Top 10 Supply Chain and Logistics Trends to Watch in 2016.. And Beyond
The winds of change are always blowing, but now, more than ever, logistics and supply chain professionals see it more than most. 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 soon.
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.
We have already seen Amazon move in that direction with their purchase of Colis Prive, rumors of acquiring an airport in Germany, buying up a fleet of 747s and more.
Though Amazon denies it, we are confident to see them begin to own more and more of their supply chain – including the last mile.
eCommerce Will Forever Change Supply Chain and Logistics
eCommerce has turned traditional supply chain and logistics models on their heads. eCommerce, coming from something that most people didn’t have much faith in (see pets.com), has now become the dominant 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. To meet those needs, supply chain and logistics 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.
Visibility Will Drive Logistics Innovation
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 primary 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 a 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 capacity to rate their experience after.
Engagement and Efficiency are 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 an area that has been working on a similar playbook for quite some time.
Engagement of end-customers and efficiency of the supply chain will be the most important factors for establishing a competitive advantage in a market that is getting even more competitive.
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. 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 its Affects on Logistics
When the surprise result of the Brexit vote came in, markets all over the world went into 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 indeed 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, other retailers are also dipping their toes into drone deliveries. However, no company has started doing them on any regular basis.
Issues such as regulation have hampered their roll out. Will we see drone deliveries shortly? 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 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. 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.
Download the Guide to Creating a Customer Centric Supply Chain White Paper by clicking the image below or here.
About The Author : Raanan Cohen
Raanan founded Bringg in 2013 with the vision of changing the way businesses deliver in the on-demand era. Raanan is a seasoned entrepreneur. He was the Founder & CEO of MobileMax, leading the company from concept to multimillion-dollar international sales and IPO. With Bringg, Raanan is one of the industry's foremost speakers and bloggers, a respected authority on logistics and supply chain market trends and disruptions, speaking in conferences and forums around the globe . Raanan is a happily married father of twin girls and two boys. As an avid sports addict, Raanan has completed numerous marathons and triathlons including ironman & ultra-marathon distances.