Diversification, Blockchain, Decarbonisation and Big Data as Top Trends in Logistics

Source of information: DHL Express
  • The transformation of logistics in 2022 has been accelerated by megatrends and macro factors such as COVID-19, climate change, urbanisation and geopolitical events.
  • In its DHL Logistics Trend Radar report, DHL has identified key trends that will shape the future of the logistics industry in the coming period.
  • Among other things, risk mitigation and diversification of supply chains will be of great importance. To this end, companies will be betting on Big Data solutions, multisourcing or multishoring.
  • Sustainability remains a leverage for innovation, and decarbonisation and alternative energy solutions will have the greatest impact on transforming the industry.
  • Increasing automation can be expected, including the growing use of mobile and fixed robots.

“Last year, we published the sixth edition of the DHL Logistics Trend Radar report – an interactive overview of key trends in logistics. In the near future, significant transformations of the industry will result from, among other things, the diversification of supply chains, decarbonisation, the use of alternative energy sources and robotisation. Adequate advanced preparation for the upcoming transformation and changing expectations towards logistics companies can demonstrate the maturity of the industry and its readiness for continuous development. As a leading operator of international air shipments, we aim to pioneer these changes, inspire the industry and share best practices,” comments Tomasz Buraś, CEO of DHL Express in Poland.

Resilience of supply chains

Recently, companies have been particularly affected by climate change and geopolitical events. These are having an increasing impact on day-to-day operations, so companies are constantly looking at ways to increase the resilience of their supply chains. One of the most popular trends in this regard is diversification, including so-called multisourcing and multishoring. The first strategy means working with several competing suppliers, while the second focuses on an even greater geographical diversity, providing services to entities from different countries or regions of the world.

“The last two years have shown us the importance of reliable supply chains in the logistics process. In addition to the solutions indicated, companies can also use nearshoring, i.e., greater regionalisation of suppliers. It is also worth considering the use of tried-and-tested and reliable ways of delivering goods, which guarantees no downtime and is more resilient to any turbulence in global trade. The fastest and most efficient method of delivery is by air, which, thanks to its extensive network of connections, can ensure business continuity and maintain cash flow,” adds Tomasz Buraś.

Expanding the supplier ecosystem and the production and distribution network provides an opportunity to increase the resilience, flexibility, responsiveness, as well as the competitiveness of the organisation. To this end, 76% of the companies surveyed plan to make significant changes to their supplier base in the next two years. Another key to building business resilience is visibility, which can be increased with Big Data solutions and Big Data analytics.

Technology will increase control

Another way out that will contribute to visibility and resilience is Digital Twins technology. This is a simulation or virtual 3D model, which is used to plan and manage real systems. Digital Twins technology allows a better understanding of the processes taking place and predicting their behaviour. It can also be used to optimise production and maintenance, as well as to manage infrastructure and prevent unforeseen events. It is estimated that unplanned downtime can be responsible for losses of up to USD 50 billion a year. In contrast, by relying on the Digital Twins solution, companies can reduce the risk of failure by up to 70%, maintaining supply chain continuity.

Blockchain technology can also be used in a similar way. With the ability to record information in the form of inseparable blocks, this solution makes it possible to track and document every transaction or exchange in the supply chain. This allows for greater transparency and reliability of data, as well as better management of the entire process. Blockchain can also be used to record information on products, raw materials, warehouses, transport and other aspects of logistics. This means, for example, more accurate tracking of product and raw material deliveries. Furthermore, smart contracts based on this technology can streamline processes and reduce the number of errors.

Sustainability as a driving force

It is clear from this year’s DHL Logistics Trend Radar that the concepts of sustainability and environmental protection remain relevant to the business sphere. Among the dominant trends, the further reduction of CO2 emissions (decarbonisation), alternative energy sources, the concept of a closed loop economy or environmental management were highlighted.

Recently, the World Economic Forum announced that the price increase associated with a zero-carbon supply chain will average no more than 4%. Additionally, many customers are willing to pay more for more sustainable options. Pro-environmental technologies and concepts are proving to be increasingly affordable and viable to implement in organisations. On top of this, 85% of customers’ shopping habits have become ‘greener’ in the last five years and 65% of them are trying to live a more frugal lifestyle. As a result, companies are looking at how new solutions could be applied in their own supply chains and the concept of sustainability is becoming an important part of business strategy.

Both customers and business partners expect more sustainable and environmentally friendly transport solutions. Hence our support in reducing the environmental impact of their operations. It is also a matter of responsibility – supply chains can account for up to 60% of global CO2 emissions. As a leader in green logistics, we are taking several measures to reduce the environmental impact of transport. These include electrifying the vehicle fleet, implementing alternative fuels or optimising last mile deliveries. In addition, through programmes such as DHL GoGreen, with which we enable the analysis of transport emissions data, we can help our partners understand and reduce the environmental impact of their operations, says Tomasz Buraś

Another trend that could change existing business models is the circular economy. This concept is about increasing efficiency and reducing the environmental impact of business, through better resource management (recycling, energy efficiency) and independence from certain external suppliers. Currently, only 8.5% of all materials are recycled or reused.

Automation of logistics processes

To keep up with growing consumer demand, companies will need to start exploring the opportunities that automation and robotisation bring. An important trend to mention is the increasing use of mobile and fixed robots, among others in production halls or handling units.

Mobile robots are currently used to move goods, help with loading and unloading. They can be used to keep buildings clean and safe. Fixed robots, on the other hand, can be placed at strategic points to optimise processes. In the future, it will be difficult to imagine logistics without robotisation, where autonomous machines or machines that support employees are used.

“Automation will undoubtedly support logistics processes in the pursuit of even greater efficiency, but the value of the industry is in the people – experienced, educated specialists who know the relevant laws and regulations. With operations in 220 countries and territories around the world, we can benefit from the knowledge and experience of our overseas colleagues; moreover, thanks to our network of in-house customs agencies, we are able to handle shipments even more efficiently, thereby significantly reducing customs clearance times. This would not be possible without people,” concludes the CEO of DHL Express in Poland.