The success and increasing growth of the logistics industry pre-dates the unprecedented events of this year. However the COVID-19 pandemic and the subsequent impact on ecommerce and internet sales has only served to fuel a serge in the sector’s growth. 

According to the Office for National Statistics, internet shopping accounted for 26.1% of retail sales in September 2020 compared to 18.1% in September 2019. At its peak it reached 32.8% in May 2020 which was during the first national lockdown.

With these figures in mind, the clear increase in users and conversions to online shopping there is no doubt that 2021 will see some key trends in shipping and supply chain management in order to meet demands. 

In this article we look at the areas where it is predicted we will see some change as a result of this growth and how shipping and logistics can continue to adapt in order to accommodate the growing industry. 

Warehousing and Logistic Centres

With increased demand will come the need for more warehousing space and centres for goods in and out. With faster delivery turnarounds becoming the norm, warehouses will be required to be positioned strategically in order to facilitate last mile deliveries.

The size and quality of warehousing will continue to increase, for example the Group’s current ongoing construction of a new 200,000sq ft warehouse located at Southampton Port demonstrates that the need for continued high – quality warehousing in prime locations is growing and necessary to meet increasing demands. 

Last Mile Deliveries

With sustainability a large focus moving into 2021, it will no doubt be part of last mile planning and improvements. Last mile delivery is the movement of goods, most likely from local distribution hubs to the final destination. According to reports this final link in the chain can account for 50% or more of the total supply chain spend. This is due to the rise in home deliveries, accelerated by national lockdowns this year, which will inevitably highlight inefficiencies. 

Suggestions to improve these inefficiencies include autonomous vehicles, e-bikes and drones and depending on the location a combination of vehicle solutions may be appropriate. For example this summer Amazon announced that they will be rolling out 1,800 electric vans which is part of their overall pledge to be net – zero by 2040. 

Internet of Things (IoT) 

The internet of things refers to the network of physical objects or ‘things’ that are embedded with software to connect and communicate data to one another over the internet. For example the implementation of smart devices in the home to build a ‘smart home’ using technologies that control things such as heating, lighting, security, home entertainment and even shopping. 

This new era of technology will enable the logistics industry to connect people to parcels. The data obtained from IoT will allow logistics companies to track shipments live and also predict trends and maintenance requirements. It will also offer consumers the ability to check each stage of their parcel and prevent theft or delays through address errors or similar. 

As this technology increases we can expect to see even more innovative uses into the next year as businesses seek to find newer more efficient solutions and drive changes to stand out from the competition.

Automation and Artificial Intelligence

The realities of a worldwide pandemic have seen the need for skeleton staff in order to allow for social distancing and to adhere to government guidelines. With this new way of working it has paved the way for increased use of automation and AI technologies. 

Warehouse automation such as pick and place technology increases efficiency and productivity by reducing the need of human intervention. Artificial Intelligence can be used in route planning processes as well as offering predictions and assisting in more efficient warehouse management.

Crisis Management

After the unpredictable year we have had there have at least been some lessons in a more adaptable business model. Moving forward it is expected that the logistics industry will seek to be more flexible in approach in order to cope with spikes in demand or falls due to national or even worldwide crisis. Seasonal variations can be expected to change too as the demand for online shopping increases.

Ways to manage these changes can be through the use of a transport management system which can be highly efficient when used in conjunction with AI. Together these systems can help to forecast risk, change in demand, costs demand, costs and enable the continued ‘on-demand’ service that consumers have come to expect. 

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