Disruptive technologies are reshaping the logistics industry

How has the supply chain and logistics industry responded to pandemic-related challenges?
The effect of the global pandemic led to the formation of a digitally connected marketplace where the consumer sat at the top of the supply chain. Stay-at-home orders and health issues have pushed people, even those shunning the virtual world, into online shopping channels.

This has driven retailers, e-commerce providers, logistics service providers, and on-demand delivery providers to deliver rapid innovation, especially when it comes to last-mile fulfillment. To solve this problem, companies have adopted smart logistics management tools to help them scale, ensure availability, provide pleasant and safe deliveries, speed up fulfillment operations, optimize costs and even identify new sources of revenue. .

Specifically, disruptive technologies such as artificial intelligence (AI), machine learning, automation, big data and predictive analytics and the Internet of Things have become essential for logistics-focused businesses to building resilience and navigating the ‘new normal’.

A critical development that occurred during the initial phase of the pandemic was the need to bring inventory closer to customers. Soon, businesses began converting less-frequented brick-and-mortar stores into dark stores. It has emerged as a vital aspect of on-demand deliveries. But it has again triggered the need to revisit service level agreements (SLAs) and rethink how to leverage logistics service providers to meet business goals and customer expectations.

Why has fast commerce become the key to e-commerce?
The emergence of the fast trade (or q trade) industry takes customer expectations to a whole new level. While consumers initially demanded that groceries, food and medicine be delivered in less than 45 minutes, expectations are now shifting towards retail and e-commerce. Therefore, e-commerce and retailers will have to rethink the way they execute delivery operations.

Businesses will urgently need to ensure high levels of transparency to customers, make driver management processes highly efficient and intelligent, and improve real-time customer communications. Other areas they will need to focus on are reconciling customer inventory by balancing physical stores and dark stores, real-time inventory visibility, and improving the management of logistics service providers to meet SLAs. strict.

How AI and automation support the logistics industry?
Intelligent logistics management platforms based on AI and automation enable companies to optimize delivery costs, improve resource utilization, ensure timely delivery and
precise decision-making and rapid scalability. AI-powered route planning tools can consider multiple factors while seeking the most efficient
and a cost-effective delivery route, which is otherwise difficult for a human brain to analyze.

These factors include cost, fuel consumption, third party logistics (3PL), performance, order volumes, delivery model and types, store proximity and more. This significantly reduces operational costs and increases profitability per order.

With an intelligent logistics management platform, companies can reduce last-mile delivery costs by 14% and increase deliveries per driver by more than 13%. Additionally, these disruptive technologies enable companies and logistics service providers to further optimize costs and increase delivery productivity by intelligently planning routes to ensure multiple pick-ups and deliveries.

Businesses can significantly reduce their investment in tedious and repetitive manual efforts by leveraging automation. It can allow them to automate basic delivery operations such as job assignment, scheduling, roster management, driver payments, compliance, 3PL screening and more. Beyond cost, automation enables logistics-focused companies to deliver efficiency at scale.

Logistics management tools based on artificial intelligence and automation can reduce the number of man-hours spent on shipping processing processes by 56%. It reduces the time invested in manual ERP data entry processes by 65% ​​and guarantees a 77% reduction in the steps required to perform shipping operations.

Customer experience is another critical area influenced by automation. By automating delivery operations, brands can automatically send real-time notifications and alerts to customers about delivery progress and delays, if any. This fulfills a customer’s need for instant gratification and provides transparency in delivery. Advanced delivery management tools can improve customer experience by over 28%. Additionally, delivery flexibility is key to increasing customer satisfaction. Brands will leverage technology to allow customers to change delivery location or time to suit their needs on the fly.

Returns are increasingly becoming a competitive selling point for companies. According to Doodle, 68% of consumers expect free returns. Much like ensuring cost-effective last-mile operations, companies will need to adopt advanced logistics management tools to reduce investments in returns management.

Tell us about green logistics and deliveries.
Faster order fulfillment is bound to impact trip volumes. As we move forward, brands need to take advantage of tools that minimize the carbon footprint, especially now that environmentalism is rapidly becoming mainstream and carbon emissions regulations are becoming stricter. According to a study conducted by IBM, 57% of customers are willing to change their buying habits to reduce their carbon footprint. According to a PwC report, up to 65% of consumers in the Middle East have become more eco-friendly during the pandemic.

So it won’t be surprising to see customers buying sustainability-focused brands. To reduce carbon footprint and build sustainable supply chain operations, companies need to adopt smart logistics management tools. Such tools can help companies achieve their sustainability goals by reducing miles driven, increasing first-attempt deliveries, eliminating empty miles, decreasing trip volumes, improving resource utilization and limiting paper consumption.

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