White PaperIs technology driving the future of logistics?

Experience a safer and more open world

By Frederic Geneix Business Development Manager, Traka

Logistics companies are in a strong position, but to remain successful, many need to understand that they are facing a dynamic era of unprecedented change, as mobile applications and digitisation takes hold and customer expectations grow.

New smart and automated technologies are enabling greater efficiency; they’re also re-shaping the marketplace in ways that are only just beginning to become apparent, yet likely to evolve at an incredible pace.

The race is on to define the industry’s future and ensure continued success. And with an estimated US$4.6 trillion1 of revenue at stake, companies need to adapt to changing markets proactively.Some of the many key influencing factors include changing customer expectations, technological breakthroughs and increasingly stringent health and safety standards.

These issues have very different implications for individual companies, depending on which segments they operate in, their type of ownership, and where they are located.

Synopsis

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1. Data quoted from ‘Shifting Patterns: The Future of The Logistics Industry,’ as part of PwC’s future in sight series. Please visit https://www.pwc.com/sg/en/publications/assets/future-of-the-logistics-industry.pdf

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B2C: New shopping patterns

Consumers went digital long before many of the retailers, and some parts of the sector are still struggling to keep up, as can be seen in the issues faced by today’s high street decline.

In response, retailers now aim to create a seamless customer experience across personalised marketing, the physical store, the digital experience, delivery and payment options. All of it driven by a desire for a strong and consistent brand image.

Whilst logistics can be seen as part of the equation, it is increasingly apparent, especially with the evolution of Amazon Prime and expectations of affordable two hour delivery slots, that consumers care less about who delivers their goods, as long as they are received reliably, quickly and cheaply.

Changing Customer Expectations

Many others want more flexible delivery, and most are not willing to pay for shipping. Though, they are prepared to pay a premium for additional services, such as faster ‘next day’ delivery and/or for high-value items.

There’s also currently a low acceptance of dynamic pricing for parcels; customers again ‘expect’ to pay the same price for shipping regardless of seasonal capacity constraints faced by their shipper, with the exception of surcharges for same day, overnight or expedited service. And savvy consumers will have prior knowledge of ‘expected’ costs for delivery at any given time.

B2B: Supply Chain Opportunities

Like individual retail consumers, industrial customers equally expect to get shipments faster, more flexibly, and with more transparency at a lower price.

Manufacturing industries are facing far greater prospects around efficiency and performance than ever before. Their customers demand faster time-to-market, reduced defect rates and customised products.

Ultimately, the result may be a goal that was once impossible: where each product is manufactured to the specifications of a specific end-customer.

The advent of the industrial Internet of Things is allowing manufacturing companies to redefine everything from the way they interact with customers to how they structure supply chains and delivery.

Technological Breakthroughs

Like every industry, technology is changing every aspect of how logistics companies operate, to the extent it is expected to be the most impactful trend over the coming years, reshaping entire businesses.2

‘Digital fitness’ will be a prerequisite for success: the winners will be those who understand how to exploit a whole range of new technologies, from data analytics, through intelligent systems to improve distribution efficiency, accountability and safety, all used in conjunction with automated and platform solutions.

But with so many technologies competing for management attention and investment, defining a clear digital strategy that’s integrated into business strategy will be critical.

The route to success will be meeting the consumer demand. In Traka’s work with Primark, it was highlighted how, “products fly off the shelves and rails, so we need to get our products from suppliers to stores as quickly and as safely as possible.”

Leading UK and European retailers are recognising the constant demand to grow and evolve, “driving new standards in design and use of technology to ensure our products get to our customers on time, in full.”

Logistics teams have an enormous responsibility to perform every minute of every day, with no margin for error or delay. Technological breakthroughs can make an instant difference and add value, with the ability to grow and meet ongoing requirements for long-term efficiency, productivity and critical processes optimisation.

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2. Quote from ‘Transportation & Logistics 2030,’ “Volume 1: How will supply chains evolve in an energy-constrained, low-carbon world?” https://www.pwc.co.uk/assets/pdf/transportation-and-logistics-2030-volume-1.pdf

Health And Safety Standards

The health and safety management system market continues to grow on a general scale, owing to driving factors such as strict Government regulations, changing workplaces, global sales and increasing adoption of security measures across industries.

In the logistics market, it is increasingly prominent. Organisational changes to customer expectations, and conflicting demands in a growing and globally operating service economy all contribute to escalating concerns. These include fatigue, stress and a variety of musculoskeletal disorders, in the warehouse, transport and logistics environment.

Technological changes are hard to keep pace and have also led to an ever-increasing need for training. And the diverse working population, including an ageing labour force and rising proportion of flexible working, has required an adaption of working conditions and opportunities.

Each factor carries its own issues when it comes to health and safety processes; not least in reliably recording documents such as drivers licences, medical checks and key management for restricted areas. Here, full audit trail capability and access control capability can assist to manage process, demand and keep an operation moving to achieve delivery success in increasingly expected record times.

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Further Influences

With the rise in smart technology and digital opportunities, the industry has seen a rise in new business models and start-ups, keen to embrace the rising demand for fast pan-global delivery.

Traditional businesses and major players are being forced to step up their competitive dynamics when it comes to process optimisation and delivery of goods. Moving away from outsourcing delivery, to integrating logistics into an owned company offering, maintaining tight management processes at all times here has proven essential.

Amazon again is an obvious example: it’s looking to expand its in-house expertise in warehousing as well as develop its own delivery capabilities. The company, like many retailers across Europe, has embraced warehouse automation, leased aircrafts to handle shipments and is reporting to be imminently ready to deliver purchases in 30 minutes using drone technology.

There is also a notable shift in culture to presenting collaborative approaches to logistics, where accountability and consistency are key to success.

Just these few influences on the logistics market discussed have proven to make a significant difference to the sector and its success in an ever changing European, and arguably global economy.

To stay ahead in such a dynamic environment, requires preparation to reduce overheads and lower the risks. The better the strategic market, operational efficiency and corporate foresight, the greater tools such as equipment and key management to enable greater and fluid movement, the safer the subsequent success of logistics service providers.

In our research and summary, we would suggest logistics companies across Europe have an exciting opportunity to meet the growing expectations of customers, remain profitable and generate growth. This is either in B2B or B2C climates, where it will be crucial to commit to an identity and develop a clear strategy, focusing only on markets where they believe they have a ‘right to win’.

Summary and Conclusion

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Companies need to discover in themselves whether they have the distinctive capabilities they need to compete. If not, can they develop these and use collaboration to succeed, seeking support from companies such as Traka, that can bring a focus on ‘digital fitness’, cost efficiency, increase productivity, process optimisation and innovation if they want to meet changing expectations. See appendix to learn more how Traka can help you.

Building and refining these and other capabilities, and then bringing them to scale across the enterprise, will be key as they translate the strategic operations into the everyday.

Appendix

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Securing a futureproof logistics operation is not an easy task as has been identified in the contents of this white paper. With multiple distribution and storage facilities, a large vehicle fleet and potentially thousands of personnel working along the supply chain, it can quickly consume valuable administrative resources.

Traka, as a global solutions provider, efficiently bridges the gap in many safety and security strategies, providing automated and controlled access to keys and shared equipment, including PDA, laptops, tablets, vehicles, specialised devices and more.

Through Traka’s software-controlled key cabinets and lockers every activity is recorded, generating more responsible users and complete audit control visibility for all protected items.

Benefits In Key Management

• Control access to all keys and sensitive areas for better security

• Every key and user transaction is recorded for complete visibility

• Define unique access restrictions to specific key sets

• Require multi-level authorization to release grand master keys

• Easily manage temporary access for contractors or maintenance workers

• Report key usage, identify when keys are taken and returned, and by whom

• Automatically alert when keys are not returned on time, via email or SMS

• Through integration, ensure that critical keys never leave a site

Benefits In Equipment Management:

• Manage and control the use of PDA, laptops, tablets, scanner, specialized equipment and more

• Items are secured in intelligent lockers and automatically distributed to authorised users

• Create a controlled environment, so users are 100% accountable for the items they use

• Integrated power charging and data connections are available to ensure that devices are always ready for use

• RFID tagging can be used to uniquely identify each device

• Traka’s administration software provides full and instant audit control capability

• Collect valuable data on item usage to reduce inventory

Traka solutions can be integrated into existing database or third-party platforms, making administration easy, and enabling real-time workflows that improve operational processes.

For more information, please contact Frederic Geneix, or visit traka.com

The ASSA ABLOY Group is the global leader in access solutions. Every day we help people feel safe, secure and experience a more open world.

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