Freight Forwarders – key technology trends to watch out for and prepare for 2023
From the continued effects of the COVID-19 pandemic to the Suez Canal obstruction and the war in Ukraine, the freight forwarding and logistics industry faced unprecedented disruptions in the past three years.
According to a report by International Monetary Fund (IMF), the geopolitical conditions and the rising inflation in 2023 expect to bring down the economic growth from 6.0% in 2021 to 3.2% in 2022 and 2.7% in 2023.
By now, it is clear that the effect of the last few years' disruptions can expect to ripple into 2023, and this year will be no different and bring its opportunities and challenges.
Freight forwarders need to ensure they are resilient and prepared is the key to surviving and thriving under any circumstances.
So before we move into the New Year, understanding and gauging the unexpected situations as expected is the first step in preparing yourself to sail through your freight business with flying colors in 2023.
According to a McKinsey survey, since 2021, 90% of logistics service providers agreed to invest in technology is the key to survival, with 80% expecting to continue investing in 2023 and beyond. Digitalization bringing agility, flexibility, and visibility are the key mantra to ride through any storm.
So what best time other than the New Year to ponder on some key technology trends and prepare strategies for 2023?
Cloud-based systems – Cloud is the disruption that the world of freight and logistics has happily welcomed to keep pace with the dynamic demands of the industry. Cloud has helped integrate all aspects of the supply chain with real-time visibility, automate internal processes and enable better business decisions to make the business more resilient and agile. Communication also improves by cloud-based systems as it facilitates field staff to communicate on the go using a mobile app. The widespread adoption of cloud-based freight forwarding software will continue to enable the industry to accomplish commercial goals, reduce costs, improve operational efficiency, and give value-added solutions to their customers in 2023 as well.
Artificial Intelligence – According to research by Mckinsey, estimates that logistics companies will generate $1.3-$2 trillion per year for the next 20 years in economic value by adopting AI into their processes. The development of AI has revolutionized and bought the most significant advancements in the logistics industry. This powerful technology offers to automate and simplify numerous processes. The industry started seeing the value of machine learning and the advantages of using artificial intelligence to improve production and delivery. It's no surprise that tech giants like Google, Amazon, and Tesla are exploring more and more AI in their operations.
Blockchain - Initially designed for the financial space, Blockchain has emerged as a powerful trend for multiple stakeholders in the supply chain. The technology is driving innovations in the freight forwarding and logistics industry and has the potential to boost transparency, reduce risk, drive productivity and improve the overall operational processes. This technology allows for smooth peer-to-peer communications, data exchange, and execution of transactions with increased transparency and complete security. The freight forwarding and logistics industry is a highly complex industry with diverse stakeholders, varying interests, and many third-party intermediaries blockchain technology can be a game changer.
The global blockchain technology market expects to be around USD 1,593.8 billion by 2030, poised to grow at a compound annual growth rate (CAGR) of 87.1% during the forecast period 2022 to 2030.
Internet of Things and Autonomous Vehicles – The implication of autonomous vehicles are far-reaching in the freight and logistics industry. The implementation of autonomous vehicles into delivery services has the ability to greatly impact the industry through cost savings, reductions in transport time, safety, and more. It can make logistics more sustainable, more secure, and more efficient. Autonomous vehicles expect to disrupt the freight and logistics industry processes, and operating costs, and deeply impact the relationship between service providers and customers in 2023 and beyond.
Applications of IoT in the logistics industry are now emerging at an unprecedented rate allowing the integration of various assets within the supply chain and the subsequent analysis of the data generated by these connections. By using IoT technology businesses can develop data and process it to create useful insights to increase visibility, more collaboration, better customer service & real-time tracking of goods. The trends to use IoT in the freight and logistics industry will continue as a new pillar to boost efficiency and increase productivity.
As we look into 2023, we can anticipate technologies will continue to reign the freight industry shift from reactive to proactive and from survival mode to growth mode.
As we move into the New Year, a key takeaway is to shift to a conventional mindset for developing solid freight and logistics strategies that align with the current dynamic landscape and customer demand, as key players adapt to the unending changes in the industry.