Running an online enterprise is hard work— so many moving parts and pieces need to come together for your business to succeed. One of eCommerce’s most important but often overlooked aspects is your logistics strategy. In this article, we will be going over the following points with the goal of helping make your digital logistics strategy more efficient:
- Why You Need Digital Logistics
- 4 Ways to Improve Your Digital Logistics Strategy
- Achieving Growth through Digital Logistics
As businesses continue to face many challenges, including supply chain crises, and geopolitical issues that affect global markets, the need for an agile and adaptable logistics strategy becomes more apparent. This reality is what’s pushing more decision-makers to take their operations online and explore digital tools and software.
Many businesses benefit from modern solutions such as automation and cloud-based inventory management systems. Service providers and third-party logistics (3PLs) have stepped up their game. They now offer various products to streamline processes and move operations beyond tracking things on pen and paper.
Going digital for your logistics is a significant investment and takes time and effort to implement properly. A digital logistics strategy will impact your business positively, but it’s essential to know how to do it right.
Why You Need Digital Logistics
With supply chains today under more pressure than ever, businesses need to be flexible and agile to keep up with unpredictable events. The COVID-19 pandemic has exposed many flaws that have burdened and delayed the flow of products from warehouses to customer homes.
Supply chain disruptions are part of the new normal and have put a big dent in business liquidity and solubility. These disruptions can be devastating, causing as much as 62% financial losses, and logistics and reputation take a 54% hit.
Competing in an online market is incredibly fierce, and you will need every advantage. Even in this climate of uncertainty, customers still expect exceptional online shopping experiences. That’s why digital solutions are more paramount now, as they can reduce costs and improve collaboration between partners and stakeholders.
Cost and Time Efficiency
Time is a critical element of logistics. Organizations must plan every step and process, which can only happen through efficient and accurate communication.
As lead times become faster and shipping speed becomes a major factor in consumer consideration, businesses can’t afford to slack with their logistics.
Tedious tasks can be sped up through automation, leaving precious human resources to focus on other essential responsibilities. Access to reliable data helps reduce the risk of errors as well.
You can manage and optimize processes such as raw material flows, operational logistics, or inventory levels with accurate information. It can also improve cash flow and provide cost reductions for your company.
With digital tools, organizations can get real-time visibility into supplier performance and identify gaps that may cause disruptions. It allows them to address the problem before it becomes an issue for their customers or employees by taking corrective action.
Organizations can also quickly view essential metrics associated with websites, marketing, and customer retention. The same can be said for supply chain operations, leading to better decision-making. It also contributes to a better customer shopping experience, which helps generate more profit through repeat transactions.
Streamlined Inventory Management
Digital logistics have enabled businesses to optimize their inventory with full information access. With a digital system, warehouse teams can view real-time updates on how items move through their system and receive customer feedback about order fulfillment workflows. Storage practices within each region’s facilities are constantly under review for improved monitoring. Making informed decisions that impact revenue strategies has never been easier and more transparent.
Greater Trust For Customers
Digital technology has made it easy for customers to track their orders from start to finish. Tracking shipments is a boon for logistics firms and those who rely heavily on them. Each shipment that goes out without human intervention can save time and money.
Customers are happy when they know what’s happening in an online order through instant access at all times; shipping companies benefit because they don’t need to answer client inquiries about delays or cancellations personally. By sending updates automatically, customers are always in the know when it comes to their purchases. It saves both parties valuable resources. This information sharing builds trust, eliminating bottlenecks along the way and reducing possible escalations.
4 Ways To Improve Your Digital Logistics Strategy
There are many exciting ways to incorporate modern digital solutions into your logistics workflow. In 2022, different technologies are already affecting several critical logistics processes such as mobility, warehousing, security, and the stability of supply chains.
Logistics companies must stay on top of market trends to ensure they don’t get left behind. From new technologies to shifting regulations and strategies- it’s all about staying current with what is happening in the industry.
In 2022, the changes in logistics will continue to accelerate. Digitalization and sustainability will majorly impact how businesses work with their partners. Industries from healthcare to retail have already begun or will be adopting these new technologies soon. It’s why you must stay ahead of trends like this now. Over the past year, 59% of companies have implemented new supply chain risk management practices. Among these is the adoption of emergent technologies that power digital logistics.
1. Employ Artificial Intelligence (AI) and Machine Learning (ML)
Integrating cutting-edge AI and machine learning into your systems will help processes become more efficient and increase the capabilities of human staff. Business analysts can quickly evaluate productivity, shipment speed, or customer satisfaction with these new tech tools — all while improving themselves by taking advantage of self-evaluation dashboards that give insights on how they’re doing against industry best practices.
Artificial intelligence has enabled companies to access all the information they need, including billing details. The system can instantly read and process data efficiently while providing a detailed overview of what you’re looking at – whether it be dates or parties included in your contract.
When used effectively, this technology allows businesses to make better decisions, leading them down paths toward higher profitability.
According to an IDC prediction, “By 2023, driven by the goal to embed intelligence in products and services, one-quarter of G2000 companies will acquire at least one AI software start-up to ensure ownership of differentiated skills and IP.”
2. Create a Connected Network
Logistics companies can use a diverse array of consumer-oriented technologies such as wireless locales (e.g RFID, Bluetooth, Zigbee, Wi-Fi), mesh networks, wide area connections, and wired connections to better communicate and connect with customers and partners.
Businesses can streamline their workflows and store and transfer information quicker than ever with the Internet of Things (IoT). New cloud-based systems are also more secure, allowing for greater control over finances. Leveraging the power of IoT, you can harness sustainable frameworks to improve delivery safety by enabling smarter gatherings and alerts in vehicles.
The ability to track assets and materials from manufacturing facilities through vendors while monitoring deliveries is a powerful tool in today’s supply chain management. This data can be analyzed by companies for better customer service as well as reduced costs. You can be instantly notified of products that go missing or have been delayed during the delivery process, thus allowing for prompt updates to customers’ concerns.
3. Multi-channel Management
Many traditional retailers are adapting to the changing landscape of eCommerce by offering more multi-channel touchpoints. This way, customers can easily shop, whether done digitally or in-store.
To stay competitive in the ever-changing world of logistics, companies need to be creative and offer solutions that can adapt as needed. Logistics companies must use every mode of transport available to keep up with the ever-changing market demand. Use road freight when shipping by truck or train, tap waterways, river barges, and even aircraft carriers.
A wide network of fulfillment centers will allow your business to break through different markets easily. And being closer to customers will drastically lower shipping lead times. A system that easily integrates on multiple eCommerce selling platforms makes inventory management simple and fast.
4. Sustainability in Logistics
Today’s consumers are more conscious of the environmental impact of their purchases than ever before. Seventy-seven percent (77%) of American shoppers have expressed concern about the environmental impact of products they buy; 76% said they would switch their preferred packaged goods brands if it meant offsetting carbon emissions.
Climate change and corporate responsibility are becoming top priorities for international businesses. And it is not surprising that sustainability has become a significant trend in logistics. The transportation sector, in particular, has turned its attention to cutting-edge freight technologies designed to increase fuel efficiency and reduce emissions in the face of rising gas prices and increasing costs.
The switch to electric vehicles and alternative biofuels plays a big role in reducing harmful emissions. But perhaps the most simple way of achieving sustainability is through route optimization. By choosing the shortest and most efficient route, businesses can avoid last-mile inefficiencies while having greater insight into estimated arrival times.
Achieving Growth Through Digital Logistics
As the world transitions to more electronic tools and processes, businesses must find ways to keep up with customers’ ever-changing demands. Newer trends in digital logistics promise better profitability, and it is imperative always to be aware of opportunities for your operations.
The logistics industry has changed a lot in the past two years. It’s not just about thinking about how things move; you must think holistically and prepare for what could happen over the next year and beyond.
Unforeseen challenges have plagued logistics and supply chains but have also presented enormous opportunities. After all, these factors raise the stakes of a 4.6 trillion dollar industry.
Over the next five to 10 years, the effects of these disruptions will usher in a wave of digital transformation for both the supply chain and logistics industries fueled by digital ecosystems. Organizations have a tremendous opportunity to take a concept with a 2% global market share to approximately 30% by 2025.
The digital transformation will be the most significant change in many industries in decades. The following five or ten years will determine how quickly businesses can adapt, or lose out on potential profits if they cannot keep up with customers’ demands.
It’s no wonder that there’s been so much money invested into researching new technologies like blockchain-based solutions for tracking goods. In fact, from now to 2025, digital ecosystems represent approximately $60 trillion in global revenue.
There is a tremendous opportunity to make your digital logistics work, and ZhenHub is here to help. Revamp the way you do your fulfillment through our digital warehousing and software suite that helps automate your logistics processes while providing real-time data. Revolutionize your online business by signing up now.