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As someone rightly said about digital transformation, it’s not about why but the question of when. If we look at the emerging trends in the B2B logistics and distribution sector, we can comfortably say that it’s ripe for disruption. The pressure is not just from nimble startups, but also from customers and partners who themselves have faced the uber moments in their respective industries. In today’s marketplace, virtually every enterprise depends on its partner network, including distributors and logistics partners, to remain competitive.
But more often than not, the lack of Business-to-Business (B2B) integration causes hindrances for businesses to evolve into digitally mature organisations. Modern technologies such as Artificial Intelligence (AI), Blockchain and the Internet of Things (IoT) offer ample opportunities for the logistics industry to transform itself digitally.
The Digital Transformation Spending in Logistics Market report compiled by Transparency Market Research anticipates that the spending on digital transformation in logistics will grow to over $94 billion by 2026 at a CAGR of 10.7% during the projected period of 2018-2026. 4 Key Digital Technology Trends in Logistics In the post-COVID-19 world, B2B logistics companies are under immense pressure to deliver improved services, influenced by more factors than ever. We believe the following digital trends will have a significant impact on the B2B logistics and distribution world.
1. e-AWB The B2B logistics industry is fast shifting to the electronic Air Waybill (e-AWB) from the traditional paper Air Waybill, which traces the cargo from the shipper to destination. Paperless e-AWB has become the new norm to efficiently tracking and processing cargo data along with increased transparency and a significant reduction in costs and unnecessary delays. Earlier this year, the International Air Transportation Association (IATA) declared the e-AWB as the default contract for carriage. Major international airlines, including Lufthansa and Emirates, have already implemented it, with Delta Airlines and United Airlines to follow suit. The International Air Cargo Association has set a visionary goal of 100% e-AWB adoption by 2022.
2. AI and Machine Learning There is a vast potential for the implementation of AI and machine learning in logistics as the technologies can help analyse and harness the virtual goldmine of unstructured and structured data for higher business outcomes in the supply chain. Machine learning algorithms can help logistics businesses uncover hidden patterns in the supply chain data to pinpoint the factors influencing their supply chain network’s success. The insights can help logistics players decipher details on inventory levels, suppliers, forecasting demand, production planning, transportation management, and scale back freight costs.
3. Internet of Things (IoT) IoT is fast proving to be a game-changer in the logistics domain. IoT-driven sensors can help logistics operators to monitor humidity and temperature of perishable and sensitive cargo products such as food and pharmaceuticals. Near Field Communication (NFC) tags provide product authentication to help keep counterfeiting and theft in check. IoT can help improve location management and streamlining business processes. An IoT-enabled smart location management system helps logistics operators to track drivers and vehicles easily along with delivery status. Other applications of IoT include inventory tracking, warehouse management, predictive analytics, supply chain management, self-driving vehicles, and drone-based delivery.
4. Blockchain The blockchain technology offers end-to-end solutions for logistics operators to run lean and efficient operations. A decentralised public ledger helps record the movement of each shipping container in real-time. Driven by the generated data, logistics players can eliminate unnecessary steps in the delivery process and implement faster routes. Blockchain can also help reduce bottlenecks and eliminate clerical errors. Smart ledger-based contracts enable logistics companies to increase transparency while reducing the delivery time.
Thanks to transparent recordings, reduced costs, and efficient route information, the logistics domain is primed for a technological upgrade. Cracking the Digital Growth Code in B2B Logistics. These four promising digital technologies can help logistics companies operating in the B2B domain to crack the digital growth code and create value from digitisation.Digital technology innovations can help logistics companies to modernise their core business operations and improve supply chain efficiency along with increased ROI. However, it is crucial to evaluate the value and efficiency of each implemented technology with the help of clear metrics.