Logistics is the process of moving assets or resources from the level of production to the point of usage. Technology and creativity are essential to the future of logistics and distribution. Significant developments in the transportation sector are eagerly awaited by customers. The transportation industry needs to halt operations due to the severe weather, or consumers will be forced to pursue alternative transportation. The transportation and logistics industry is a simple business to start, but maintaining and growing it is the challenge (Chen et al., 2020). At the bottom of the market, the transportation industry has a low entry barrier, which means that anybody with a truck or trailer will start providing transportation services. As a result, there is a flurry of rivalry at the low end of the market. When products are imported or exported within a country, various logistics solutions emerge, ranging from new start-ups to seasoned and experienced operations. Small businesses are often left out of lucrative deals by large corporations.
The transportation and logistics industries are the backbone of every economy and the main driver behind all industries, including agriculture, manufacturing, and services. However, it is currently undergoing significant change, as is the case for all sectors, as a result of technological advancements, changing consumer tastes, and strict regulations. Experts in the field of transportation are highly concerned about the rate at which technology advances. As if it were a disease, technology has taken over. As a result, numerous logistics companies have struggled to keep up with technological advancements (Glistau & Machado, 2019). As digital transformation and innovation become increasingly important parts of many businesses’ overall strategy, a lot needs to change. In this article, key issues in transportation and logistics management will be discussed, including stock error, government regulation, human resource management, customer support, coordination, business operations, and technology.
The Challenges that Logistic Companies Face
Having a Great Deal on Transportation
Since transportation accounts for total expenditures, they are having a good deal on transportation is the single most important challenge for the industry. However, with rising inflation, this could increase to 50% of the budget (Witkowski, 2017). Companies will redistribute their services to fewer competitors and negotiate lower prices by doing so. However, this raises the risk of being too dependent on a limited number of carriers. Freight carriers may use fleet management routing tools to ensure that they follow the most effective routes possible, avoiding traffic jams and taking into account road limitations depending on vehicle type and time of day. This eliminates not only overall miles traveled, wear and tear, and repair costs but also breaches and safety risks, potentially lowering insurance costs.
Fuel price increases lead to wage increases, which raise transportation costs daily. As a result, logistics firms would need to devise a well-thought-out strategy to avoid or at the very least reduce transportation costs. Logistics companies need accurate information centered on current and potential orders to execute such techniques. Using a cost-effective third-party logistics agency is a successful option for local businesses looking to cut transportation costs (Jagtap et al., 2021). This will assist small logistics businesses in avoiding the costs of vehicle repairs for delivery purposes. The rest can be handled with a small fee charged to a third party.
Coordination is Ineffective
The logistics industry’s main challenges stem from its uncertainty and fragmentation. It is challenging to have centralized control over every phase of the process because there are so many interested parties (manufacturers, store clerks, drivers, administrators, and end-users). A technological solution that synchronizes information between different parties may be the silver bullet. The technology discussed about should include position and activity monitoring, asset tracking, and a messaging network. The issue of empty mileage is critical from truck drivers’ viewpoint (Ul-Hameed et al., 2019). The ability to communicate with available shippers is their most pressing necessity. Shortly, a smartphone device for transport companies that connects all parts of the operation, from ordering a load to obtaining delivery, is expected to become the industry standard.
Enhancing Business Operations
Setting straightforward, attainable targets that link process initiatives to logistic systems is the first and most important step in successful process improvement. According to a logistics firm study, 36% of the businesses surveyed strongly agreed that their 3PL collaborators helped them reduce costs and develop business operations (Govindan et al., 2018). This means logistics partners should have the expertise and experience to look beyond supply chain and logistics processes and influence improvements through the entire operations system. They should also be financially secure, adaptable, and willing to take fair risks in the long run (Zijm et al., 2019). Since the logistics sector is so competitive, industry benchmarking plays a vital role in improving business processes. It is like the rat race – the race to be the best and the quickest.
Customer Service Improvements
Markets are becoming more dynamic, financial systems have become wider and more complex, and consumer tastes in terms of delivery times and fulfillment have changed. Clients now anticipate their logistics associates to help them solve challenges and thrive in a competitive market. This necessitates that logistics partners hire the best people with the right expertise and attitude (Gong, 2018). They should also improve and standardize the customer experience in all geographic regions, platforms, and touchpoints, including in-person experiences, phone calls, online conversations, emails, and social networks.
The most critical considerations to remember for consumers are transparency and delivery timeliness. Customers can monitor their parcel status and share it on social media sites thanks to technology and monitoring systems (Eremina, 2021). Customers’ expectations have risen dramatically in recent years, and they are willing to pay a premium for same-day delivery. As a result, logistics providers would need to develop something new and straightforward to offer the best customer support and keep their loyal customers to meet these demands.
Enhancing Supply Chain Visibility
Orders should be monitored to ensure that they follow the specified route and timetable, with reminders and warnings triggered in the case of delays, allowing for efficient response. Customers should receive alerts, such as delivery notifications, and monitor deliveries through a web portal (Eremina, 2021). The entire project schedule in a warehouse must be visible to logistics firms, including product receipt, packaging, order management and execution, and shipping. Plus, they will have insight into what is coming their way, helping them prepare their workforce appropriately.
Handling Human Resource
Managing the workforce is a job that comes with many obligations, which makes it even more difficult. One of the most critical staffing management criteria is to take a compassionate approach (Witkowski, 2017). When it applies to logistics firms, resource management becomes much more difficult because workers and drivers are usually based in separate locations, necessitating tight collaboration between them to ensure that orders are fulfilled efficiently. Logistics firms will name logistics administrators in key locations and deliver solutions on a timing and team timetable.
Stock Management Errors
Stock management errors can cost a business its credibility. In 2013, Walmart, one of the world’s largest stores, demonstrated that they were not the model to pursue (Jagtap et al., 2021). It is because of misplaced products, and the company lost $3 billion that year. Target lost out on a new and potentially profitable business in 2015 because product barcodes did not fit the software system’s numbers, which was a major mistake (Gong, 2018). These well-known examples show that today’s warehouse management systems leave a lot to be desired. It seems ridiculous that stocking practices are not adequately encouraged by software in this age of technical development. Walmart appears to have learned from its mistakes, as the company has now firmly established itself in the field of new technology and inventions (Govindan et al., 2018). A new grocery warehouse is set to open in 2020, according to the company. Robots will stack and load all of the items within this warehouse, saving both space and time.
For data collection, a warehouse-management smartphone app can use appropriate technologies. Most businesses use barcode scanners, but this device falls short when it comes to making intelligent, data-driven inventory decisions. In today’s world, wireless and mobile devices are commonly used. Plus, over the next few years, speech and put-to-light solutions have been developed to be widely adopted. According to a recent automation survey, 37% of respondents were involved in such advancements, but only 18% use these approaches (Eremina, 2021). People should also anticipate a greater acceptance of warehouse robots, locating and moving objects within the facility using mobile apps. Advancements in inventory management are needed to make it easier to identify goods, optimize storage space, and analyze which products are prioritized by consumers. Segregation, loading, and packaging can all be controlled by an inventory app. Items can be organized into categories based on their storage needs and distribution preferences. Warehouse zoning, for example, is a helpful strategy for dividing space into pickup and reserve zones.
Another critical factor to consider is how businesses keep their warehouses secure and what digital tools they use to manage their operations. An access control deterrent, which records the identification of people accessing the warehouse and security cameras and a fire alarm, should all be mounted in the factory. Since these precautions are already obligatory, the next step is to build and manage security variables via a specialized mobile app (Jagtap et al., 2021). It would be beneficial to incorporate security capabilities within a single inventory management app. Corporations would set up alarms and receive updates of what was happening inside their premises.
Finance for Supply Chains
In today’s dynamic world of global crises, exchange rate volatility, and natural disasters, exposure to supply chain funding is critical for sellers and logistics stakeholders to ensure efficient business operations and cash flow stability. Credit facilities, open new accounts, and freight audit fees, among other items, all require financing (Ul-Hameed et al., 2019). Although there are far more financing options now than ever before, double-checking freight invoices has never been simple – prices are varied and complicated, and carrier references are not always accurate. Furthermore, transportation is a cash-heavy industry, and payment delays can hurt shippers.
Driver Shortage
Truck drivers have challenging and demanding jobs all over the world. Companies are becoming more cautious in their hiring as government regulations become more stringent. Candidate driving histories are scrutinized for traffic infractions and inspection inconsistencies, lest the company’s Compliance Safety and Accountability (CSA) score be lowered. The average age of drivers in the United States is 49, suggesting that the labor shortage will intensify in 10-20 years (Gong, 2018). Besides, there is unspoken prejudice toward women and minorities in the industry.
Government Regulations
Governments have a lot of control over foreign exports, which has an effect on how a logistics business works. According to the Wall Street Journal, more than 40 entities in the United States are involved in trade exports, with over a dozen having a release and hold power (Eremina, 2021). After the deliveries have cleared customs, the US Consumer Product Safety Board and the Department of Agriculture need to approve them. Additionally, zoning permit laws and overseas and domestic shipping taxes have a bearing on logistics.
Internal Communication Ignorance
Large retail and distribution firms should retain their staff and streamlining their working process, which can be done digitally. Amazon’s latest decision to “gamify” the warehouse staff’s schedules produced mixed results (Glistau & Machado, 2019). The organization created a Tetris-style game that led employees through objects and tasks. On the bright side, it made the process more enjoyable and successful. On the negative hand, the scheme rewarded the fastest workers with points and certificates, inciting unhealthy rivalry and even resulting in demonstrations.
In either case, Amazon retains the most forward-thinking retailer and logistics company. Walmart is also up to date with the new fashion trends. The retailer established a supply chain school to train workers in addition to launching stock robots. The more technology is used in daily activities, the greater the need for STEM-educated employees (Glistau & Machado, 2019). Although management training systems are already in use, apps can be used to implement a new coaching style and adapt workers to evolving work environments, which is another field where logistics mobile app creation can concentrate.
Sustainability
There is a heavy emphasis on reducing emissions, mainly due to government anti-idling and emissions laws and public expectations and cost savings. Companies may comply by optimizing their routes and loads, monitoring and disclosing emissions, upgrading their engines, and using alternative fuels. The most recent truck models have the best engine output, pollution enforcement, and mileage (Ul-Hameed et al., 2019). These provide significant long-term benefits but come at a high upfront expense.
Technology Advancements
For logistics firms, adopting modern and advanced technology solutions has become a requirement. Given the scarcity of labor, fierce competition, and rising consumer expectations, technological advances will boost efficiency by reducing time, expense, and errors. Automation systems and data-driven software solutions for advanced packaging labeling, warehouse sorting, and other tasks have become essential. Companies may use shipment monitoring systems to keep track of their shipments around the clock, receive updates and reminders, and create personalized reporting. Customer service, operational performance, and safety can all be improved with data analytics (Brzozowska et al., 2016). Many key players in the logistics industry have embraced robotics and automated machinery—these aid in greatly reducing the time it takes to complete and distribute orders. The Internet of Things (IoT) can reduce risks and ensure the safe distribution of goods. The best fleet management system integrates with new generation trucks’ advanced sensors. This program allows for real-time visibility of trucks in transit and shipments onboard and main vehicle specifications. Many of the above technology solutions are relatively affordable, thanks to cloud computing. Many organizations, on the other hand, lack the professional staffing tools to gain information from them.
Effect on the Economy
High gasoline prices exacerbate the financial collapse and boost inflationary pressures, wreaking havoc on the US economies. Increasing enforcement regulations, decreasing demand, additional capability, and increased rises in key cost centers have placed this business under pressure (Glistau & Machado, 2019). Political unrest, a drop in manufacturing output, and an increase in the consumer price index, and a recession are all factors—Harms product and service production, as well as freight prices. Infrastructure development in building projects, on the other hand, raises incomes and product demand.
Inability to Connect with End Users
Clients are the driving force behind every logistics organization, and customer expectations can serve as targets for creating creative solutions. Customers want to monitor their orders at any stage and the ability to order online or offline, get a product shipped or pick it up in the shop (Witkowski, 2017). Another critical area to improve is delivery time of goods. Modern consumers expect their orders to arrive as quickly as possible, necessitating greater logistical difficulty in local storage and distribution. Clients also want more visibility into the status of their orders. Shipping companies should provide offline help in their operation to address last-mile distribution issues. Customers might review previously saved delivery details or contact a carrier offline, which would significantly benefit.
Challenges Confronted by Transportation Sector
Changing Consumer Expectations
As a result of technological advances, user expectations are changing. Furthermore, as clients become more information-savvy, they expect their transportation providers to keep them completely updated during the phase. Clients also want to find a company that works according to their exact specifications, owing to the ever-increasing volume of data available. As a result, the age of one-size-fits-all solutions is quickly disappearing. It is being phased out in favor of a more visible, innovation-driven supply chain (Jagtap et al., 2021). With such knowledge at their disposal, transportation experts need to focus on providing the best possible value to their customers. This means they will have to learn more about the effects of technological trends on the transportation process so that clients can see what is going on at every point.
Changing Digital Requirements
Many transportation companies are still figuring out how to approach information technology infrastructure. As a result, the key problem with changing digital specifications is significant (Zijm et al., 2019). They are hoping for the next digital bandwagon before dealing with the old issues. With such knowledge at their fingertips, transportation professionals need to act quickly. They can prepare for the necessary speeds by practicing with them. If they fail to do so, they will be forced to choose between two opposing ways of doing business.
Terrorism
Every other type of motion has been impacted by terrorism. Maritime and air transportation, on the other side, have been hit the hardest. Mediterranean invaders from North Africa’s Barber states kidnapped merchant ships and tormented their crews in the early 1800s(Witkowski, 2017). The outcome was a long-term rivalry between states and piracy of the sea. Crime has more than doubled in recent years all along shores of lawless Somaliland. Bandits today are more than just armed gunmen; they are well-trained soldiers with cutting-edge weapons, motorboats, cell phones, and Gps tracking.
Digital Revolutions
Digital revolutions entail reshaping both corporate strategies and business models to remain completely competitive in the digital era and this applies to both big and small companies. However, one thing is certain: failing to transform transportation processes to meet the digital revolution will result in lower sales and profits due to fewer investment opportunities. However, the digital transition necessitates new legislation and a change in business attitude (Chen et al., 2020). Installing apps and adding Internet of Things-powered GPS monitoring systems to properties is just the beginning of digitalization. Not only is there a need to expand on how information can interrupt your company, but there is also a need to expand on how data can disrupt the economy.
The Transition of Core Systems
Transportation companies need to understand their core processes to transform them. They should be aware of this before trying to interrupt their operations. It is a good idea to double-check because businesses prefer to build unique systems more frequently if they already know. Businesses that are rising at different rates make it difficult for investors to grasp what is going on. On the other hand, companies have a chance to revitalize their businesses as innovations emerge in the transportation sector (Wang, 2016). They will be able to innovate their supply chain management as well.
Political Upheaval
Transportation agencies are facing more difficulties as a result of political tensions. States are now using both tariff and non-tariff trade restrictions as expressions of political will. The need for logistics teams to adapt rapidly to evolving trade trends is growing due to these political barriers. Tariff weaponization, increased security obstacles, Trade Agreement Disputes, and sanctions are all political upheaval manifestations. Political disruption to trade, for whatever cause, brings transportation agencies’ resilience and versatility to the test, requiring them to be more cautious and sensitive at the same time (Schmidtke et al., 2018). Activities and partnerships with operators and other third-party service providers are disrupted. It raises the burden on the logistics team to do more in a moment environment.
Transportation Automation and the Internet of Things Partnered Up With Robots
Order fulfillment and warehouse automation with robotics have proved to be difficult for the business. However, because of the high demand, numerous transportation companies are willing to use them. Clients are calling for more advanced modes of transportation. With the growth of e-commerce, transportation companies should work more effectively and rapidly (Eremina, 2021). They need to process an individual’s instructions as quickly as possible. This is a market that has taken the industry by surprise. Many transportation companies are still adjusting to the new environment. Owing to labor shortages, robotics has been given the ability to transform the transportation landscape. Previously, about 80% of warehouse operations were carried out by hand. They should use robotics to make things more precise, scalable, and affordable as demand increases. Many transportation firms will spend the year trying to solve this puzzle.
Lack of Reliable Data on Shipping Conditions
Many goods should be shipped under particular environmental conditions, such as temperature limits. Due to the lack of a real-time view of suppliers’ shipping conditions, some logistics firms, both local and multinational, falsify details about how they have transported specific products. To save money, a shipping company can immediately turn off the fridge or freezer after leaving a harbor and turning it back on closer to the final destination (Nikolova-Jahn et al., 2018). The temperature might well be within the correct parameters when the specifications are tested at that endpoint. Still, the goods’ consistency will have already been impacted because the temperature specifications were not met during the journey.
Proactive Cybersecurity
As companies move to the digital era, many cybercriminals improve and gain new targets of all sizes and types. Not once, but on many occasions, transportation firms have been hacked. However, the majority of recent cyberattacks have come from inside the organization. Internal open weaknesses are caused by employees that have them. Staff who do not follow the planned Cyber Protocol are the source of the vulnerabilities (Masoudinejad et al., 2016). For a long time, transportation companies have battled this threat. The transportation industry will continue to face cybersecurity issues in the coming year unless a permanent solution is found. The transportation industry is working to improve supply chain visibility to improve product integrity and protection (Schmidtke et al., 2018). This, however, cannot be achieved without concerted attempts to address the industry’s challenges. The issues are costing the industry a lot of money. Much will have to be made to ensure the clients happy and trusting the systems.
Solutions for Logistics Application
Navigation and Maps
A navigation-enabled mobile app could significantly reduce transportation costs. These applications ensure the best possible performance and effectiveness of delivery by minimizing stops, finding trouble points, and determining the best routes in a particular scenario. The participation of stakeholders in the service is a vital consideration. It should be convenient for both shippers and carriers, and end-users should be happy with the outcome. Each person involved with the process should have their copy of the software (Brzozowska et al., 2016). Any operations program should provide a configurable map and navigation feature and remote monitoring and traffic data to make things simpler. The issue becomes more urgent as the chain lengthens. An all-in-one mobile app would make transportation management easier and delivery times faster, which are both significant concerns for shipping global companies.
Vehicle and Inventory Maintenance
Logistics companies need to monitor the condition of their vehicles regularly to avoid going out of business. They can incorporate fleet management systems to speed up the process (Zijm et al., 2019). There are apps like Fleetio that make examination and reporting easy (Schmidtke et al., 2018). Fleetio also has a different inventory management system, and there are several other applications with the same purpose, such as EazyStock. Procurement deals are more effective, and storage is safer when there is an automated system for storing different items and analyzing their output.
Labor Management
Maintaining transportation services without a system for assigning tasks and monitoring activities is difficult due to the many people involved. With the implementation of labor-management systems, human error was minimized, paperwork was removed, and overall productivity was increased (Nagy et al., 2018). Companies can easily control staff and equipment availability, track vehicle movements, and check on operation within their facilities to aid an excellent mobile app. Many time-consuming manual tasks can be reduced using mobile apps, such as allowing document sharing or offering a log for drivers and warehouse staff. People no longer have to physically sing themselves out of a job because an automated program will do it for them.
Analytical Tools
Although large transportation companies have begun to incorporate all of this, there are not enough current solutions that elegantly integrate all necessary functions. The ability to monitor all aspects through an application opens up the possibility of improved analytics and anticipatory techniques and facilitates workflow (Nagy et al., 2018). Automated systems that keep track of all the specifics of successful and failed shipments provide valuable information and real-time observations. Logistics firms would be able to solve challenges and avoid them with the use of appropriate digital resources (Govindan et al., 2018). Companies that adopt this logic and create custom apps to handle their deliveries will ultimately supplant those who cannot keep up.
Conclusion
Many obstacles exist in implementing transportation and logistics management activities in the international economy, all of which impact a company’s ability to function efficiently and cost-effectively. Terrorism is the most costly danger today and especially severe in the Indian Ocean, where shipowners continue to struggle considerable losses as a result of arms deals. The lack of facilities, integrated transport communication, the global economic crisis, and the need to catch up with technological developments are affected by corporations. Companies that can understand and implement effective problem-solving procedures would be able to grow their customer base. The ability to customize the transmission and logistics chain offerings to address the exact needs of the customer is also crucial in this intense competition area.
Versatility is among the most important areas of international management of logistics operations. Companies that can recognize and solve challenges are the ones that succeed the most in the regional transportation and logistics management sector. The international trade climate is much more complicated than the national one. As a result, it necessitates a solution that accepts the nuances while simplifying information providers and consumers.
References
Brzozowska, A., Ziora, L., Sałek, R., & Wisniewska-Salek, A. (2016). The Possibilities of Big Data Solutions Application in Logistics. The Publications of the MultiScience – XXX. MicroCAD International Scientific Conference. doi.org/10.26649/musci.2016.044
Chen, H., Jin, Y., & Huo, B. (2020). Understanding logistics and distribution innovations in China. International Journal of Physical Distribution & Logistics Management, 50(3), 313–322. doi.org/10.1108/ijpdlm-04-2020-403
Eremina, L. (2021). Innovative use of blockchain technology in the logistics industry. doi.org/10.15405/epsbs.2021.03.79
Glistau, E., & Coello Machado, N. I. (2019). Logistics 4.0 – Basics, Ideas and Useful Methods. MultiScience – XXXIII. MicroCAD International Multidisciplinary Scientific Conference. doi.org/10.26649/musci.2019.022
Gong, S. (2018). Supply Chain Finance and Risk Management: A Selective Survey and Research Agenda. In Finance and Risk Management for International Logistics and the Supply Chain (pp. 11-33). Elsevier. doi.org/10.1016/b978-0-12-813830-4.00001-0
Govindan, K., Cheng, T. C. E., Mishra, N., & Shukla, N. (2018). Big data analytics and application for logistics and supply chain management. Transportation Research Part E: Logistics and Transportation Review, 114, 343–349. doi.org/10.1016/j.tre.2018.03.011
Jagtap, S., Bader, F., Garcia-Garcia, G., Trollman, H., Fadiji, T., & Salonitis, K. (2021). Food Logistics 4.0: Opportunities and Challenges. Logistics, 5(1), 2. doi.org/10.3390/logistics5010002
Masoudinejad, M., Ramachandran Venkatapathy, A. K., Emmerich, J., & Riesner, A. (2017). Smart Sensing Devices for Logistics Application. Lecture Notes of the Institute for Computer Sciences, Social Informatics and Telecommunications Engineering, 41–52. doi.org/10.1007/978-3-319-61563-9_4
Nagy, J., Oláh, J., Erdei, E., Máté, D., & Popp, J. (2018). The Role and Impact of Industry 4.0 and the Internet of Things on the Business Strategy of the Value Chain—The Case of Hungary. Sustainability, 10(10), 3491. doi.org/10.3390/su10103491
Nikolova-Jahn, I., Demirova, S., & Entchev, E. (2018). Creating conditions for the application of digital dimensions in logistics activity. In 2018 International Conference on High Technology for Sustainable Development (HiTech) (pp. 1-4). doi.org/10.1109/hitech.2018.8566256
Schmidtke, N., Behrendt, F., Thater, L., & Meixner, S. (2018). Technical potentials and challenges within internal logistics 4.0. 2018 4th International Conference on Logistics Operations Management (GOL). doi.org/10.1109/gol.2018.8378072
Ul-Hameed, W., Shabbir, M. S., Imran, M., Raza, A., & Salman, R. (2019). Remedies of low performance among Pakistani e-logistic companies: The role of firm’s IT capability and information communication technology (ICT). Uncertain Supply Chain Management, 369–380. doi.org/10.5267/j.uscm.2018.6.002
Wang, K. (2016). Logistics 4.0 solution-new challenges and opportunities. In 6th International Workshop of Advanced Manufacturing and Automation (pp. 68-74). Atlantis Press.doi.org/10.2991/iwama-16.2016.13
Witkowski, K. (2017). Internet of Things, Big Data, Industry 4.0 – Innovative Solutions in Logistics and Supply Chains Management. Procedia Engineering, 182, 763–769. doi.org/10.1016/j.proeng.2017.03.197
Zijm, H., Klumpp, M., Heragu, S., & Regattieri, A. (2018). Operations, Logistics and Supply Chain Management: Definitions and Objectives. Operations, Logistics and Supply Chain Management, 27–42. doi.org/10.1007/978-3-319-92447-2_3