The Hyperlocal and Digital Future of Logistics

The Internet of Things (IoT) is transforming nearly all major global industries; transportation and logistics are no exception. The way businesses track assets and transport goods is already being changed by advanced sensors, analytics, smart logistics platforms, connectivity capabilities, and cloud computing. The next wave of disruption in commercial freight is likely to come from automated and electric commercial vehicles, delivery drones and robots, artificial intelligence and machine learning, and blockchain. Guidehouse Insights’s upcoming report, Transport and Logistics Innovations Overview, discusses this in detail.

Moving Toward Fully Automated Deliveries

Guidehouse Insights has mapped the potential use-cases and maturity levels of some these technologies to various elements of the supply chain, as shown in the figure below. These technologies could work in unison to make on-demand, sustainable, and hyperlocal delivery a reality.

Smart Transport and Logistics Technology Applications and Maturity

(Source: Guidehouse Insights)

The red arrows in the figure above demonstrate a potential path forward for how a fully automated supply chain could function—from fulfillment centers all the way through last-mile delivery. The process would involve technologies such as electric and automated robots (warehouse and delivery), forklifts, trucks, and drones. Layers of AI and machine learning can provide added benefits, particularly in the areas of pricing, load matching, asset utilization, and fleet optimization and maintenance. Additionally, blockchain has the potential to reduce complexity and optimize the delivery process by removing intermediaries from logistics operations and supporting a more automated, streamlined, and error-free process. Blockchain can also increase the efficiency of fleets by assisting with vehicle performance tracking and by tackling some of the challenges posed by the electrification of transportation by streamlining billing and settlement processes.

While fully automated deliveries may seem like something only possible in the distant future, in August 2019, Loadsmart and Starsky Robotics announced a successful dispatch of an automated truck to haul freight using AI-powered pricing and load matching technology. The freight was priced, tendered, and booked through Loadsmart, and Starsky’s self-driving truck automatically picked up and delivered the shipment.

Progress Being Made, but Barriers Still to Be Overcome

While logistics technologies are advancing at a strong pace, several key developments will need to take place to enable widespread deployment. The high cost and complexity of implementation, industry and consumer resistance toward new technologies, needed technology improvements to ensure safety, and regulatory development are among the largest barriers in the industry. Suppliers developing advanced logistics technologies will need to focus on proving the reliability, attractiveness, and robustness of their products and services.