While logistics companies across the U.S. are always on the lookout for ways they can improve their operations and get a greater return on investment out of every dollar, the good news is that evolving technology gives them plenty of opportunities to get ahead. However, that means executives have to consistently monitor industry changes and evaluate their own readiness for evolution.
While many logistics firms face uncertainty these days – thanks in large part to just how quickly things in the field are changing – there are also plenty of positives for the industry as a whole, according to the 28th annual State of Logistics report from Logistics Management. Last year, logistics costs fell nationwide despite widespread participation, which can be seen as a positive for many firms, but at the same time as more companies come into the sector, profit margins are thinning out. As such, companies need to start looking to how they can stand out in the industry.
“[I]ndustries are churning with disruption, as newcomers and incumbents vie for market share and innovation undermines old business models,” the report noted. “One thing is certain: ‘business as usual’ won’t return. Against that uncertain backdrop, logistics executives must make vital decisions about capacity, pricing, technology deployment and strategy.”
Identifying potential hiccups
When these issues arise, it’s worth noting that the many improvements to the industry over the past few years can be a big help, but they also bring with them new challenges, such as the potential for hurdles related to the shipping process, Logistics Management further noted. This is reflected in recent data from the American Trucking Association, which showed that while the tonnage being shipped nationwide was up 4.8 percent on an annual basis, it had also fallen on a monthly basis in each month since February.
Because of the way in which e-commerce has come to dominate the logistics field, it’s now consumer preferences that seem to drive industry spending, more so than other, more traditional factors, such as fuel costs, the report said. This is where evolution and any given company’s ability to adapt becomes crucial: Finding new ways to maximize the effectiveness of shipping plans and other aspects of the supply chain will be crucial to ongoing business success.
An issue of preparedness
Furthermore, it’s vital that companies make sure they’re not only prepared for the operational needs of tomorrow in terms of supply chain planning and infrastructure, but also that their employees know how to adapt to those needs, according to a separate Logistics Management report. They must also ensure that their workers are equipped with both the tools – such as devices that speed up mobile data collection – and, more importantly, the training to help businesses achieve their ever-evolving goals.
The more companies can do to make sure everyone is onboard with their planning efforts, with the knowledge of exactly what is expected of them and how best to achieve their goals, the better off all involved will be as time goes on and the industry continues to change.