The Global Logistics Landscape in 2018

The most successful shipping and logistics professionals of 2018 will be those who leverage emerging technologies to create unique benefits for their business.

The most successful shipping and logistics professionals of 2018 will be those who leverage emerging technologies to create unique benefits for their business.

In 2017, the shipping and logistics industry witnessed an increasing expansion of e-commerce, the adoption of emerging technologies, and, despite a robust global economy, soaring operating costs. Taken together, these trends point to a logistics landscape in 2018 that will reward professionals who know how to maximize the potential of recent shipping technologies while minimizing their negative effects.

For example, the dominance of e-commerce has driven growth for online businesses, but it’s created a market in which consumers expect free shipping and constant updates as a given. In order to satisfy customer demands and enjoy rising profits, shippers must increase spending on quality logistics solutions.

This isn’t the only double-edged sword that professionals will see throughout the shipping and logistics industry in the upcoming year. To prepare your company for these disruptions — and the opportunities that come with them — we’ll tell you what you need to know about 2018’s emerging logistics landscape.

Evolving with E-Commerce

Online shoppers spent more than $450 billion on e-commerce outlets in 2017, a 16% increase from the previous year. While this growth is a boon for the global economy, it will certainly increase the strain on logistics infrastructure in 2018.

In order to prepare for this surge in volume, supply chain managers are focused on evolving alongside e-retail sales. For many logistics providers, this entails substantial investment in improved warehousing facilities. Rather than construct sprawling distribution hubs responsible for serving entire regions, it’s becoming increasingly common to focus on more compact, strategically located fulfillment centers. Whereas the larger facilities of the past several decades were well-suited for centralized brick-and-mortar retail distribution, these smaller fulfillment hubs — dispersed throughout major geographic regions — will best position businesses to maximize last-mile performance.

Managing Technological Experimentation

Any seasoned supply chain manager can tell you how many “game-changing” technologies they’ve seen come and go throughout the industry. With the increasing sophistication of Internet of Things (IoT) technologies and artificial intelligence (AI), the pace of innovation is only going to quicken. Since shipping and logistics operations come in all shapes and sizes, every emerging technology isn’t going to work the same for every business that integrates it into their supply chain. Rather than cram a round peg into a square hole, savvy companies should become familiar with the precept “fail fast.”

Radio-frequency identification (RFID) tags, for instance, have been hailed as the next big thing in the industry. Powered by IoT-enabled networks, RFID tags can illuminate an entire supply chain for managers and customers alike. While they may change the way large businesses manage their supply chains and monitor flashpoints, their high cost and maintenance requirements may render them impractical for small- and medium-sized businesses. In the fast-paced world of modern shipping and logistics, this isn’t a catastrophic failure — so long as operations move quickly to contain the damage and continue innovating.

Embracing Automation and Robotic Support

If they play their cards right, smaller businesses with a proactive mindset and strategic point of view can thrive in 2018, especially when it comes to automation and robotics. Lower barriers to implementation will mean that companies can introduce this technology at the scale that works for them. By boosting storage density and cutting down on labor costs, advanced robotics, automated storage and retrieval systems, and autonomous vehicles within warehouses can give companies the bandwidth to focus on big-picture strategy.

Bringing Ride Sharing and Crowdsourcing to Freight

In 2017, Uber launched a freight version of its popular ride-sharing app called, appropriately, Uber Freight. The service matches shipments with available trucking capacity, on top of streamlining rate negotiations and payments. While this model isn’t without its shortcomings, it may increase overall freight utilization while lowering costs. Similarly, last-mile fulfillment is finding an unlikely ally in crowdsourcing. With services such as Hitch, commuters, drivers, and part-time workers can retrieve shipments and deliver them to their final destination.

For companies struggling to meet customer expectations, these options may help them pick up the slack, though they likely haven’t matured to the point where they can become primary service providers for order fulfillment.

Partnering with 3PLs and ISPs to Get the Job Done

While the global logistics landscape of 2018 looks daunting — and expensive — the right business partners can make it surprisingly navigable. With more than two decades of experience in the shipping and logistics industry, Primary Freight has the infrastructure and personnel to meet any developing logistical challenge. Our team has the resources to leverage emerging technologies with the institutional knowledge to distinguish fads from actionable opportunities. If you’re looking for a partner who’s as interested in your business’s strategic growth as you are, Primary Freight is ready to help.

If you’d like to learn more about how Primary Freight’s warehousing and distribution solutions, contact us today at (800)-635-0013.


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