Embracing Logistics Technology: A Primer

In an era where technological advancements are rapidly changing the landscape of every industry, logistics and supply chain operations are no exception. Businesses face increasing pressure to integrate advanced technologies to stay competitive. However, the investment of money and resources required to implement these technologies can be daunting.

For many companies, the solution lies in partnering with a third-party logistics provider (3PL) that has already made key investments in logistics technology. This article explores how partnering with a 3PL allows businesses to reap the benefits of cutting-edge technologies without the heavy financial burden of implementing them in-house.

What technologies are essential for today’s supply chains?

The following technologies have become the backbone of modern logistics operations, streamlining processes and improving visibility.

1. Warehouse Management Systems (WMS): WMS systems are essential for managing inventory levels, orders, and fulfillment processes efficiently. They help in optimizing warehouse operations, reducing errors, and improving overall productivity.
2. Transportation Management Systems (TMS): TMS solutions provide 3PLs with tools to plan, execute, and optimize the physical movement of goods. This includes route planning, load optimization, carrier management, and freight audit and payment.
3. Radio-Frequency Identification (RFID) and Barcode Technology: These technologies help enable WMS systems, TMS systems, and other systems to track inventory and assets in real-time. They also help in automating data collection, reducing manual errors, and increasing operational efficiency.
4. Global Positioning System (GPS) Tracking: GPS technology is used to monitor the real-time location of vehicles and cargoes, enhancing the visibility and security of the supply chain.
5. Electronic Data Interchange (EDI): EDI is a critical technology for exchanging business documents in a standard electronic format between business partners. It streamlines transactions such as purchase orders, invoices, shipping notices, and bills of lading among stakeholders in the supply chain.

A look at emerging supply chain technologies

The adoption of the following technologies is gradually becoming more common within the supply chain.

1. Advanced Analytics (Business Intelligence): By leveraging data from various sources, 3PLs can gain insights into optimizing routes, reducing costs, and improving service levels through predictive and prescriptive analytics.
2. Internet of Things (IoT): IoT devices can monitor the condition of goods in transit (like temperature and humidity in temperature-controlled transportation) and the status of assets (like the operational health of vehicles), providing valuable data for predictive analytics and maintenance.
3. Robotic Process Automation (RPA): RPA can automate repetitive tasks such as data entry, billing, and order processing (e.g., eCommerce picking and packing), freeing up human resources for more strategic tasks.
4. Artificial Intelligence (AI) and Machine Learning (ML): AI and ML can analyze vast amounts of data to forecast demand, optimize routes, and automate customer service through chatbots, significantly enhancing operational efficiency and customer satisfaction.
5. Autonomous Vehicles and Drones: For drayage and final-mile delivery, autonomous vehicles and drones present a future-forward solution that could drastically reduce labor costs and improve delivery times.
6. Blockchain: Offering a secure and transparent way to record transactions, blockchain can significantly improve the trust and efficiency in supply chains by providing a secure ledger shared among participants.

Why is technological adaptation crucial?

Logistics technology plays a crucial role in the modern supply chain, addressing efficiency, cost, and reliability. By automating tasks that were traditionally performed manually, logistics technology significantly reduces the time and cost associated with these operations. Automation not only streamlines processes, making them faster and less prone to error, but also allows for a more efficient allocation of human resources.

This shift towards automation is especially critical in times when skilled logistics labor is scarce or when social distancing measures are in place, ensuring that logistics operations can continue smoothly despite workforce challenges.

Furthermore, logistics technology enables real-time tracking and visibility of shipments and inventory, which is invaluable for companies wanting to maintain tight control over their supply chains. The ability to track orders in real-time not only enhances customer satisfaction through timely updates and transparency but also allows businesses to quickly address any issues that arise during transit, reducing delays and improving overall reliability.

This level of visibility is complemented by advanced analytics and reporting tools that help companies monitor key performance indicators and make data-driven decisions. By analyzing data on shipment times, carrier performance, and inventory levels, businesses can identify inefficiencies, optimize routes, and improve supply chain planning.

The Shared Cost Model: Technology Without the Full Burden

Companies that are eager to adopt the logistics technology wonders listed above often have their excitement tempered by the hefty price tags that come with implementation. Fortunately, these costs are not a burden you need to carry yourself.

Instead of investing millions in technology, businesses can tap into a 3PL's existing infrastructure – enjoying the efficiency-boosting benefits of tech, while only sharing the cost with the 3PL and its other clients. This shared cost model allows for:

• Scalability: Whether you're a small company or a larger operation, you can scale your logistics operations up or down without worrying about outgrowing your technology investments.
• Lower Risk: Technology investments carry the risk of becoming outdated. By outsourcing logistics to a tech-enabled 3PL, you’re not stuck with the responsibility of keeping up with the latest advancements—your 3PL can take care of that for you.
• Access to Expertise: Partnering with a 3PL provides access not only to their technology but also to their expertise in using that technology efficiently. This can improve your supply chain operations without requiring your team to develop in-depth knowledge of complex logistics technologies.
  
  

The Consequences of Inaction

Failing to embrace logistics technology—whether in-house or through a 3PL—can have significant consequences for businesses. In today’s fast-paced market, customers expect real-time updates, rapid order fulfillment, and complete transparency. Companies that rely on outdated manual processes may find themselves unable to compete on cost, speed, or service quality. By partnering with a tech-enabled 3PL, businesses can avoid these risks and ensure they remain competitive in an increasingly digital landscape.

Offering integrated logistics services (port services, warehousing, and transportation) from the West Coast, Weber Logistics has made thoughtful investments in automation, scanning and labeling machines, and real-time tracking tools that are essential for modern logistics operations. By partnering with Weber, companies can access these technologies as part of a shared cost model.