The Effect of Digitization on Shipping and Logistics Home > Blog > The effect of digitization on shipping and logistics Table of Contents The shipping
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Supply chain management (SCM) is the process of planning, monitoring, and managing materials and services throughout the supply chain to meet customer demand and achieve business goals. In other words, SCM optimizes the supply chain network so businesses can be more efficient.
Supply chain management is a dynamic field that is constantly changing with the introduction of new technologies and evolving management practices. Today’s customers expect supply chains to be more agile, leaner, and transparent. The need to efficiently manage supply chain networks has led to the growth of the supply chain management industry, which is projected to reach a market size of $19 billion in 2028.
On the other hand, there are challenges posed by economic, political, and technological disruptions. however, where there is a challenge, there is also an opportunity for creative logistics firms to successfully manage their business. New trends in SCM are emerging with AI, blockchain, and IoT technologies. Businesses can benefit from understanding these future supply chain trends to improve profit margins and increase customer satisfaction.
In this blog article, we will take a look at some of the biggest supply chain trends emerging in 2022 and 2023. We will also give some ideas for you to consider when adopting these future supply chain trends.
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Top 5 Supply Chain Trends of 2022/2023
Post COVID-19 Resilience
As the effects of the COVID-19 outbreak begin to recede, many supply chain companies are looking to shift gears from survival mode into a growth mode. The spread of the pandemic forced many businesses to close down during lockdown, which caused extensive physical disruptions in the supply chain networks around the world. Businesses are now more cautious about the negative effects of global-level disruptions, and looking for ways to minimize the risks.
- Be proactive in your approach to uncertainty and add risk management practices into your SOPs.
- Deprioritize minimizing the cost of your supply chain operations. Instead, focus on mastering techniques that can turn a supply chain practice into a meaningful business strategy.
Blockchain is expected to be one of the top trends in supply chain management in 2023 as businesses continue to discover new ways to use it and people become more familiar with it. Blockchains allow supply chain companies to gather data from multiple sources in ‘blocks’ or ‘chunks’ that are chained together over time. The advantage of using blockchains over centralized databases is that they offer greater transparency of supply chain transactions with minimal technical downtime.
A blockchain system can be used to track goods along the supply chain and monitor factors like temperature or location. This can be helpful for businesses to avoid counterfeit items and traceability issues. It also can be useful in optimizing supply chain operations, including inventory management and forecasting. With such a system, businesses can manage their supply chain networks more efficiently by tracking goods from production to the customer.
What is more, blockchains also serve as a way to conduct fast financial transactions without needing a bank or a third party. Many companies now offer blockchain-based supply chain solutions for businesses that wish to have an edge over their competitors.
- Consider a decentralized blockchain solution for global supply chain inventory visibility
- Implement a tokenized solution to account for process costing using blockchains
- Consider a blockchain payment system for permissionless cross-border payments
- Reduce paperwork by storing data persistently on a blockchain network
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Circular Supply Chains
Conventional supply chains are linear in nature, resulting in the creation of waste that is problematic to dispose of. On the other hand, circular chains circulate end products and unused components back into the value chain.
A circular supply chain is one that “closes the loop” by repurposing materials and closing the supply chain loop at the end of a product’s life. This means moving away from a tranditional linear model that begins with raw materials and end when the product is used up and thrown away. Instead, companies are now looking at ways to reuse materials that are already part of their supply chain.
The net result is a zero-waste environment. A circular supply chain will, hence, become indispensable as the world’s population grows and finite resources dwindle.
- Procure recycled supplies and environmental-friendly materials in your supply chain
- Partner with local or indigenous communities to work on mutually-beneficial sustainability initiatives
IoT, Cloud Computing, and Supply Chain as a Service (SCaaS)
With the supply chain becoming more complex due to uncertainties, new technologies, and stricter regulations, many companies are having a tough time managing their supply chain networks. For instance, the recent pandemic has forced companies to fully transition into a digital environment. Companies are turning to organizations that focus solely on providing specialized supply chain services (SCaaS model).
The SCaaS model utilizes the power of the Internet of Things (the web of interconnected devices that gather, store, and transmit data) and cloud computing. The two technologies, when combined, create a seamless digital supply chain interface.
With the help of a SCaaS partner, supply chain managers can access platforms that enable insightful data analytics to make impactful business decisions. They also give supply chain companies the flexibility to hire staff on a hybrid-remote or fully-remote working basis.
- Focus on hiring top talent that can analyze your supply chain data
- Work closely with technology experts to see how you can benefit from SCaaS infrastructure while minimizing your costs
- Train your employees to transition to a digital working environment
Artificial Intelligence (AI)
Supply chain managers understand the benefits of powerful software. With advances in computing power and AI, software packages have become more sophisticated and are now capable of making intelligent predictions. One of the biggest trends in supply chains is the use of AI in demand and sales forecasting, and product inspections. Additionally, Artificial Intelligence also helps companies in automating decision-making and customer support.
For any supply chain manager, AI is a big deal, as it means they can optimize supply chain performance with minimal human intervention. AI can significantly reduce the risk of human error, and experts say that it is already saving companies loads of time and money, along with impressive investment returns.
- AI has many use cases across supply chains in multiple industries
- You may use it to automate labor-intensive tasks
- You may start with a small-scale implementation, focusing on predictive analytics before moving to a full-scale integration
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The Bottom Line
A quick look at the above trends shows that technology and risk management are crucial for supply chains to continue operating successfully in 2023 and beyond. There is an emphasis on prioritizing operational reliability over pure cost-cutting to achieve targeted business objectives.
If you are looking for a dependable solution to future-proof your supply chain or attain global leadership in cloud delivery management solutions, we offer integrated logistics systems that help you cut down costs and risks and streamline your supply chain processes. At Logos Logistics, our high-tech solutions help you collect, monitor, and validate supply chain data to support your procurement targets and enhance supply chain visibility.
Drop us a line today and find out how we can help!
What is the Difference Between 3PL and 2PL Logistics Services? Home > Blog > Intermodal and import strategies that will improve your supply chain management
Intermodal and Import Strategies that Will Improve Your Supply Chain Management Home > Blog > Intermodal and import strategies that will improve your supply chain
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