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Are you confused about the ‘digitisation’ of modern logistics?

01 February 2017

You may have heard a lot recently about the ‘digitisation’ of modern logistics; a new buzzword that’s been cropping up everywhere. But, what does it actually mean?

In short, it’s all about digital in everything. It can extend to disruptive technologies like robotics, drones and 3D printing, but primarily for logistics, it’s about using technology to improve end-to-end supply chain effectiveness, control and visibility. While some of these technologies might seem a long way off, the one to take note of now is the growing provenance of track and trace. The implementation of track and trace is a huge part of the technology or ‘digitisation’ of modern logistics, and it’s something brands need to be focusing on now.

If you’re not up to date with the latest goings on with track and trace, not to worry. Here’s a quick 1-0-1 on everything you need to know…

What is track and trace?

Track and trace gives you the ability to monitor the events occurring through your supply chain, in real time.

As you come to deal with the increasing demand for more efficient and speedier deliveries, and consequently, better customer experience, you will soon realise that while delays and errors are inevitable in the world of logistics, they can no longer be treated with the same leniency. Instead, you need to know when and where things go wrong so you can step in and make a quick fix.

  • Track is a term given to the status of your goods at any given time.
  • Trace gives you every bit of information about this item – where it has been, which touch-points it’s gone through and where it’s going. 

What are the practical advantages of track and trace?

Track and trace gives you full visibility over all your supply chain members. It offers the ability to monitor the entire sales journey, up until the point of delivery to the customer. For instance, when a carrier makes their first scan, you will receive notification that the event has occurred.

In having the ability to have a ‘bird’s eye view’ over your entire supply chain, you can obtain quantifiable metrics about your own efficiencies. In turn, it gives you the opportunity to reduce business and supply chain risk, by identifying inefficiencies and quality problems; while also improving lead times and performance.

How does it do that?

The technology effectively empowers you to make decisions on behalf of your customers; allowing you to circumvent issues and delays, as they happen, and continuously problem-solve for maximum efficiency. These efficiencies will also have an amazing impact on your overall operational costs too.

For industries like food or drink, hazardous goods, medical devices or anything highly regulated, the advantages an efficient track and trace system can be even more critical. Particularly when you need to track the life cycle of a product, end of life or even the journey going in and out of the warehouse. The ability to know where products are at any given time can help from the order process right through to picking and returns; driving up efficiencies and reducing errors.

Put simply, the automation of tracking unique product numbers, absent of human intervention, means tighter synchronisation of all data, but also the ability to prevent or spot errors earlier. This means you are less likely to ship the wrong item, miss when the wrong item has been returned and put products away incorrectly. This is just one example, as the applications and benefits of such technologies (which are changing all the time) are potentially endless.

What other value can it bring?

If you find you can’t deliver your products when and where your customers expect them, their customer experience deteriorates significantly. Track and trace however helps you improve this area of your sales journey and bringing enormous value directly affecting your customers’ satisfaction. If you keep your promises, your customers will trust you and that means they’re likely to buy from you again. Sounds simple, and it is in principle; however the application can sometimes be tricky.

What are the highs and lows?

The thing to note is that in today’s omni-channel world, inventory management can no longer be delivered without granular track and trace technology; and that’s the truth of the matter. It’s no longer a ‘nice to have’.

This means considerable investment need to be made by brands – both financially and in terms of time. Expertise is also needed for the application of such technologies and when re-thinking a brand’s entire business model, which now need to be more focused on the role of logistics within the customer journey. An approach like this will ensure the right technologies are adopted and also maximise the opportunity for improvements in the supply chain, ensuring optimal performance.

For logistics providers, they too need to be re-thinking their business models to give them more access to the process chain and add more value to clients. Without investing in technology of this kind, they will provide little value to brands in this modern omni-channel world. As the experts, they need to enhance in-house solutions via a managed software options; it really is a make or break situation.

What does the future hold?

Currently, most track and trace systems work by utilising static scan and or digital barcode technologies, capturing historical data of the last milestone. However, with the continued development in GPS signal technology there is now more and more opportunity to monitor consignments from the warehouse right through to delivery.

Yet, it doesn’t end there. Soon, we can expect to see a wider use of devices which can not only track, but also monitor for things like the temperature of a parcel. RFID technology for instance (already used widely by supermarkets for high value items) offers the ability to track a product at any point and even gives the ability to pinpoint a parcel or product to a specific warehouse location!

In conclusion

With an uncertain economy up ahead, a growing number of providers available - and incidentally more vans and lorries on the road – some argue that we’re nearly at capacity in turns of delivery traffic and consignments. Without contingency plans, by both brands and providers, there could be fierce competition and potentially a drop in standards of service which is bad news for customers, especially when their expectations are at an all-time high.

For those doing track and trace well, they will reap the benefits of better visibility and efficiency, reduced costs and increase customer satisfaction.

To find out more about how our Powerful Technology is helping companies differentiate and enhance their logistics solution, then please click here. Or drop us a line to discuss your requirements in more detail.