Supply Chain Trends for 2018

The world is changing and fast, with the Internet of Things (IoT), Artificial Intelligence (AI) and Blockchain all leading the way. These exciting developments are already having an impact on supply chains and this will only increase with time.

As customers needs change what trends will disrupt the supply chain in 2018?

 

Increasing Demand

Amazon the retail giant are a perfect example of supply chain innovation with them processing over 400 orders per second during peak times. This is not by chance as Amazon have invested heavily in their supply chain technology over the last few years allowing them to take control of the online retail space. In 2014 they introduced same day delivery which many thought could never work (how wrong they were).

This success has led to consumers demanding faster and more streamlined services. In 2018 JOH Partners expect that this consumer demand will spread to other industries such as the automotive and industrial manufacturing sectors. Innovation in the supply chain will be key to staying relevant in 2018.

 

Data-Driven Logistics

A Capgemini Consulting survey found that 98% of 3PLs said that improving, data-driven decision making is 'essential to the future success of supply chain activities and processes'. Additionally, 81% of shippers and 86% of SPLs surveyed said that using big data effectively is fast becoming a core competency of their supply chain organisation.

Supply Chain Management Review predict that in 2018 companies will begin to utilise geography specific data to anticipate the demand for a region, allowing them to ship in advance.

A Label Insight study suggested that 94% of consumers will stay loyal to a brand that is transparent meaning that data-driven logistics will play a key role in aiding communication along the supply chain. 

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IoT Device

By 2020 Gartner believe that the number of connected devices to the IoT will have more than tripled, suggesting that there could be as many as 20.8 billion globally. This will lead to massive revenue opportunities in supply chain operating efficiencies.

In 2018 IoT devices can be used to improve vendor relations with communication happening in real-time and the improved communication will also make tracking assets considerably easier as IoT sensors can provide much more accurate inventories than a human can. 

 

Increased Use Of Robot Delivery

In 2018 we will see delivery robots becoming more involved in last mile deliveries. With concerns over public safety regarding drone we have seen a more focus given to land-based robot delivery systems powered by AI software.

Many organisations are now investing huge amounts of money into the development of robot delivery systems in an attempt to save costs in the long run. A study conducted by ARK Investing Group predicted that drone delivery would cost Amazon less than $1 per shipment, while they currently spend approximately $5.75 on shipping per package.

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Renewed Focus on Sustainability

As many logistics providers are asset-based their need to think about sustainability will play a key role in 2018 for example when purchasing transportation. P&G, the world's leading provider of consumer goods, recently stated on their website that they aim to have 'zero manufacturing waste to landfill'. In 2017, UPS announced they would add additional compressed natural gas (CNG) fueling stations and add 390 new CNG tractors and terminal trucks and 50 liquefied natural gas (LNG) vehicles to its alternative fuel and advanced technology fleet which has more than 4,400 vehicles.

A study by Nielson found that 66% of respondents would pay more for a product or a service if the company was committed to positive social and environmental change.

Consumer power will push more companies to make their supply chains green this year.

 

Contact JOH Partners today to discuss further your companies supply chain talent need.

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