By Quinton de Villiers
The rise of predictive networks and technologies will have a far-reaching positive impact on the international transport and logistics sector, and South African third-party logistics (3PL) providers will also have to embrace them as our manufacturers strive to remain competitive in a global economy.
In the past, supply-chain information provided limited value, considering that it was extremely partitioned and disorganised.
It was only once the “blanks” were completed, and the information “de-duped” and sequenced that it provided structured and machine-readable data.
Milestone events and behaviours can now be predicted with high levels of accuracy that were previously impossible, while simulation engines have even enabled the precise calculation of any potential scenarios to determine the most probable outcome.
For example, retailers and manufacturers are using this artificial intelligence (AI) to accurately forecast inland destination shipment arrival times at the time of booking to allow volumes to be efficiently allocated across air and ocean to meet inventory demands.
Meanwhile, retailers are also using it to better forecast partner performance and container movement to improve supply chain and over time to reduce inventory on hand.
These tools are allowing terminal operators to meticulously determine container flows to improve yard optimisation and their partnership to carriers.
This, in turn, has led to improved labour staffing, in addition to on-yard picks and positioning to increase throughput and performance for carriers, motor carriers, 3PLs and shippers, while also allowing them to differentiate their service offering in a competitive industry.
A carrier, on the other hand, can deploy an AI-based platform to collate historical and real-time booking data.
This allows for accurate prediction of booking fall-down and, in so doing, increasing vessel use, customer service and dynamic pricing capabilities, among an array of other benefits.
Using this technology, 3PLs can now merge important insights into customers’ shipping habits and next-generation telematics to provide the best possible on-time delivery – even during peak periods and challenging driving conditions.
Moreover, they can deploy their fleets more effectively to improve capacity and load balance throughout the logistics chain, while also benefiting from better route optimisation, as well as the ability to forecast traffic and accidents.
This ability to confidently and accurately forecast estimated time arrival for door delivery and inland location replaces outdated schedules to estimate future shipment events and, importantly, can be shared with shippers.
Arrival time windows and confidence intervals provide accurate risk metrics, in terms of shipment delays and, therefore, enhance service-level agreements with shippers.
This capability has become an imperative in an era when customers are demanding even shorter delivery times from shippers on the back of ongoing innovation in logistics technology by pioneering companies, such as Amazon.
They are even preparing to harness technologies, such as drones, to make one-day or two-day delivery timeframes possible and, in so doing, drastically changing what is considered to be the norm in the transport and logistics industry.
Not to be overlooked is the strategically important role that these visibility tools also have to play in returns management, an area that has also come under greater scrutiny due to the ability to track transactions and the various phases in the product-manufacturing lifecycle.
However, I view this potential as just the starting point for so much more to come.
Bear in mind the significant opportunity that transporters and logistics providers now have to mine valuable “grassroots” data that can be used by manufacturers and distributors for inventory, merchandising and promotional purposes.
In this digital era, end-user purchases will continue to create a gold-mine of data which logistics providers can use to track demand in the upcoming hours, days, weeks and months.
This valuable information could also be sold to firms to provide a lucrative alternative revenue stream for 3PLs – provided it is collected and reported in a responsible manner that safeguards shippers and consumer confidentiality.
Those 3PLs that are forward looking enough will transcend being merely tactical service providers that carry the boxes and were never interested in what is inside.
Watch this space!
Quinton de Villiers is the founder and managing director of Bridgewater Logistics with a long and impressive track-record in African logistics and security. Follow Quinton at #InTheFastLane for more insights and expert commentary on African transport and logistics.