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Some of the Benefits Of Logistics Automation Includes
Automation Provides A Complete Picture Of Current Rates
Shippers have found automation to be a boon because it allows them to get transparent shipping prices from several logistics companies. The procedure also includes information on the mode of transportation. It makes it much easier for merchants to make logistics decisions. This method aids in the reduction of corporate costs while also providing an estimate of monthly expenses.
Automation Assists in Improving Customer Service
Every piece of information is now recorded in a computer, which can be accessed whenever needed thanks to automation. As a result, there
is less uncertainty about overall logistics management. There are also fewer concerns about human error.
Losing a customer in an e-commerce business is extremely inconvenient for both retailers and transportation companies. Automation not only makes office jobs easier, but it also helps with front-line customer service. Customers are becoming satisfied and regaining trust in e-commerce and logistics as a result of receiving a transparent cost estimate and good service.
Reports Are More Easily Accessible Thanks To Automation
Accessing reports and keeping track of all of the company's data is also easier with automation. During an audit or computation, it also makes it easy to get the facts and figures properly. They also allow these companies to better analyse their growth trajectory and performance. This allows them to concentrate on making the necessary adjustments.
Automation Aids Scalability
Automation has given rise to a slew of useful technologies for the logistics and transportation industries. It has not only allowed many firms to flourish, but it has also lowered the amount of work they have to do on a daily basis.
Even if some organisations are still using old school work procedures, others are combining their current process with the new one, resulting in a semi-automated way. When used correctly, automation has a lot of advantages to offer. They're scalable, and they cut down on human work. Logistics is one of the fastest-growing industries, with plenty of room for expansion with the right automation in place.
Automation Aids in the Proper Integration of Logistics
Along with assisting back-end labour routines, automation also helps with order fulfilment and distribution. They've come to make the logistics industry as a whole more efficient and to lower overall company costs. By automating the supply chain, the logistics director can concentrate on improving the overall process rather than becoming bogged down in one aspect. Solutions like warehouse management systems and robotics can be easily taken care of which will helps to boost productivity and build a stronger platform.
Automation Aids In The Achievement Of Distribution Goals
Logistics supported by automation solutions are able to reach their distribution goals significantly more quickly by integrating various AI-driven technology and cloud-based solutions. Not only that, but they've been able to expand their reach and deliver happiness to people all around the world.
Challenges in Logistical Automation Include
The potential of automation intrigues logistics organizations, but they should be mindful of the hazards of automation as well. As a result, they are investing cautiously. Though consumers of logistics companies and automation in retail, automotive and medicines is increasing rapidly, investment in logistics automation is expected to grow at the slowest rate in logistics, at around 3% to 5% per year through 2028.
Logistics automation is being held back by five challenges. The forces (e-commerce and technology advancement) that are pushing the growing interest in automation have two opposing aspects. Purchasing issues, the possibility for change in the omnichannel supply chain, and the risks connected with short-term contracts are all clouding the picture.
Competition In Capturing E-Commerce Clients
Any logistics company that wants to take advantage of the massive e-commerce growth opportunity must meet two basic requirements: speed and diversity. For instance, in same-day shipping on any of a million SKUs, more automation in picking, packing, and sorting appears to be an obvious investment decision to cope with this. However, many logistics companies are held back by the peculiar relationships that exist between logistics providers and e-commerce customers. The danger can appear in a variety of ways. E-commerce businesses have higher purchasing power; they can easily switch to a competitor if they don't like a logistics company's offer. This tends to keep prices low, and it may prevent logistics companies from getting a good return on a large automation investment.
Another complication is that most significant e-commerce companies, like as Amazon and JD.com, have developed their own logistical infrastructure. In fact, if Amazon's logistics division were spun out, it would be the world's fifth-largest third-party logistics provider. Working with these companies can, without a doubt, be difficult for shippers. With their superior data and massive scale, the online behemoths may easily offer white-label products that undercut their shipping customers' offerings.
Serving e-commerce enterprises presents a unique problem in that demand is extremely erratic, easily doubling during Christmas or Singles' Day. Alibaba's logistics arm, Cainiao, processed 812 million orders on Singles' Day 2017, eight times higher than on a regular day. For three-quarters of the year, logistics companies will need significant spare capacity to meet customer expectations during peak periods. E-commerce behemoths will have even more incentive to build their own capabilities if they do not construct enough capacity for peaks, like Amazon did following the 2013 Christmas season.
Technology Is Advancing at Breakneck Speed
Technologies for logistics automation are available aplenty but these technologies are advancing at such a speed that some are becoming obsolete as soon as they are marketed. No one wants to invest in technology that will become obsolete soon after purchase. Not only would this make a company less efficient than competitors who made better decisions, but it would also put it at a disadvantage against competitors who made no investment at all. The cost of removing and replacing equipment, much of which has not yet depreciated, would sink unlucky investors.
Purchasing Difficulties
Even if a logistics company buys the best automation equipment available, it may run across another issue. the biggest warehouse-automation manufacturers have had substantial sales growth of 15 to 20% each year. Many order books are now completely full. Vanderlande Industries' order book hit an all-time high in 2017. Part of the issue is that the manufacturers are still working at a small scale. Many businesses, including industry leaders, are narrowly focused on a few technologies and solutions. That could change: the industry is in turmoil, with a lot of mergers and acquisitions going on. Large technology corporations, in particular, are investing in automation start-ups.
Distribution Networks of Shippers Are Rapidly Changing
Part of how brick-and-mortar businesses are responding to the e-commerce onslaught is by transforming their distribution networks into omnichannel systems, which allow customers to buy and receive things via any channel. They could shop online and have their purchases delivered to their homes, as is the traditional e-commerce strategy. They may increasingly order online and pick up in stores. Alternatively, people might shop in-store and have their orders delivered to their homes, as menswear firm Bonobos and others do. They can still go to the store and leave with their items, of course. Furthermore, customers are demanding speedier delivery, which necessitates more local storage capacity, adding to the complexity. It's difficult to build a supply chain that can support an omnichannel system.
