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Sensors Provide a Competitive Advantage
Smart sensors are helping to improve supply chain management by providing leaders with real-time data about raw materials, production processes, inventory levels and distribution. As part of the distribution portion, logistics are coming under scrutiny because of the tremendous impact this has on both profitability and repeat sales.
Supply chain leaders are revisiting their logistics strategies to provide an acceptable customer experience. What used to be considered “exceptional”, is now becoming Standard Operating Procedure and this is stressing out a lot of supply chain specialists.
Strategically- used smart sensors are being used to address these concerns, and the trends noted below.
2021: Building on 2020 Trends
#1 Faster Fulfilment and Increased “On-Demand Delivery”
According to a recent study, 80% of millennials and 50% of businesses are willing to pay additional fees for same-day delivery (100% in an urgent situation). But even if they’re willing to pay, that doesn’t help with the bottlenecks. To accommodate faster turnaround times, many manufacturers and purveyors of goods are using micro-hubs, often sharing smaller cross-docking facilities, which requires more robust tracking. RFID tags, sensors and smart dust can make it easier to keep track of what inventory is where at any given time.
The reduced fulfilment times also mean warehouse staff have significantly less time to pick, pack and put an item on a truck. Cameras and sensors can automate much of the process, helping to reduce errors and expanding employee overhead.
#2 Increased Demand for End-to-End Transparency
Customers want to know where their packages at any given time – and so do the shippers. Unfortunately, many logistics firms/transportation companies are reliant on legacy supply chain architectures with poor systems interoperability. When client order management and 3PL systems don’t synch up properly, it can be almost impossible to track where a delivery vehicle and its packages are at any given time.
It also impedes a logistics manager’s ability to properly assess costs because this lack of visibility can result in extra fuel consumption because of poor routing and other delays.
Again, sensors can an efficient and cost-effective solution.
#3 Dynamic Routing
Dynamic routing helps logistics specialist track their fleet in real time. By connecting with traffic apps, routes can be optimized in real time based on congestion and weather. For clients wanting to offer their customers the option to choose their delivery time, or have the flexibility to change location as needed, these tools are essential.
These programs, which make use of sensors and/or cameras, can also be used to track drivers. Instant notifications can be sent when a driver has stopped, or the vehicles idling, for too long – potentially signalling a problem with the driver. If the driver doesn’t respond within a specific time following the company check in prompted by the alert, emergency aid can be dispatched.
Whether you refer to them as Gig Drivers, Crowd-Sourced Drivers or Part-timers, it’s the same thing. To keep up with the increased demand, many 3PL companies hire drivers on a temporary basis. Some drivers rent trucks by the day for this purpose. The challenge? Ensuring these “gypsies” are equipped with mobile devices that will communicate securely with the main network – and that company processes will be observed. There are several technology solutions that help make this possible. Logistics specialists are now involving outside tech partners to help them make decisions that will work in the short-term, and still represent a good investment for the long haul.
There are several technology solutions that help make this possible. Logistics specialists are now involving outside tech partners to help them make decisions that will work in the short-term, and still represent a good investment for the long haul.
#5 Adoption of Electronic Proof of Delivery (ePoD)
EPoD, which allows people to sign receipts with various mobile apps, is being embraced by more and more carriers. This technology can enable data to be stored simply, making auditing processes easier – and when coupled with sensors on products and/or packaging, manual errors are greatly reduced.
#6 Smart Sensors Save Spoilage
As dependence on the last mile increases, clients are using sensors to monitor temperature, humidity and leaks when perishable items are being shipped. For longer haul trips, temperature -controlled trucks, with deliveries being offloaded into environmentally-controlled warehouses, are still the gold standard, but for the shortfall/last mile, proper use of sensors, tied into a robust network, can reduce spoilage-related costs by 40% or more
#7 Logistics Data Being Used to Drive Sales
Retailers have been using data to predict what customers might want, even before they order a particular item. Building on the monthly subscription delivery model introduced in the 1950s, a new business model is evolving where items company or individual orders regularly are delivered and build automatically. Interestingly, less than 20% of customers refuse these items.
This is giving rise to another new approach: The Mobile Warehouse. Inventory that has not yet been committed to a customer will be included in a delivery truck, so that the driver can upsell customer when the package is delivered. This requires good integration of package and driver tracking. Cameras can also be used to help keep track of transactions.
#8 Autonomous Vehicle and Drone Delivery
Retailers have been experimenting with drone delivery for a few years now – in some university campuses are using autonomous vehicles to deliver food. Logistics specialists know that people are the biggest causes of delivery errors and delay, so automating this part of the process seems like a logical extension – though I wouldn’t be adapting my systems too much, just yet.
It’s clear that smart sensors have the ability to respond to the above challenges, provide end-to-end visibility into companies’ suppliers, distributors, and customers, reduce errors, lower overhead costs and improve business efficiencies and outcomes overall. So, it’s no wonder that experts often say that sensors create a “digital last mile” solution for supply chain and logistics specialists.
If you’d like to learn how sensors can be used to improve your operations, please feel free to contact us at [email protected] or (416) 429-0796 or 1.877.238.9944 (Toll Free), even if you’re only looking for a knowledgeable shoulder on which to bounce some ideas.