The global logistics market was valued at USD 7,641.20 billion in the year 2017. This is further expected to hit USD 12975.64 by 2027.
The logistics industry is huge, and it is evolving at a rapid pace. New technologies are making logistics more efficient than ever before, resulting in new opportunities for businesses to grow their international operations. It’s exciting to see how technology is transforming the way we conduct business.
But how will these trends impact the future of logistics? If you’re looking for ways to stay on top of this growing industry, this article will give you some insight into what you can expect from tomorrow’s supply chains and distribution networks.
Multimodal Network Optimization
Multimodal network optimization is the use of algorithms to optimize the way freight is moved. The goal is to reduce the number of trucks on the road, which saves money and reduces pollution. Established eCommerce giants like Amazon are experimenting with multimodal network optimization.
For instance, a leading logistics company developed this system for using trains or ships when they were too busy sending goods by truck. This allows them to cut down on costs since trains and ships are significantly cheaper than hiring additional drivers.
Automation and Robots
The use of automation and robots has been gaining traction in logistics as a way to minimize human error and increase efficiency. The technology is being used by companies to sort, pack and deliver orders, transport goods, scan products for quality, and track inventory. Market research projects that the global robotics market will hit USD 30.8 billion by 2027.
Automation will help improve the supply chain process by reducing costs, improving accuracy, and making it easier to scale quickly. Companies that want to compete in today’s fast-paced market need to find ways of automating their processes so they can operate at scale without sacrificing quality or customer service.
Rise of 3PL Service Providers
In the future, 3PL logistics service providers will be more important than ever. As e-commerce grows, these third-party logistics companies will create new business models and compete with each other to provide the best services at lower costs.
This is especially true in an increasingly global world where consumers expect fast delivery times. In fact, according to a recent study by the IBIS World, around 20,406 3PL businesses are registered in the US in the year 2022.
Imagine being able to order online from any retailer in Europe or Asia and having your package arrive at your door within 24 hours. That’s exactly what Amazon has done with its “Prime Now” service offering free two-hour delivery on select items from its warehouses within 30 minutes from thousands of cities around the world.
And Walmart is doing something similar with its own version called “ShippingPass” which offers free shipping for orders over $35 after signing up for a monthly subscription plan.
These trends are changing how we think about fulfillment capacity as well. You may need fewer warehouses if you’re using third-party logistics instead because there’s no need for them anymore since all packages are delivered directly from wherever they were manufactured, stored, and packaged.
Blockchain – Secure and Transparent Transactions
Blockchain is a digital ledger that records transactions. It’s been around for a few years, but it’s only now gaining mainstream acceptance as people begin to realize its potential as an efficient and secure method of recording data.
Blockchain technology allows information to be shared between parties without using an intermediary, which reduces costs, improves security, and expedites the exchange of goods and services.
Because the data stored on a blockchain can be viewed by all parties at any time, it is also considered transparent. This feature could have implications for supply chain management in particular. By using blockchain technology, companies can ensure they are dealing with reputable suppliers while gaining visibility into their entire supply chain process at every step along the way. As such, it may help reduce instances of fraud or theft by providing proof that all products were produced according to agreed-upon standards or specifications.
Urbanization and Mobility
Urbanization is one of the most important trends in logistics. It’s also a global trend, which means that urbanization will soon become one of your most important areas of focus.
That has many significant implications for businesses seeking to grow their sales volumes and reach new markets, including the need for companies to rethink how they deliver products and services to consumers in those urban centers.
Urbanization creates new opportunities for logistics providers because it leads not only to more demand for logistics services but also changes in how those services are provided.
This growth also means that companies looking at setting up shops within these areas need reliable ways of getting their goods from place A, where they’re manufactured, all the way through transportation networks until they arrive safely at place B, their destination.
Data Analysis With AI
Artificial Intelligence is a key technology that will transform logistics. It can be used to optimize operations, reduce costs and provide better customer service.
AI can be used to predict demand and supply, whether by analyzing past trends or using weather data to predict what products will sell the most in a given region at a certain time of year.
By analyzing data from sensors on trucks and containers, AI can also help improve routing and scheduling so that more items are delivered in the best way possible. Moreover, it can optimize fleet management so that truckers have access to real-time information about loading times at warehouses along their route.
The future of logistics is bright, and it’s full of opportunity. The arrival of new technologies and business models will continue to transform this industry and create new opportunities for companies that embrace these changes.