You want to track the status of a shipment, you enter the order ID or tracking ID number online and know in real-time the status of your shipment; you want to calculate shipping cost, you enter specific details and get an instant quote on shipping rates. In short, emerging technologies in logistics and supply chain management is all you need to drive efficiency in logistics operations. We’ll talk about logistics technology here and understand how concepts like e logistics, digital logistics, AI and analytics in logistics is shaping logistics and SCM operations in 2023 and beyond.

What is logistics technology?

Logistics technology refers to digital tools and emerging tech that enable logistics service providers to monitor, manage and optimise logistics operations, workflows and processes.

Logistic technology uses software and digital solutions for end-to-end logistics and supply chain management. It helps to simplify difficult logistics operations and brings efficiency in the flow of goods.

The challenges in Indian logistics are plenty, and emerging logistics technologies are helping to solve for it. From streamlining processes, to cutting expenses, and adhering to compliances (especially for running or starting an import and export business), to providing better customer experiences and reducing delivery timelines, digital logistics is touching every aspect of SCM today.

Logistics technologies are also enabling businesses to collect data and analyse it, gain insights, follow trends, grow sales and customer engagement and more.

From better management of inventory, warehouses and fulfilment centres, to facilitating secure and timely transportation to remote locations, and improving packaging, logistic technology is redefining the role of logistics in business today.

5 Emerging technologies in logistics and supply chain management

The Indian logistics industry is growing at a breakneck pace. Whether B2B or B2C or D2C logistics, eCommerce, inbound and outbound logistics, freight forwarding, dropshipping and reverse dropshipping, or any other. Investing in advanced logistics tools and software therefore is the smartest thing you can do if you want to stay competitive and deliver results.

While there are several logistics technology trends that businesses must say updated with, here we will take a look at the top 5 emerging technologies in the logistics sector that is redefining its future. Let’s begin.

1. AI led automation in warehousing and customer service

Artificial Intelligence is one technology that has impacted all industries and business functions – and logistics is no different. It has been adopted across multiple logistics and supply chain functions including inventory calculations, warehouse management, customer support service and many others.

AI-lead sub technologies – machine learning, NLP, computer vision, wearable technology etc. has redefined the need for AI in warehouses. Some of the ways AI solutions are used in warehouses are:

• Task automation: There are several routine tasks that can be automated with AI. For instance, to streamline palletised shipping operations, ML algorithms can be used to calculate stock and pallet requirements, forecast inventory requirements, optimise expenses, and manage materials handling.
• Supply chain visibility: Visibility across the supply chain is possible as AI tools and IoT sensors can capture, analyse and provide insights from real-time data. AI and ML can recognise visual patterns that makes physical inspection of goods faster and more reliable. When it comes to inventory, RFID technology and scanners can be used to organise and manage inventory, moving away from manual, paper-based documentation.

Similarly, there are several groundbreaking instances of customer support services automation in the logistics and transportation sector:

• AI Chatbots and voice assistants: Customers can have multiple queries about their packages and logistics services in general. Using AI chatbots and voice assistant applications, these conversations can be streamlined. AI software, driven by NLP and ML algorithms can be taught and fed with the required information to answers diverse queries, error-free. From queries on pricing, to packaging, timelines, cancellations, refunds and others, AI chatbots can reply correctly to queries instantly, 24×7. They can even engage customers, upsell and cross-sell services, and enhance overall customer satisfaction. Among the many ways logistics companies can improve customer services using AI chatbots is the smart way of doing so.
• Booking a shipment process: AI led automation can also enable customers to streamline the logistics booking process. For instance, AI tools can record and save customer details and auto-fill booking forms to save time. They can also calculate shipping costs, recommend shipping and packaging solutions, provide ETA on delivery timeline, send notifications on order status, payment details and more. Customers can have greater visibility on their orders, shipment and payment status, without having to check emails or follow up through calls.

2. Blockchain technology in logistics operations

A blockchain is a digital database or ledger that tracks all transactions made in real-time. It stores data in a decentralised database and can be used across industries. Blockchain data is immutable, that is, data once added to blocks cannot be changed. This makes it a secure, safe and transparent tech to use.

Quite naturally, blockchain is an emerging logistics technology that many shipping and transportation companies are adopting. So, what can blockchain do for logistics processes:

• Secures payments: Blockchain tech can record all payment transactions in real-time and reduce errors. All transactions are secure and transparent, with end-to-end details on payments made. Any anomaly on unrecognised transactions triggers alerts reducing the scope of fraud. Smart contracts and blockchain in logistics are often used to record international payments to keep it secure and track monetary details.
• Simplifies shipment tracking: Since blockchain tech records every transaction in its ledger without modifications, it brings transparency in cargo tracking. This is more for international shipments and those that are being shipped over long distances.
• Inventory management: Blockchain adds value to all the goodness AI tech is bringing to logistics and supply chain management. For instance, most businesses work with multiple vendors, suppliers and distributors. Tracking products enables businesses to manage inventory and make payments in time. Blockchain enables businesses to accurately track the status of goods, measure inventory, predict demand/track sales and recorder in time and more. Most eCommerce businesses use this technology and SKU enabled labels to track movement of goods and record them automatically.

3. Cloud logistics technology in supply chain

Cloud technology is being used across all industries and logistics is no different. Cloud computing provides logistics companies the flexibility to access, monitor and manage data remotely, without having to make large investments in infrastructure. It also allows ease of scalability, saves businesses time, and provides data in real time.

Logistics and supply chain is a complex business. Goods move round the clock and gaining access to the right information is vital for all stakeholders. Some of the benefits of cloud computing in logistics and supply chain management are:

• Higher collaboration: Between global/remote teams and with vendors, suppliers, freight companies and other stakeholders
• Demand-based scalability: For logistics companies to scale as per demand, e.g., demand based forecasting to add/remove resources and infrastructure support based on demand
• Better transparency: Between all stakeholders as user access can be controlled, monitored and denied as required

Moreover, it also enables logistics companies to save time and expenses and improve delivery timelines. For instance, GPS enabled tracking devices can provide real-time status updates for predicting delivery ETA; analytics data can help forecast standard ETA on delivery; data on weather, terrain and general updates can help plan better routes for optimisation.

4. Internet of Things (IoT) technology adoption

There are multiple ways how IoT is being used in logistics and supply chain operations.

• Security and safety: Thefts, loss or damages to goods, machinery malfunction, etc. are not uncommon in warehouses. This is more common in large warehouses that’s not manned sufficiently to keep watch 24×7. IoT solutions and connected devices have enabled logistics companies to largely resolve this challenge. For instance, CCTV cameras and apps can alert supervisors of any unauthorised access to data or entry points; IoT sensors and digital tools can detect changes in temperature or send reminders on timely machine maintenance (predictive maintenance); GPS enabled vehicles can be monitored to prevent rash driving or respond to emergencies.
• Tracking and data: It’s always a comfort to know where your goods are. An e-Commerce customer has the benefit of tracking their shipment, thanks to IoT sensors in vehicles (GPS). For businesses, it’s necessary to understand the pace at which goods are moving, within the warehouse and CFS (i.e., container freight station) and to the end-customer. This data tracked in devices can be analyses for insights which can help businesses plan purchase, understand delivery timelines and performance and reduce lead time, optimise routes, forecast demand, facilitate timely decision making, and more.

To put it briefly, IoT connected devices enable businesses to minimise human intervention and bring logistics efficiency through digital logistics technology.

5. Digital twins and innovative logistics systems

Digital Twins are the next emerging technologies in logistics and supply chain management that we are going to talk about. Put simply, digital twin technology creates a replica of an asset. It can be a product or process and uses real-time data and ML technology to study its behaviour, to predict future outcomes. Some of the ways in which digital twins impact logistics and SCM are:

• Warehouse layout design: Digital twin tech can reimagine how the warehouse can operate with a more planned and structured layout; how to optimise space and storage solutions; what technologies to use, and more.
• Supply chain planning: Digital twins in logistics can also enable businesses to plan supply chains better. In in evolving world, it’s necessary for businesses to plan ahead of time and stay prepared. Road blockage? Take an alternative route. Packaging issues? Have environmentally friendly packaging solutions ready. In brief, logistics firms have to predict, forecast and anticipate supply chain challenges and have solutions for them. Logistics technologies like digital twins enable businesses to build scenarios, plan and test, to come up with solutions that minimise disruptions across the supply chain.

Digital logistics technologies – The future in logistics

Does this mean logistics technologies will take over and replace humans? How much does it cost to implement digital and e logistics in business? Are the right skills and resources available to switch to emerging technologies in logistics and supply chain management? These are questions that are most likely to be asked. There is no definitive answer to any of them.

On the one hand, there are multi-modal logistics parks and transport nagars being set up by the government in strategic locations, and new policies being designed to lower logistics costs (e.g., PM Gati Shakti). On the other there’s fuel surcharge that leads to higher shipping rates. There are large transporters who realising the need for automation are steadily investing in AI and digital logistics technology, while there are small logistics companies who are struggling to meet break-even.

In truth, logistics technologies are here to make the process better, faster and secure. There are costs involved and greater cooperation required. It’s not going to happen overnight but considering the positive approach of logistics firms and numerous government policies, the next generation of logistics tech is not far away.

Author: Sohini Banerjee

Sohini is a seasoned content writer with 12 years’ experience in developing marketing and business content across multiple formats. At Tata nexarc, she leverages her skills in crafting curated content on the Indian MSME sector, steel procurement, and logistics. In her personal time, she enjoys reading fiction and being up-to-date on trends in digital marketing and the Indian business ecosystem.