Location forecast: what's next for supply chains in 2024
From innovative ways of employing data to industrial drones, the way we move our goods around is changing. What does 2024 hold for logistics?
Supply chains have been forced to become more agile and resilient since they were rocked by a series of disruptions in recent years. But a HERE survey of logistics firms in Asia this year found that almost half still relied on manual inputs for portions of their asset tracking and shipment monitoring. Technologies can help provide greater visibility and therefore control, but only when the right solutions are implemented.
Survival has been the mantra for many organizations since the pandemic. However, more than three years have now passed since that event. Many organizations are now powering up investment for what lies ahead. According to a report by Gartner, with an estimated revenue of US$20.24 billion in 2022, supply chain management (SCM) is the fastest-growing market sector. What's next for global logistics, and how is innovation shaping the way we move goods around in the world in 2024 and beyond?
Elastic logistics has become a buzzword, replacing concepts such as just-in-time manufacturing. It means being able to adapt to changing demand by shrinking or expanding as needed. Now that the demand side can be unpredictable, this is a more effective way of managing inventory. It also makes operations more efficient and ultimately saves money.
However, to become truly elastic requires moving away from the manual processes that still dominate the industry. HERE Product Marketing Manager Bjarne Jensen told HERE360: “Visibility and having strong partnerships are important ways of tackling this."
Companies have gradually moved toward local delivery hubs and nearshoring as ways of making their supply chains more adaptable. Another good example of elastic logistics is HERE customer Satalia. The firm creates bespoke marketing campaigns based on what its customers have in stock, ensuring that those items are moved off the shelves at the right time.
AI, route optimization and efficiency
According to IBM, 46% of supply chain executives anticipate that AI/cognitive computing and cloud applications will be their greatest areas of investment in digital operations over the next three years. While many enterprises collect large amounts of data, advanced algorithms are necessary to process it and gain valuable insights that can improve operations.
As HERE Product Marketing Manager Alex Osaki told HERE360, route optimization has much to gain from deploying AI.
“It's one of the obvious cases where you have a lot of data that is very easily anonymized and grouped in a rigid and formulaic way," he said. "It really is one of the best-case scenarios where AI can generate useful results."
Expect to see huge investment in this area in the coming months and years.
Creating a buzz
Drones are being trialed as last-mile delivery vehicles in many locations. At the same time, there has been a rise in industrial-sized drones that can deliver substantial packages to nations consisting of many islands, such as Indonesia.
With geofencing and reliable maps, these vehicles can be more efficient than ships and boats.
The face of "Main Street" is changing. Transformations already underway before COVID-19 were accelerated, and not only in the direction of online deliveries. How do retailers make sense of this new world, and understand where the best locations are for physical stores?
One way is to use traffic data to understand how people move around now and where the most footfall is. Several retailers are already doing this, including HERE customers. They can even build digital twins to test out several scenarios before committing to any big new investments.
Critical to placing a shop is surrounding infrastructure, parking, energy management, and other leisure options that might attract people. It is a complex picture, but digital twins can continue to be deployed once the store is up and running, helping retailers manage stock, understand patterns of demand and reduce waste.
While we have already seen them used in other sectors such as construction, expect to see digital twins in the retail sphere in a town near you very soon.
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