In the current technologically powered era, no one can deny the capabilities of IoT in creating a connected world. And by connected, I don’t mean people connected. IoT has enabled non-living assets to connect and share information over a wide network spread across miles.
This disruptive technology has been a huge influence for multiple industries. One such sector that has expanded from the advent of IoT is the industry of logistics and transportation. Disruptive technology impacts industries that are quite dependent on their wirelessly connected physical devices and is hence one of the prime movers towards the technology of IoT.
Most of the investment has been made in the procurement of IoT hardware and creating a network for long-range communication. From 2018 to 2026, the market segment of IoT in logistics is expected to grow at a CAGR of 12.4% and reach a total market capitalization of $63.7 billion in 2026, according to Transparency Market Research.
This statistic represents the rise of IoT applications in the logistics and transportation industry. Let us see the impact of this cutting-edge technology in these verticals.
The impact of IoT in logistics
By scrutinizing the processes involved within a logistics industry, the impact of IoT can be easily observed. IoT has allowed logistics companies to automate warehouse operations, enhance freight transportation and ensure timely final delivery of products.
Many people consider integrating IoT in a logistics setup to be quite expensive. However, the benefits of its installation outweigh its integration cost. Also, it only takes a portion of the integration cost to maintain the IoT system. Once integrated, an IoT system can work for quite long durations to ensure the safety and security of the workers, elevate customer experience and achieve operational excellence.
An IoT system allows a logistics company to:
- Monitor key performance indicators and essential parameters that affect assets.
- Obtain live alerts about every aspect that might affect effective distribution.
- Identify inefficiencies that might result in delivery delays.
- Automate processes to eliminate human errors, reduce human intervention, reduce costs and improve quality.
By collecting a large amount of data gathered through IoT devices installed on their end assets, logistic companies can easily process them through big data and cloud computing capabilities to generate useful insights. They can refine their operations and make smart decisions to improve their overall efficiency. Let us look at some of the application of this cutting-edge technology in logistics:
Fleet and asset tracking. Logistics is completely dependent on its on-field operations along with its mobile assets and fleet. IoT allows transportation companies to collect information about assets on-site and vehicular information. This daily monitorization allows them to maintain the schedule of employees and manage the usage of trucks remotely.
Moreover, IoT results in effective communication between fleet operators and truckers along with establishing transparency between them. Companies can hence track the location of its fleet trucks and increase response time in case of an emergency. Real-time information also allows companies to confirm that the truckers are following guidelines and ensures timely delivery of the goods.
Proper inventory management. The integration of IoT in the logistics segment also enables companies to streamline their processes and elevate the functioning of their warehouses. Companies can have clear visibility into the supply and demand condition and can hence maintain proper stock levels to take proactive measures in case the demand fluctuates.
Sensors, RFIDs and other hardware allow companies to maintain proper inventory, avoid overstocking and help in balancing the supply and demand in the market. Companies can monitor inventory levels on a daily basis and gain alerts if the stock goes down below the required thresholds. Moreover, IoT solutions can also be programmed to automatically contact the vendor to increase or decrease the production rate as per stock in warehouses.
Better resource utilization and management. The use of IoT also helps companies to manage their resources and assets in an optimum manner. This results in increased operational efficiency and proper utilization of resources.
IoT has allowed the development of connected vehicles that modern-day fleet companies can use to pace up their delivery system. Connected with GPS and other online geolocation tools, trucks can automatically gain directions to their destination and information about traffic on roads. As a result, fleet companies can reduce fuel consumption and ensure timely cargo delivery.
Better customer service. For customers that want to know the entire manufacturing and distribution cycle of the products they purchase, companies can now offer them the ability to track it via IoT solutions. They can have real-time information about their products being shipped and can track orders remotely. This improves customer experience and helps companies optimize their delivery chain based on the information gathered from their customers. This also creates the goodwill of a brand among its customers and drives the selling of more products.
Future possibilities of IoT in logistics segment. In the time to come, IoT can be expected to witness tremendous growth in transportation and logistics verticals. Fleet managers and operators will have more access to remote information at their fingertips and will use this information to reduce cost, mitigate human errors, boost supply chain productivity and automate end-to-end logistics processes.
Along with the capabilities of cloud computing and big data, IoT can also be used to predict bottlenecks that result in inefficient operations in a logistics business. Moreover, working conditions can be improved and resources can be optimally utilized to ensure timely delivery of goods, increasing customer satisfaction.
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