10 Things That Will Change in Logistics in the Near Future

10 Things That Will Change in Logistics in the Near Future
Metallica was playing at Helsinki, Finland on the 9th of June.

I had the privilege to see Metallica live in Helsinki, Finland, and play the song Battery.

"Lashing out the action, returning the reaction
Weak are ripped and torn away
Hypnotizing power, crushing all that cower
battery is here to stay"

This inspired me to write this article. By the way, Metallica is touring Europe with 97 semi-trucks that are fueled with liquid gas or electricity.

10. Energy surcharge

I don't think the term "fuel surcharge" will be used in five years.
We won't be following indexes based on oil market prices or the average price of diesel.

By optimizing different energy forms, transports can be delivered emission-free and cost-effectively. This will result in having the surcharge based on an added energy surcharge.

My hunch is that all extra surcharges will become history and there will be a better model as a replacement.

9. Microhubs & shared terminals

The future is loaded with teamwork and building electric infrastructure is expensive.

Most likely a feeder truck brings the goods to a shared terminal.
From here we will see mobile delivery robots, drones, mobile parcel lockers, community-based delivery companies, and more different types of small electric vehicles doing the last mile delivery.

8. Social responsibility

Occupational health and safety metrics are standardized and comparable across all companies.

It's not enough for companies to have auditing standards in place or a code of conduct in use. Companies will set baselines and development goals for everyone to see.

Companies that use subcontractors must be able to monitor the activities of their partners and demonstrate that working conditions are met and that workers are paid sufficiently.

This can be a competitive advantage when employees are looking for a new employer.

7. Human lakes

Once everyone was talking about data lakes and the need to make it easily accessible.

I see that organizational models and roles will change within the next five years. Currently, changes and regulations in logistics create silos in companies.

In the future, ownership and new goals would be implemented across multiple units, meaning that information and responsibilities would be distributed throughout the organization.

6. Diverse fleet

A diverse fleet of vehicles is advantageous for both customers who order transportation and transportation companies. It ensures that the right vehicles are available for the right tasks.

For example, local deliveries can be made with electric vehicles, and longer, standard routes can be made with liquid gas vehicles. If the after-mentioned alternatives cannot be utilized, a partnership is formed with a company that can provide suitable vehicles. Because the companies using a diverse fleet will be more cost-effective and future-proof.

5. Customer lifetime value

Customer-centric operations will become increasingly important across the entire organization. Here are two metrics that will become familiar to everyone:

CLV (Customer Lifetime Value) and LTV, which looks at the average value of all customers for the company.

Why? Companies will understand and identify their most valuable customers. This will enable streamlining operations and improve their profitability.

4. IT and Systems

IT costs for businesses are constantly rising, and there is no end in sight to this trend. The winner in this race will be the company that enables easy integrations with its systems and can experiment with the best solutions quickly.

3. Artificial intelligence

Just to name a few use cases...

  • Dynamic pricing
  • Dynamic route optimization:
  • Quality assurance
  • Packing
  • Supply chain optimization
  • Automated picking
  • Systems maintenance
  • Predictive maintenance
  • Emissions reduction and reporting

    2. Partnerships

    I could easily write an entire newsletter based on the dozens of great examples I've witnessed. Companies will increasingly demand that their partners provide a road map for reducing emissions. This will lead to a more holistic view of their partner's goals.

    Partners will be chosen based on their alignment with the company's future direction. This will lead to higher margins for logistics.

    It makes sense for a transport entrepreneur to invest in electric or bio-gas vehicles if they can build long-term partnerships through them.

    Electricity especially is changing the commercial interfaces of the industry. You can have the customer and the shipping company do a mutual investment for the charging stations.

    The use of renewable energy and the mounting sustainability goals will change the way freight services are sold.

    1. Emissions

    Customers want to have a precise knowledge of their emissions based on verified data, regardless of whether it's a package, a pallet, or a pair of shoes.

    Decision-making will emphasize the ability to deliver the most accurate data possible - the era of averages will be over.

    Businesses are starting to consider how much their CO2 tons cost is compared to performance. Companies are already aware of the financial implications of emissions optimization and are already leveraging it to develop partnerships.

Great! You’ve successfully signed up.

Welcome back! You've successfully signed in.

You've successfully subscribed to FreightCaviar.

Success! Check your email for magic link to sign-in.

Success! Your billing info has been updated.

Your billing was not updated.