Logistics industry alone was $8.1 trillion in 2017, and was well paced to double by 2023. For a market that size, even small technology implications are colossal.
To be honest, technology is no stranger to the logistics industry and juggernauts such as Amazon have already given us a peek into the future.
Consider the 2019 Gartner’s CEO and Senior Executives Survey which revealed that a whopping 87% of respondents expected changes in their business model in 2021; come 2021, we have to magnify the response and expect some major business model changes.
Top Logistics and Supply Chain Trends to follow in 2021
A sea of change has been triggered by 6 forces acting collectively:
- Customer expectations
- Technological advancements
- Technological affordability
- Pandemic triggered constraints
- Global recession
- Trade wars
Most of these forces have proved to be sticky and will very well change the underpinnings of the industry.
2021 and the Inflection Point of Logistics and Supply Chain Industry
Now, as noted by McKinsey& Company, digital ecosystems could represent $60 trillion in global revenue by 2025.
Top 10 Logistics and Supply Chain trends to watch out for in 2021
- Foray of Digital Masters
- The Last Mile Delivery Startups:
- Pandemic-Proof Supply Chain
- Sustainable Logistics
- Blockchain-Enabled Digital Ecosystems
- Logistics As A Service (LaaS)
- Computing Is Pushed To The Edge
- Digital Twins Of Everything
- AI Driving Logistics
- Predictive Logistics Insights
- Foray of Digital Masters : Like other industries there is no getting away from the digital giants. Amazon and Alibaba, for instance, are building a global logistics network. With parcel volume around 6.5 billion packages (2022 )for Amazon Logistics, FedEx, UPS and USPS are set to lose a lot of business.
- The Last Mile Delivery Startups: Expect a lot of innovation as $11.1 billion was pumped into startups offering last mile delivery. services to retailers and individuals.
- Shock-proof Supply Chains: The deep impact of the pandemic has shaped the future of logistics and supply chains as companies now work to establish systems that can handle challenges on the fronts of labor, asset tracking, and security, cost and productivity issues.
- Sustainable Logistics : Carbon footprints, noise and waste are more significant than before and global logistics companies are putting more focus on industry’s environmental responsibilities. In short, if it is not sustainable, it will not sustain. Use of recyclable IT hardware is a good starting point.
- Logistics Digital Ecosystems Powered by Blockchain : It seems to be a logical solution for an industry ailing with issues such as lack of transparency, auditability, tracking as well as peer-to-peer data interoperability, fraud detection, and contract management to create new ecosystems that solve the above issues to a large extent. Blockchain in Transport Alliance (BiTA) is an exemplary effort that enables logistics juggernauts FedEx, UPS, and Uber Freight to create standards, approaches and even solutions to maximize the benefits of blockchain ledger technologies. This seems to be a perfect beginning for more standardization to come.
- Logistics As A Service (LaaS) : As in other industries, logistics-tech companies are beginning to disrupt. Perfect example is the company – Just-in-time, and BluJay Solutions are LaaS providers that allow organizations to have cutting-edge logistics capabilities very quickly vis-a-vis building them in-house. This shift to LaaS can be attributed to the need for better customer experience, and cost as well as tech expertise involved.
- Edging towards Edge Computing : Today supply chains have been empowered by the army of Internet of Things devices that are creating unprecedented data and required to make real-time decisions with almost no latency. Edge computing is thus the only solution.
- The Logistic Digital Twins : When it comes to seeing the physical world at an intimate level, its digital twin is the only way as it delivers new insights, simulations and real-time tracking and captures the relevant data across the supply chain through IoT sensors and other technologies to be represented in virtual or simulation environments.
- AI Behind Major Logistic Leaps : Drones, virtual assistants, self-driving vehicles and warehouse management are all powered by AI. It is set to change everything. As IDC puts it through its survey, around 25% of G2000 companies are planning to embed one AI/intelligence capability into its offerings. They plan to acquire one AI software start-up for coping up with differentiated skills and IP.”
- Predictive Logistics Insights : With 93% of shippers and 98% of third-party logistics firms feeling like data-driven decision-making is crucial to supply chain activities and 63% of the largest and most impactful logistics organizations saying investment in predictive analytics is optimal to organize newly digitized fleets, it’s easy to say that data is the competitive differentiator.
As a leader in the logistics and supply chain industry, you have a fiduciary responsibility to act on these trends. The innovative trends in this article will only continue to grow, and as they do, it will be up to you to disrupt or be disrupted.