Logistics
18/8/2021

3 reasons why the digital logistics of the future should be all about transparency

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The logistics sector is one of the largest industries in the world. The transformation of this huge industry holds many risks, but also many opportunities for those who switch to modern technologies early enough.  

After more than 500 expert interviews across the entire industry, in this blog post we want to elaborate on why transparency is probably the most important factor for the digital logistics of the future.

How digital is the logistics industry?

After the automotive industry and retail, logistics is Germany's third-largest economic driver. With around 268 billion euros in sales last year, Germany occupies an important position on the international logistics market. This is mainly due to the high quality of its infrastructures and the use of logistics technologies.  

Source: BVL

Among the approximately 60,000 mainly medium-sized companies in Germany, however, digitization has not yet found its way everywhere. As a result, these "latecomers" are limited in their room for maneuver, especially in crisis situations.

In the general public, the logistics sector is usually considered a laggard when it comes to digitalisation, even though it is Germany's third-largest economic sector. And in fact, the insistence on old and above all manual process structures is slowing down logisticians all over the world.  

Are logistics and digitization mutually exclusive?

In the 1970s, freight forwarders were relatively early to use computers to calculate routes, until barcode scanners were also used in the 1980s to record shipment and SKU data more quickly. Logistics is therefore definitely a driver of digital innovations.

In the age of Industry 4.0, customer demands on logistics have risen particularly rapidly: Not only should delivery be ever faster and preferably on the same or next day, but more sophisticated production logistics with their interconnected processes and interfaces are also required to keep customers happy and loyal to your brand in the long term. While Excel solutions were enough to achieve this a few decades ago, logistics today demands digital processes and more transparency along the entire supply chain so that empty spaces and disappearing deliveries will soon be a thing of the past.

How digital can work in the warehouse or in the cab be?

Of course, there's more to the warehouse than just transporting pallets from A to B. For example, did you know that some warehouse and fulfillment facilities even use drones or cutting-edge film technologies to take inventory? Self-driving forklifts and intelligent sorting robots are also already available to relieve warehouse workers of physically demanding work. So, a job in warehouse logistics is much more digitalized than might be imagined at first glance. Digitalization is also not neglected for employees in inland shipping, supply chain planning and risk analysis in logistics. Enormous amounts of data are collected to make supply chains visible and to be able to make adjustments flexibly. With wearables, tablets & co., the work of logistics experts is made easier.

However, since digitalization has not yet found its way into all areas along the supply chain, many warehouse employees cannot yet reliably access the most important data. Only if the entire flow of goods is recorded and displayed digitally and transparently can the data be used effectively in risk management and to optimize warehouse processes. Therefore, the supply chain management of the future demands more accurate data collection, easy collaboration and transparency.

3 reasons for more digital logistics

  1. Better capacity utilization in road freight transport:

Seasonal, but especially short-term fluctuations pose numerous challenges for the transport and logistics industry. For example, the Fraunhofer Working Group for Supply Chain Services SCS is also working together with the University of Regensburg on the KIVAS project, which involves AI-supported short-term forecasts. This should massively relieve German road freight traffic and also make it more sustainable. Reliable tracking & tracing are guarantors of smoother operations at loading and unloading points.

  1. Risk management is made easier:

By identifying risks in good time - with the help of real-time data - companies can determine order quantities or their choice of suppliers at an early stage and thus avoid supply bottlenecks. In the Corona crisis, for example, despite closed internal borders in Europe and tightened border controls, transport routes could also be adjusted at short notice to bridge longer waiting times.

  1. Networking of the individual players:

As logistics companies ship goods to their destinations faster and faster, this also means that production companies, freight forwarders, transport service providers, shipping companies, customs authorities, etc. must also act more quickly. A common problem here is that contracts and transport documents are mostly still in circulation in printed form. This slows down transit time and always keeps management costs for logistics services high. Collaboration in the cloud connects all players on one level and eliminates misunderstandings and missing documents.


Conclusion

B2B markets today face many threats, but also demand many changes. The intervals in which logistics requirements change are becoming shorter and shorter. In addition, the current Corona crisis has exacerbated previous supply chain issues and underscored how well-functioning supply chains keep the economy flowing. As a result, there is a growing desire for greater transparency, data sharing and cross-company processes.  

In this context, the topic of supply coordination holds great potential for efficiency. The problems caused by a lack of information, poor communication and inefficient processes can be found across all industries and are more relevant than ever in the 21st century - the need for optimization is high. After all, there is an enormous amount of coordination behind on-time delivery to production and on-time delivery to customers.    

In our eyes, there is enormous potential in the effective cooperation of all collaborators in operational logistics. This is based on the fact that the goal of every company is the same: to deliver their desired product to the end customers as quickly as possible - in the best possible quality. With TradeLink, you can already bring your farm processes up to date digitally and invite all your partners to collaborate. Want to learn more about your possibilities with TradeLink? Book your personal demo now and let one of our logistics experts guide you through the tool!

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