“The latest time to enter digitization is now.” This is the conclusion of a study by Prof. Wolfgang Kersten on the digitization of logistics.
Innovations are essential for every industry. In order to remain competitive, companies need to utilize innovation and optimize their delivery processes with regard to logistics. Digitization plays the main role here as an innovation driver. But digitizing processes is easier said than done. Regarding digitization, logistics is still in its early stages.
Especially traditional companies that have been successful for decades often have difficulties. This impact is even more noticeable with carriers. According to a study by InstaFreight in cooperation with Herzig, only ⅔ of carriers have already implemented digital projects. The study also showed that shippers demand digital processes and Track & Trace as well as an Estimated Time of Arrival (ETA).
Many traditional companies find it difficult to implement these requirements. It is possible to pass an ETA in a small number, but with 100 shipments a day, telephone and mail traffic cannot scale. Digitalization has changed from a “Nice to have” to a precondition. In order to adapt to these conditions and create competitive advantages, companies are forced to transform themselves.
An example from practice:
Logistics for bottling companies and breweries brings along many challenges. Beer has to be transported carefully to avoid spoilage. Retailers must be able to return expired bottles to ensure freshness. With today’s technology, logistics service providers can help companies carry out such sensitive activities faster, more efficiently and without high costs.
In order for the industry to work more efficiently, existing issues need to be addressed. Digital solutions enable shippers, forwarders and carriers to solve some of the industry’s current problems and gain benefits:
- Coordination tasks are improved: Digital freight forwarders make it possible to bundle supply and demand in the market. For example, shippers who require high delivery capacities are able to book them with a digital freight forwarder. InstaFreight, for example, consolidates the transport capacity of thousands of carriers and can thus provide shippers with sufficient capacity.
- Inefficient communication is eliminated: Even today, many freight forwarders work with mail and fax machines. As a result, the time and money which is needed to arrange capacities and set prices. Traditional forwarding companies need several days for this, a price algorithm calculates prices in milliseconds. Digitization can also simplify communication before, during and after transportation. Digital and automated pushed status updates lead to more transparency along the supply chain and enormous time savings.
- A lack of transparency can be managed: As the demand rises, traditional freight forwarders tend to lack transparency. Digital forwarding companies can constantly improve vulnerabilities by expanding consolidation and preparing data, especially with Track & Trace.
It may seem as if disruptive digital companies are driving traditional freight forwarders out of the market. But this is not true. The core competency of logistics startups is to build digital processes. Startups can thus help traditional companies to digitize their processes. Because the market is so fragmented, digital freight forwarders bundle thousands of carriers carriers.
The interaction of logistics and digitization creates synergy effects that ultimately benefit all parties – especially the customer.
“We win customers by offering simple solutions to complex problems. We enable today’s carriers to meet the needs of tomorrow’s customers. We scale through digital innovation.” This is our mission at InstaFreight.
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