How the Internet of Things (IoT) Is Boosting Productivity for Logistics Businesses
The Internet of Things (IoT) market is exploding. Smart speakers, thermostats, and lighting are becoming more common in households throughout the world.
The consumer sector is often quick to adopt new technologies. On the other hand, businesses are much slower at implementing new tech. While many industries are still waiting to determine the potential return on investment in adopting IoT, the transportation and logistics industries are reaping benefits, from reducing costs, to improving accountability. However, productivity is one of the most significant areas where IoT devices are helping to improve the bottom line.
What Are IoT Devices?
The “Internet of Things” is a phrase that was coined in the 1990s by a consumer sensor expert. It refers to the inter-connectivity of electronic devices embedded in normal objects and equipment.
In the home, IoT devices may be used to control heating, adjust the lighting, and lock doors. Similarly, for the transportation and logistics industries, IoT devices offer a wide range of uses, including sensors, trackers, and other monitoring devices connected via Wi-Fi or Bluetooth technology. In fact, the transportation and logistics industries are expected to spend $40 billion annually on IoT devices by 2020.
Companies in these industries who are too slow to adopt IoT may be at a disadvantage within the next few years, while the early adopters are seeing productivity boosts in the following areas right now:
Real-Time Tracking of Shipments with IoT Trackers
With the help of IoT trackers, logistics companies can track shipments much more easily. There are a variety of tracking devices that provide real-time updates no matter where in the world the shipment is currently traveling.
Businesses no longer need to receive updates at each step of the supply chain. They have instant, accurate details of where the shipment is located and heading. This data helps save time, energy, and resources.
With accurate real-time tracking, logistics businesses can also provide instant updates to their customers. Instantly notifying clients of potential delays and minimizing the risk of lost shipments helps to improve client relations.
Advanced asset tracking using IoT devices also reduces the risk of theft and loss. Cargo theft cost businesses $114 million in 2016. Besides the cost of theft, logistics companies may suffer reputation damage.
IoT Devices Provide Environmental Monitoring
Besides tracking shipments, logistics businesses can monitor the condition of shipments. IoT sensors are available that provide environmental data.
These sensors ensure that shipments are kept within specific conditions. For example, food shipments, pharmaceuticals, and other disposable goods often have strict requirements. These goods may need to remain at specific temperatures.
The sensors can monitor the temperature and other data, providing instant alerts when the requirements are not met. By addressing the issue immediately, logistics can avoid the need to cover the cost of damaged goods.
Improved Analytics and Fleet Management
The combination of various IoT technologies may provide businesses with better analytics. From streamlining the supply chain to improving communication, the data collected provides many ways to increase productivity.
Detailed analytics also helps companies devise better methods for managing their fleets. They can review real-time data related to transportation times, fuel costs, and other aspects of the shipping process.
With lower fuel costs, fewer delays, and streamlined regulation compliance, companies also reduce the total cost of their supply chain logistics.
IoT devices may also help with fleet maintenance management. Besides installing sensors on pallets or containers, sensors are available for monitoring trucks, planes, and other vehicles. Businesses can monitor the engine and other components, increasing the efficiency of maintenance tasks.
Warehouse and Inventory Management
Besides improving the speed and productivity of freight transportation and asset tracking, IoT devices can help improve operations in the warehouse.
During fulfillment, warehouse operators may need to track thousands of goods of varying sizes. With the use of RFID tags, businesses gain the ability to identify the location of the goods within the warehouse.
RFID tags also contain valuable information that can be used to find the best storage location in the warehouse or help to organize pallets. With these devices, logistics companies can adopt a smart inventory management system.
After goods have been added to pallets or removed from the warehouse, the RFID tags can transmit data to a central database and instantly update the inventory. This helps to improve stock visibility and minimize shortages or misplaced packages.
Reducing Tracking Errors with IoT Devices
Implementing tracking devices on shipping containers and goods also helps to reduce human error. This includes errors that may occur in the warehouse or during shipping.
These errors often lead to delays, which can cause a ripple effect. When one shipment gets delayed, other shipments may need to get pushed back.
Delays and lost packages are costly for logistics companies. By implementing IoT devices to increase the efficiency and productivity of the supply chain, businesses may increase their profit levels.
With most logistics and transportation businesses implementing IoT technologies within the next few years, it will become more critical for others in the industry to follow suit.
One study found that companies using sophisticated solutions achieve profit levels 12 times greater compared to businesses with outdated solutions.
IoT will enable these businesses to reduce lost, damaged, and delayed cargo, which will result in a boost in client satisfaction. However, the greatest advantage is the ability to streamline processes, and give businesses the resources to increase speed and productivity at every step of the supply chain.
As time goes on, the Internet of Things is only going to grow bigger and become more essential to every industry, not just transportation and logistics.
Contact your Outsource IT account manager to learn how we can help to securely integrate IoT devices into your organization’s network, as well as, provide management, monitoring and maintenance of existing complex network environments which include IoT devices.