Life gets interesting with challenges that we meet in the journey. How we handle a particular challenge determines who we become and what rewards we get from life.

Same applies for any logistics company. Challenges have and will always exist. 

It is a fast-paced global market and it makes it challenging for a company to stay competitive without proper logistics. The world is increasingly becoming more complex and interconnected, which paves way for more significant economic growth and also causes new and unpredictable market disruptions.

The coronavirus pandemic affected businesses on a profound level last year in particular. Many companies felt vulnerable logistically with airports shut down and lockdowns across the globe causing disruptions in supply chains.

In coming decades we can expect more opportunities and challenges in the logistics sector. Businesses must optimise their logistics systems to remain competitive as new technology, automation, and AI technology enter the field.

The future of logistics is focused on building on technology – automating possible logistics processes. Different software solutions will help boost the performance of different industries, resulting in speed, efficiency and customer satisfaction.

There are few risks and obstacles that any logistics company face, for instance:

1. Unknown Supply-Chain Risks

Coronavirus pandemic has proven that we live in an uncertain world. Businesses need to increase their supply chain flexibility to remain competitive in order to cover unknown risks.

To add to the Covid-19 pandemic, 2020 was also a historically troubling year. Storms and natural disasters, pretty much everything challenging took place. 

About $95 billion incurred in losses. Supply chains worldwide were affected by wildfires and inclement weather. In order to avoid supply chain issues in tough times, selecting a reliable and trustworthy shipping company has been crucial.

In a world as interconnected as today, supply chains have become extremely long. For example, a car manufacturer in North America might import engine parts from Far-East. Hence, longer the supply chain, higher the risk of obstruction. Companies are required to assess and identify possible supply-chain disruptions and develop a backup plan.

2. Supply Chain Digitisation

One of the real challenges for any logistics company is the visibility of the supply chain. This means – a company’s ability to locate a particular part or product as it travels down the line to its last destination.

Mostly, companies these days have very little visibility of their supply chain. Companies these days have certain amount of data about what happens to their product within their factories or warehouses, but they don’t necessarily have visibility beyond their section of the operation.

Hence through technology, businesses can collect, analyze and share real-time data about the state of their product. Which will allow companies to have a more accurate picture of the entire supply chain, which in turn help them to respond more quickly to problems.

Innumerable logistics companies are investing in the digitisation of their supply chains, a trend that is expected to continue in coming years. Companies that won’t embrace new digitisation strategies are likely to fall behind competitors who collect real-time data about their supply chain and business. 

We are required to boost productivity and efficiency by means of an ERP software that reacts quickly and can optimize processes as we race against time.

Companies need connectivity in adverse circumstances: Shipments are submitted to extreme conditions which forces the forwarders to have a safe technology that resists the adversities.

3. On-Time Delivery

Often customers demand faster and cheaper deliveries. Which has led to a norm of delivering products in just a matter of days. Giants like Amazon are raising the bar with same-day delivery, making it challenging for many other companies to match.

There are two strategies that are being used to increase the speed and efficiency of their deliveries. Using small decentralised warehouses instead of giant distribution centers to reach the consumers is microfulfillment. Fast delivery is accessible to people even in remote locations as the warehouses are more widely scattered. Many US based companies in the U.S., such as Amazon, Target, and Walmart, are embracing this strategy to reduce delivery times.

Another strategy is the automation of warehouses with robotics and artificial intelligence. Microfullfilment centers along with the latest AI creates small and efficient warehouses that can reach clients a lot quicker. 

Key to a company’s success is having a network of fulfilment centres with the latest technology.Complexity of deliveries: The urgency of the deliveries is increasing, customers want to receive the goods and the customs and legal procedures require your time, as well as other adversities that arise along the way.

4. Dealing With the Climate Change Crisis

There are various reasons why climate change will be a challenge for companies logistically in the coming decades. To start with, there is going to be increasing legislation regarding climate change. The companies who prepare ahead of time and adapt their logistics will have the advantage.

Sustainable logistics practices are more beneficial than non-sustainable practices. 

Which means, companies that embrace sustainable practices will be better equipped for upcoming legislation and become more efficient overall. There are a wide range of methods businesses can adopt to become more sustainable. Making use of recyclable packaging materials, and removing excess packaging are just some methods companies can take to reduce their environmental impact.

There is a demand by consumers for companies to become more eco-conscious across many industries, in particular in eCommerce. Some giants in the industry have committed to becoming carbon neutral by 2040, and they also want to power all their operations with renewable energy by 2025. Inorder to remain competitive, eCommerce businesses will have to keep track of these changes to bring in more consumers.