Top Logistics & Supply Chain Trends to Watch in 2022
Emerging technologies. New market entrants. Ever-shifting customer expectations.
Change indeed seems to be the only constant in the world of supply chain and logistics. The industry has witnessed more transformation in the past few years than it has in perhaps the entire previous century. In the face of digitization and evolving customer expectations, companies must adapt to the new market realities in a proactive manner. Especially given the abundance of options available to customers today, it is more vital than ever for firms to constantly evaluate their operations and stay on top of trends in logistics and supply chain in order to remain competitive.
Let’s take a closer look at some of these trends that we can expect to see in 2022!
Trend #1: Omnichannel Supply Chain
Even if you have never heard of the term itself, the idea of an omnichannel supply chain — a multifaceted but coordinated effort to move products from end-to-end seamlessly — has been around for years. In an ideal omnichannel scenario, all elements of the supply chain, including resources and channels, are synchronized to bring shoppers a more fulfilling shopping experience. This ultimately allows for the perfect balance between customer satisfaction and inventory management.
According to McKinsey, more than half the customers utilize three to five channels each time they make a purchasing decision. Players looking to add e-commerce offerings to their offline business should first consider their unique customers’ needs and identify the top two or three cross-channel customer journeys that can deliver significant value. A customer-centric stance, coupled with a journey-focused approach appears to be the key to building a comprehensive omnichannel experience.
Sephora was among the early adopters of a successful omnichannel strategy. After closing down nearly all its physical outlets in the early-pandemic days, the company rolled out virtual reality (VR) demonstrations and appointment-based consultations to cope with the decline in foot traffic. A key element of Sephora’s omni-retail strategy is its mobile app, which provides customers with a single point of access to everything related to beauty and cosmetics. There is even an artificial intelligence-driven chatbot equivalent to a friendly salesperson to offer beauty advice and personalized recommendations to customers who need the assistance.
Trend #2: Digital Twins Technology
Though the concept of digital twins has existed since the 21st century, it is now at a tipping point where widespread adoption is likely in the near future. A digital twin, in essence, refers to “a computer program that uses real world data to create simulations that can predict how a product or a process will perform.” Together with emerging technologies such as the Internet of things (IoT), artificial intelligence (AI) and cloud computing, digital twins have the potential to revolutionize many modern industries including logistics and supply chain.
Needless to say, the benefits are endless for companies that can afford this innovation. First and foremost, digital twins can enhance shipment protection by finding out how different packaging can affect a product, even before the first delivery leaves the warehouse. Using sensors to collect and transmit multiple data points during an actual shipment, it helps to identify any possible loopholes in the production-to-delivery process.
Moreover, companies can visualize and evaluate any pending changes to a warehouse layout or rethink the addition of new equipment before making the actual changes. DHL, for instance, is working with food packaging manufacturer Tetra Pak to simulate all activities and machinery using a digital twin at one of their warehouses. They are thus able to study the movement of packages and the functionality of machinery without interfering with current operations.
Trend #3: Smart Warehousing
Smart warehousing is yet another innovation that is reinventing the world of logistics and supply chain. Similar to smart homes, a smart warehouse is equipped with the necessary technologies and infrastructure that work together to increase the productivity and efficiency of operations. With proper planning and deployment, automation in warehouses can help to lower logistics costs by a whopping 40%.
One of the other major benefits of smart warehousing is maintaining inventory accuracy. Implementing an inventory control platform with asset and inventory tags enables automation of stock counting, which in turn allows for real-time, accurate reporting that can be accessed from a remote location. Furthermore, when a significant component of the warehouse management system integrates with automation, it eventually optimizes time by reducing the demand for human labor. These systems working in tandem will increase customer satisfaction while growing brand loyalty by meeting the ever-growing consumer expectations.
Founded in 2015, Exotec is a French unicorn that is known for its “Skypods”, their signature offering that utilizes robots to perform basic tasks. Through this solution, regular warehouses can be converted into partially-automated logistics platforms. Rather than constantly moving around, workers can now focus on tasks that require more cognitive work and complex reasoning.
Trend #4: Autonomous Vehicles in Last-Mile Delivery
No longer the stuff of science fiction, unmanned vehicles are paving the way for a drastic disruption in logistics and supply chain. The last-mile delivery sector is fueled by the fast development of e-commerce and customers’ expectations. More and more shoppers are demanding same-day or next-day delivery and they are willing to pay more for these services.
Unlike in the past, drones and autonomous robots today are increasingly affordable and easily accessible to consumers worldwide. This is partially due to companies like Flytrex that are specialized in building drones that “can be operated with minimal input and at low price.” When it comes to small packages, drones are a better option since they can help to automate the delivery process while simultaneously minimizing the costs of transporting goods over short distances. When paired with an efficient transportation automation system, last-mile delivery using drones could benefit businesses and consumers alike.
Alibaba is one prominent example of a company that has achieved great success in the autonomous vehicle industry. The Chinese e-commerce giant has 200 operating robots and has reached more than 200,000 customers in 52 cities across 22 Chinese provinces. With a proprietary multi-sensor fusion solution and AutoDrive, their robot “Xiaomanlv” is powered by a machine-learning algorithm that can simulate over 10,000 possible scenarios, such as extreme weather conditions and poor visibility at night.
Trend #5: Reverse Logistics
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