Nowadays, evolving technology can dramatically change the way society functions. I can still remember my very first cell phone. The most high-tech things it could do were make phone calls and send text messages, all hand-crafted in T9 of course. Fast forward fifteen years and now my cell phone also doubles as my HD camera, portable music device, library, fitness tracker, and of course, my means to call and text. Life as we know it is constantly being shaken up, and supply chain is no different. Trends in shipping and logistics like the rising popularity of e-commerce and blockchain technology are already changing the fabric of the industry as we know it. Read on for a more in-depth look at some of the biggest trends in shipping and logistics taking place this year.
1) Shorter Shipping Windows and More Efficient Last Mile Deliveries
Let’s face it, when it comes to online shopping, we have it easy. Nearly anything that you could want or need is only a few clicks away, and retailers like Amazon have led us to become accustomed to receiving our goods in 2 days or less. One of the significant trends in shipping and logistics that will continue into coming years will be an increase in the number of and efficiency of last mile deliveries driven by the surge in e-commerce sales. According to Shirish Gupta from The Market Reports, Global Last Mile Delivery was valued at $30.2 billion in 2018, and it is projected to reach $55.2 billion by 2025. As long as online shopping remains popular, logistics providers will need to focus on their last mile delivery processes to make sure that they are as effective and inexpensive as possible.
2) More Applications of Artificial Intelligence, Automation, and Robotics
We are seeing more and more supply chains integrating artificial intelligence (A.I), automation, robotics, or some combination of the three. In some parts of the world, corporations are already using drones to deliver packages, further reducing the costs associated with last mile deliveries. Elsewhere, self-driving vehicles are already in testing mode, and chatbots in place of customer service representatives are becoming more and more commonplace.
A Harvard Business Review report states that automated processes could soon replace a majority of supply chain functions. The idea behind this revolution is that they minimize the risk of human error, thereby increasing overall productivity. Further benefits of A.I, automation, and robotics include increased visibility, lower operating costs, and higher profitability. Expect to see these automation trends in shipping and logistics continue to grow in popularity in the coming years.
3) A Greater Emphasis on Safety
People are protective over their data, and with good reason. In today’s day and age, it just takes one data breach to set everyone off in a panic. Think back to the Equifax cybersecurity attacks of 2017. According to the New York Times, it was estimated that up to 143 million people were affected, with extremely sensitive data like Social Security numbers and drivers license information leaked. The entire ordeal was on account of Equifax’s use of outdated software. Hackers were able to exploit a bug in the software and successfully execute the data breach. That said, expect to see companies take cybersecurity very seriously to avoid any similar data breaches in the future.
Blockchain, another trend that has been finding its way into logistics supply chains, protects data as blockchain, an immutable ledger technology, is virtually unable to be hacked or altered. If you are thinking of implementing blockchain, be sure to look for a public solution instead of a private one. While both offer benefits, a private blockchain makes your data visible to the owner of the private blockchain. It can be tampered with, whereas with a public blockchain, your data is actually safer due to distributed consensus and validation.
4) The Trucker Shortage will Continue, Inadvertently Increasing Less-than-Truckload (LTL) Shipping
As it stands, there aren’t enough truckers on the road to meet the growing demand. Although some retailers like Walmart are taking concrete steps to combat the shortage, the capacity crunch is expected to continue. This will lead to an increase in LTL shipping whereby multiple different shippers can share space on the same truck, paying only for their individual portions. This method of shipping is also considerably more eco-friendly, another of the many trends in shipping and logistics that we are seeing permeate just about every other industry on the planet.
5) More Companies will be Embracing New Trends in Shipping and Logistics
If history has taught us anything, it is that you need to adapt and evolve in order to keep competing, remain efficient, reduce costs, and attract new revenue models.
How to Prepare Moving Forward
With the way the industry stands, today’s hot trend could become obsolete by next month. Trends in shipping and logistics are always changing, and the most successful players will be those who are paying close attention. Keep reading, keep learning, and never get too comfortable. If you are interested in exploring the supply chain and logistics industry a bit further, be sure to check out the other articles on the ShipChain blog!