The freight industry is undergoing a fast-and-furious transformation. Developments in the industry point to an industry that is continually evolving. At the back of these developments are a push towards automation, SaaS, and machine-driven processes that seek to enhance supply chain efficiency while at the same time keeping costs down.
Recent logistics trends point to a future governed by efficiency and automation in the freight industry. As more tasks and processes are automated, the quality of supply chain logistics services will improve. Besides, machine-driven processes are expected to enhance trucking logistics into the future. Dropshipping and direct-to-consumer shipments will increase as suppliers seek to engage directly with consumers and lower costs.
The freight industry is one of those areas that is undergoing significant transformation. Below are eight logistics trends that are redefining how freight works:
Trend #1: Automation
Companies facing capacity constraints and labour shortages are heavily investing in automation and technology. Some of these technologies include artificial intelligence, load matching, robotics, APIs, machine learning, and self-drive vehicles.
One of the freight industry trends is that the industry will continue to rely heavily on automation. These emerging technologies will provide an efficient service that anticipates and addresses customer demands.
Trend #2: Supply chain will become more circular
Although relatively new, the circular supply chain is being used alongside the traditional linear supply chain. Rather than rely only on purchasing products from suppliers and new raw materials, the modern supply chain is focusing on recycling used raw materials.
As a result, prices are kept competitively low. What this means is that shippers will have to adopt new risk management tactics to remain profitable within the chain. This could possibly necessitate an extensive freight audit to determine the financial prospects in each stage of your supply chain. A professional freight audit company can examine your processes and give you insights on how to make the circular supply chain financially viable.
Trend #3: Rapid global growth
India, Mexico and China are driving the need for an effective logistics solution in their countries. To provide a faster, reliable and efficient trucking logistics service, distributors and manufacturers are choosing inventories that are close to consumers.
Trend #4: Freight forwarding
As faster service requirements fuel the need for an effective international freight forwarding service, we are likely to see the logistics trends steer towards ocean-to-air shipments. These logistics trends will affect trucking logistics as carriers add larger and newer ships to increase shipment capacity and provide lower rates.
Trend #5: Direct-to-consumer shipments will increase
We are likely to see a re-emergence of drop shipping and a scenario where manufacturers ship directly to end consumers. Dropshipping involves sending products purchased from a third-party directly to consumers. On the other hand, products can be shipped directly from a warehouse to a consumer. The use of direct-to-consumer shipments and drop shipping brings down the shipping cost. You can, therefore, expect a continuation of this trend into the future.
Treund #6: Multimodal shipping and less-than-truckload will become more popular
The anticipated surge in e-commerce growth and capacity will lead to unprecedented growth in the LTL (less-than-truckloads). There will be fewer trucks available for a full truckload. On the other hand, there will be a consolidation of excess weight into LTL. However, unless the economies of nations improve, logistics trends indicate that carriers will be forced to increase freight rates, especially those for spot freight. The result will be a reliance by shippers on flexibility, so their shipment can be picked up on time.
In the process, some loads will be put on a waitlist while others will be rejected. To navigate higher shipping rates, shippers will need to take advantage of Multimodal and LTL shipping options, which provide a seamless flow of products through several modes.
Trend #7: SaaS to expend the supply chain
Perhaps the game-changer in the supplies and logistics sector will be the expansion of the use of software-as-as-a-service (SaaS). This will see providers extend their capabilities in LTL management, warehouse and transport management, control and execution, and in the provision of e-commerce solutions.
The use of software-as-a-service is gaining a lot of traction in logistics management. This has been greatly aided by the emergence of cloud-computing software. With SaaS, you have at your disposal latest technologies and services at a fraction of what it would cost to have an on-site solution. With SaaS, providers are expanding their capabilities to include LTL management, e-commerce solutions, control and execution, warehouse and transport management, among other services. As the volume of shipments increase, it might be more cost-effective to outsource supply chain logistics to 3PL companies to maintain competitiveness.
Trend #8: Machine-driven processes to increase logistics services efficiency
Changes in machine-driven processes are expected to enhance the delivery of transport and logistics services. However, there is a need to invest in new technologies, which will drive the changes in machine-driven processes.
The expected benefits include work automation, the possibility of fixing bottlenecks, automation of core operations, and new services such as electro-mobility, mixed and augmented reality devices, robotization, last-mile optimization, and high-speed rail. While these technologies will reduce human-to-human interaction, the benefits in the flexibility of services will more than compensate for the lost personal touch.