The winds of change are constantly blowing, but now, more than ever, logistics and supply chain professionals are seeing it more than most.
In order to keep pace with change, it’s important to keep an eye on the supply chain and logistics trends that are happening right now. In fact, they are likely to be indicators of what’s to come in the near future.
To that end, here are 10 Supply Chain and Logistics Trends to Watch:
Expansion of Same-Day Delivery
Same-day delivery was once something that was unheard of. Today, it is becoming more than just an “add-on,” it’s now expected. Players like Amazon, ever the leader in supply chain efficiency, offer lightening fast delivery for Prime members. The empowered consumers of today are beginning to expect this option for all of their purchases.
Amazon Will Continue to Expand on “Operation Dragon Boat”
Earlier this year, we wrote about Amazon’s secret plan, dubbed “Operation Dragon Boat,” which outlined their goal of becoming a full fledged shipping company. The assumption by many is that they were planning on going head to head with incumbents such as UPS and FedEx.
Though Amazon denies it, we are certain to see them begin to own more and more of their own supply chain – including the last mile.
eCommerce Will Forever Change Logistics and Supply Chains
eCommerce has turned traditional logistics and supply chain models on their heads. eCommerce, coming from something that most people didn’t have much faith in (see pets.com), has now become the major driving force in retail today. In fact, while brick and mortar retail remains stagnant, eCommerce continues to rise.
eCommerce puts a strain on traditional models because of its nature – automated, high volume, requirements of stocking items based on demand, and a variety of delivery options. In order to meet those needs, logistics and supply chain professionals, as well as their 3PL partners, will need to look to innovation as a way to deal with eCommerce’s rising role in retail.
Logistics Innovation Will be Driven by Visibility
A general theme of all of all these supply chain and logistics trends is innovation. Innovation is the reason that economies thrive, or fail. It is the reason that a business excels, or loses out to newer entrants, and visibility is going to be the major driver of innovation for logistics.
So what does visibility mean and how will we see innovation around it?
Firstly, visibility means having a full view over your entire supply chain, from when an order is placed until it is delivered and signed for. This means a centralized system, a dispatching solution, a connected mobile app for drivers that keeps them in contact with both home base and the end-customer.
Visibility also means that the end-customer must have full view over the last mile of the supply chain. They want to know when a package is on its way, have the ability to track the movement of the driver on a real-time map through their mobile phones, as well as the ability to rate their experience after.
Engagement and Efficiency is Where Competitive Advantage Will be Created
Amazon, with its highly optimized supply chain and fast delivery times, and Uber, with its amazing customer experience have both created a paradigm shift that has had a lasting impact on consumers.
Some might see this as a threat, but you have to look at the opportunity in everything – finally, there is white space in which you can fill the void and create an advantage in a space that has been working on a similar play book for quite some time.
Supply Chains Will Need to Become Customer Centric
The paradigm shift caused by the age of empowered consumers has forced supply chains to reinvent themselves. In order to appeal to new customer expectations, formerly “Back Office” activities need to come to the front office, while some non-sales activities go further up the supply chain.
Customer Centric Supply Chains will become the norm for retailers, 3PLs, restaurants and others.
Brexit and it’s Affects on Logistics
When the surprise result of the Brexit vote came in, markets all over the world went in to a panic, with the British Pound dropping to 30 year lows after the vote came in. While it took some time, it does seem that the markets have accepted Brexit and things are somewhat back to normal. However, there is still a lot of unknowns about how Brexit will affect Britain, Europe, and the shipping industry.
If Brexit truly happens (it still requires a parliamentary vote), it’s possible that importing and exporting to and from the UK will be different. It also might lead to greater trading with China, as the free trade that was granted to European countries may no longer exist.
Time will tell, but it’s certain that the shipping industry worldwide, and particularly in the UK and Europe, will change in the near future.
Drone Deliveries: Slow to Roll Out, But They are Coming
When Amazon first announced they would be rolling out drone deliveries, the whole world was talking about it. Though it hasn’t been in the news much as of late, there are other retailers that are also dipping their toes into drone deliveries. However, no company has actually started doing them on any sort of regular basis.
Issues such as regulation have hampered their roll out. Will we see drone deliveries in the near future? Definitely. Will it be next week, next month or even maybe next year? I don’t know about that.
Postal and Parcel Delivery Companies Retain Their Positions By Reinventing Their Supply Chains
With new competition, customer expectations, and an ever faster pace of change, parcel and postal companies need to reinvent their supply chains in order to stay in the game.
A big part of this will be implementing technology that will allow for inputting orders into a central system, route optimization and task assignment, and customer engagement. With these and other functionalities in place, parcel and postal companies will be well positioned for the future.
Technology Will Be Required to Compete
The technological landscape for logistics and supply chains are changing, rapidly. In order to keep pace, processes will need to be automated, systems will need to be integrated, workers will need to have new resources, and managers will need to have better visibility. All of this requires investment into a platform that can do all of the above.
When researching such a system, think about the needs of each key decision maker in the company, as well as what can provide the end-customer with the best possible experience.