4 Supply Chain and Logistics Technology Trends in 2021

4 Supply Chain and Logistics Technology Trends in 2021

supply chain trends2020 was probably the toughest year for every industry and individual. The global COVID-19 pandemic brought in an unprecedented wave of disruption. One of the worst affected was the supply chain and logistics sector. 

Despite the challenges, however, the industry managed to sustain growth. Data shows that the global supply chain management market is expected to grow from $23.2 billion in 2020 to $41.7 billion by 2026, at a CAGR of 10.3%.

Technology helped the global supply chain and logistic industry to keep up with the rapidly changing consumer behavior. The sudden surge in online shopping was a wake-up call for many, even for industrial hardware suppliers. It fueled the rapid adoption of technology in the first half of 2021, which is likely to endure in the coming months. 

Here are a few supply chain and logistics technology trends you can’t miss in 2021.

Artificial Intelligence 

Artificial Intelligence or AI has already brought about many changes in the logistics and supply chain industry. It has played a particularly critical role in increasing visibility across all aspects of supply chain management. The end goal of AI has always been to reduce the margin of error in supply chain management. To that end, AI has improved the following aspects of supply chain and logistics.

  • Improved speed of decisions making and upgradation.
  • Reduced operations costs.
  • Enhanced worker and material safety.
  • Increased warehouse efficiency by simplifying complex procedures.¬†
  • Ensured on-time delivery through real-time tracking.¬†

The good news is, as technology becomes cheaper, AI can be used by medium and small-sized logistic companies as well. As an industrial hardware supplier, you can also enjoy the benefits of AI, whether it is predictive analytics or inventory management automation.

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Autonomous Vehicles 

Although it will be a few more years until autonomous vehicles become part of an intelligent supply chain, this technology is gathering investment momentum. From small startups to logistics and tech giants, everyone seems to be interested in autonomous vehicle technology.

Companies around the globe are testing autonomous trucks for faster delivery of goods. For a logistics company, a fleet of autonomous vehicles promises to deliver several benefits, including the following. 

  • Autonomous vehicles require no human involvement. As a result, companies can save significant costs linked to labor, insurance, and accident liabilities.¬†¬†
  • Autonomous vehicles would also be energy efficient. They can cut the overall shipping and fuel costs quite a bit.
  • ¬†The technology will also help companies overcome driver shortages and high turnover. According to ATA, the driver turnover rate for long-haul trucking was 90% in the fall of 2020. Autonomous vehicles can address this issue as there is no need for human drivers.

Autonomous vehicles will take supply chain automation to a whole new level. It might lead to a truly intelligent supply chain that responds to market changes in real-time. However, this technology is still in its infancy. For now, the focus is on developing fully autonomous vehicles.  

Warehouse Automation 

Warehouse Automation  supply chain 2021Warehouse automation is likely to become more prevalent in the coming years. In fact, the current COVID-19 pandemic has accelerated the use of automation in warehousing. The warehouse automation market is likely to touch the mark of $30 billion by 2026 at a CAGR of almost 14% between 2020 and 2026.

Rapid changes in the warehousing industry, such as increasing labor costs and labor shortages, are pushing for automation. Other factors influencing this growing trend include demand for higher throughput, costs savings, and improved scalability. 

Whether it is an industrial hardware supplier or a retail store, many companies are already using some form of automation in warehousing. For example, Automated Storage and Retrieval Systems (AS/RS) are already being used for high-volume warehousing operations. These systems use a combination of shuttle, mini loaders, and robots to improve warehousing efficiency and worker safety. 

Similarly, companies are using Automatic Guided Vehicles (AGVs) to move material within warehouses. AGVs run along pre-defined paths using sensors and magnetic strips, among other things.

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supply chain blockchainBlockchain technology can transform the visibility and profitability of supply chains. Several companies have already started testing the potential applications of Blockchain. 

A few years ago, retail giant Walmart worked with IBM to create a food safety blockchain solution. It uses Hyperledger Fabric, an open-source ledger technology, to make the decentralized food supply chain more transparent.

Other potential applications of Blockchain include:

  • Faster and transparent financial transactions as Blockchain transactions require no intermediary like banks.
  • Increased real-time visibility in supply chain management, which can improve efficiency and cut losses.¬†¬†
  • Reduced risk of fraud or failure as Blockchain uses distributed ledger system. All blockchain transactions are irreversible and immutable.¬†¬†
  • All parties in a supply chain can get access to the same information without delay. Moreover, no one can delete or conceal any information from the Blockchain owing to its distributed nature. This will reduce errors and speed up communication.

Parting Words 

Like every other industry, technology has taken the front seat in the supply chain and logistics industry. Different technologies are being used or experimented with to improve visibility, cut costs, and speed up delivery. Knowing about the latest supply chain and logistics technology trends can help you stay ahead of the curve. What you think of these four tech trends gaining traction in 2021? Will they go beyond 2021? Tell us in the comments.

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Author Bio

I am Randy Gonzales. I am the President of Elite Sales Inc, a rigging equipment and wire rope distribution company based in Miami, Tampa, Houston, and Dyer. I have more than 30 years of experience in the distribution and supply of the industrial hardware industry.

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