finance Global
Description
A look at the potential growth and automation trends in the freight and shipping industry, looking at future potential and future trends in the sector.
Trade Finance Global