By Bek Burkhan, HaulerHub CEO
It’s no surprise that COVID-19 has changed every industry and its processes, but when you look at the supply chain specifically, its impact is extremely important. Starting with the initial shock the supply chain had at the start of the pandemic, the logistics industry was forced to grapple with concerns about cybersecurity, political regulations and, most recently, the proper distribution of the vaccine. Despite these challenges, the pandemic has highlighted a problem, the supply chain industry has had technical disruptions for years, and the time has finally come.
In the face of advancing globalization and the increasing complexity of the US economy, there is an urgent need to introduce technologies across the logistics sector. While the industry has adopted the technology more slowly than others, that doesn’t mean that implementation of the technology is not in sight. On the contrary, the solutions are already there. To transform the industry, the right investments must be made and changes in three key areas must be considered: data automation, intelligent logistics platforms, and autonomous vehicles and drones.
Data automation transparency
The traditional freight logistics model is broken. This model, known as the Third Party Logistics or “3PL” model, is the source of tedious paperwork and bureaucracy that further delays shipping and wastes resources. This is where data automation comes in.
Advances in data collection help streamline everything from planning the best routes to efficiently and sustainably planning drivers and trucks. Additionally, integrating AI and machine learning will dramatically increase transparency across the industry, increase transparency throughout the shipping process, and capture real-time, shareable data that will lead to more informed decisions and better revenue.
ON Report from Deloitte Insights finds that 50% of large, integrated companies are already digitizing the value chain and looking for new data sources to gain insights. However, this does not apply to small players. As the supply chain becomes more global and complex, investing in data automation will be an important step for all decision makers in the supply chain.
Use of intelligent logistics platforms
Data is also helping to drive the advance towards intelligent logistics platforms. Before intelligent logistics, shippers were and still are heavily dependent on 3PL companies, which charge exorbitant brokerage fees and complicate the process by closing direct lines of communication between shippers and carriers. Intelligent logistics platforms combine traffic management structuring and traffic navigation for optimal use of the traffic system and logistics management through effective use of data.
In addition to more transparency, shipping is now more flexible. Booking freight no longer has to compete with a company’s bottom line. By removing the intermediary, companies save themselves from excessive brokerage fees while streamlining the supply chain to better connect shippers and carriers.
The rise of intelligent logistics platforms will certainly also have a drastic effect on the existing performance dynamics in the logistics sector. These platforms redistribute power by providing greater opportunities for the agile small businesses and independent drivers that fuel our economy. Smart logistics platforms have inherently eliminated the paperwork and can offer better prices and fees that are much lower than the traditional model of freight logistics. The process is incredibly efficient and sustainable and a good example of the future of shipping.
What’s next? Driverless vehicles and drones
The continued research into drones and autonomous vehicles is perhaps the most obvious example of the potential for engineering disruption in shipping. Companies like Amazon, Aurora and TuSimple are already using drones and autonomous vehicles for good reason. Businesses want to get goods to their customers as quickly as possible, and while trucking has long been the preferred method to achieve this, they have been unable to keep up with increasing demand, especially with the surge in online shopping during the pandemic . With faster and technology-driven shipping solutions like drones, these companies are achieving new levels of productivity and increasing customer satisfaction.
Companies using these alternative solutions not only build brand loyalty with consumers, but ultimately lower rising labor costs as well.
Technical glitches may sometimes be feared by some, but are necessary to meet the changing needs of today’s customers. Without the technical implementation in the supply chain, we would not see the positive disruption that has always supported the growth of the shipping and logistics industries, and progress would stall.
The views and opinions expressed are those of the author and do not necessarily reflect those of Nasdaq, Inc.