End-to-end supply chain visibility will be a critical differentiator for leading companies
Without tracking data, usually in the form of check calls, it is difficult to know what goes on when shipments are in transit. This leaves plenty of opportunities for load delays, loss, or damage to go unnoticed and uncommunicated. Real-time visibility helps fill in the blanks to ensure that any issues or delays are identified, communicated, and dealt with accordingly before they result in more costly disruptions further down the line.
Global freight demand will triple
Freight transport and logistics is key for European industry competitiveness and sustainable growth. It is estimated that logistics accounts for 10-15% of the final cost of finished goods, hence the competitiveness of industry sectors (such as the automotive and the food industries) relies heavily on the performance of freight transport and logistics. According to SETRIS, a 10-30% improvement in efficiency in the EU logistics sector would potentially equal a €100–300 billion cost relief for the European industry, as well as reducing CO2 emissions by up to 30%. Increasing competitiveness is also more important than ever, as the OECD ITF Transport Outlook 2019 stated that global freight demand will triple between 2015 and 2050, based on the current demand pathway. Of the 108 trillion ton-kilometers (tkm) transported worldwide in 2015, 70% traveled by sea, 18% by road, 9% by rail, and 2% by inland waterway. Less than 0.25% of global freight in tkm is transported by air. Therefore, to make any kind of impact on sustainability initiatives and tackle the global freight demand, supply chains must be transformed as growing numbers of consumers will turn their backs on companies that do not demonstrate sustainability.
Shippers are looking for efficiency gains
Multimodal transport systems have become the backbone of international trade - with the objective of reducing overall transport and handling costs within the supply chain while responding to the demand for just-in-time door-to-door cargo services. But real efficiency gains can only be reached when end-to-end visibility data is available across the supply chain, to enable better decisions related to risk management and performance improvement.
One of the prerequisites for tracking transport successfully is accurately determining the location of the stops and further detecting arrivals and departures. Machine learning algorithms, together with historical data, can be used to automatically determine the most precise stop locations and loading/unloading times. No interaction from shippers is needed after the stop address is provided - these intelligent systems can take care of everything, even if the address is not precise or contains mistakes, or if telemetry signal quality is corrupt.
It’s these kind of use cases that can significantly improve efficiency for shippers, primarily by streamlining processes and reducing the need for manual interference. They can also improve customer satisfaction, as shipments are more likely to be delivered on time.
End-to-end visibility drives flexible & resilient supply chains
Those with end-to-end visibility can perform what-if analyses and simulations to optimize production and use of materials. According to EY, consultants are seeing some supply chains deliver 20-25% cost savings and reductions in inventory while improving overall service levels. For example, this year’s German Logistics Award winner, Italian multinational food company Barilla, managed to take 5000 trucks off the road thanks to the train link between northern Italy and southern Germany, thereby reducing CO2 emissions by 70%. This is a great example of how shippers can benefit from a supply chain execution platform powered by an end-to-end view of a supply chain’s transportation to empower more efficient, more sustainable, and more crisis-resilient supply chains.