The global logistics industry is growing at a surprisingly fast rate, considering how large it already is. A study by Allied Market Research projects that the industry will be worth nearly $13 trillion by 2027.
As the industry grows, logistics providers must adapt to evolving needs. This entails utilizing new technology to keep up with different challenges. Smart fleet management companies will use new technological breakthroughs to better assess risks, forecast future demand and offer services more seamlessly.
Many technological trends are shaping the logistics industry. One of the biggest trends is the growing use of blockchain technology, which has led to the use of RFID asset tracking. Some of the most important are listed below.
Growing reliance on artificial intelligence
Artificial intelligence is becoming more critical to the logistics industry than ever before. Demand for AI technology in the logistics sector is growing at a rate of 24% a year. Logistics companies only spent about $1.7 billion on artificial intelligence in 2018 but are projected to spend over $12 billion on AI technology in 2027.
There are numerous reasons that artificial intelligence is becoming heavily integrated into the logistics sector. Some of the reasons are listed below:
- AI is improving security. Many fleet management companies have discovered that artificial intelligence can enhance the security of their full and partial load trucking services. One supply chain company spent over $10 million on an AI system to transport goods more securely.
- Predictive demand capabilities. More businesses than ever are using predictive analytics to anticipate the future demand for their services. This is even more important for logistics companies. They must accurately forecast the demand for all of the different products that their customers are selling. This information makes it much easier for them to allocate sufficient resources to meet future supply chain needs.
- AI is helping improve transportation efficiency. Supply chain management companies have used artificial intelligence to better plan their routes. This allows them to transport goods much more efficiently.
AI technology is a godsend to the logistics sector. More fleet management companies will rely more heavily on it in the future.
Dependence on blockchain technology
Blockchain technology is most frequently used in the transfer of cryptocurrencies. It was actually invented to support the use of bitcoin.
However, there are a lot of other applications of blockchain. The logistics industry has discovered many benefits of using blockchain technology as well. Some of the reasons that blockchain is being used in the logistics sector include:
- Blockchain provides greater transparency for consumers. Logistics companies can use blockchain to keep detailed ledgers of purchases. This allows customers to track their purchases more easily. They will know if there are any issues and anticipate when it will be delivered.
- Blockchain technology provides better transparency for audits. Every logistics company needs to be prepared for audits. However, they will have an easier time dealing with them if they can provide greater transparency. Blockchain provides this transparency to make audits go smoother.
- Blockchain can improve security against potential fraud. Fraud is a common problem in the logistics sector. Blockchain technology has significantly enhanced security of logistics data, which mitigates this risk.
- Blockchain makes it possible to use smart contracts. Blockchain has also made smart contracts possible. This has reduced a lot of the minutia of finalizing contracts.
Blockchain technology is precious to logistics sector. More supply chain and fleet management companies will use it in the coming months.
Growing importance of cloud technology
The cloud has become incredibly important to many businesses. One study found that 70% of companies believe they will start using cloud computing soon if they have not already started to do so.
The logistic sector is very dependent on advances in cloud technology. This industry is heavily reliant on large volumes of data. The cloud makes it a lot easier to store this data and access it easily.
Dependence on virtual reality
The global market for virtual reality technology was worth nearly $16 billion last year. It is projected to grow by an astonishing 18% a year until 2028.
The logistics industry is one of the biggest consumers of virtual reality services. There are many reasons virtual reality technology is becoming so important to this sector.
One of the most important benefits of virtual reality is that it helps train drivers. Drivers need to be able to deal with many dangerous and complicated scenarios. Virtual reality technology helps them better prepare for these issues.