Digital ecosystems: the future of transport and logistics

The disruption of a classic market as a result of COVID-19

We now know that the pandemic has had a tremendous impact on various aspects of society. This also applies to 'work life'. In transport and logistics, we see that COVID-19 has accelerated technological developments in the sector at a gigantic pace. What seems? Digital ecosystems are coloring the future of transport and logistics.

From $ 8.1 trillion to $ 15.5 trillion: room for new developments

The transportation industry is exploding. This ensures that enormous digital changes will take place in the sector. While the global industry was still good for $ 2017 trillion in 8.1, it will almost double to $ 2023 trillion by 15.5. This according to a study by Transparency Market Research.

New business models and IT innovations are making their way into this world. This applies not only to seasoned companies such as Amazon e-commerce platform or carriers such as DHL and UPS, but also to start-ups and scale-ups working with blockchain, Internet of Things (IoT) *, Artificial Intelligence (AI ), etc.

* Internet of Things: IoT describes the network of physical objects (things) that are embedded with sensors, software and other technologies for connecting and exchanging data with other devices and systems via the internet.

The consumer and digitization at the helm

One of the main reasons for these changes? The consumer. In addition to the effect of the pandemic and the global economic recession, consumer expectations are also causing the global supply chain to change. These expectations are formed by companies such as, Zalando and Coolblue. Consumers assume that it should be possible for every webshop, for example, to have the order delivered before 23:59 the next day. This not only creates challenges, but also opportunities.

An important part of this disruption within the sector is digitization. From now through 2025, digital ecosystems * will represent $ 60 trillion of global revenues. As a result, the market share will increase from 2 to 30 percent in 2025.

It is of course no wonder that this disruption is not without a struggle. Supply chains were stretched to the maximum in 2020. Many carriers and carriers were no longer able to transport the amount of shipments within their own network. To bring order out of the chaos, new technological initiatives such as blockchain, IoT, AI, mobile apps and IT platforms will conquer the sector. Offering your customer the same services as Amazon, Coolblue or in your webshop is only possible with huge IT investments.

* Digital ecosystem: A digital ecosystem is the interaction between the different channels (online and offline), the consumer and the partners involved (for example suppliers, carriers).

The golden formula: software and data

The basis of all these initiatives is software and data. This creates many opportunities for entrepreneurs who want to change the way of sending and receiving shipments. A response from Scott Sureddin, CEO of DHL Supply Chain in North America: "Transport and logistics is an industry that has a lot of potential to benefit from all technological developments, as many companies still focus on manual processes." Sureddin also indicates that a lot of data is processed in an inefficient manner. In addition, the use and deployment of capacity and the deployment of the possibilities of, for example, first and last mile can be much more effective.

Disrupting this sector, with its many parcel boxes, trucks, trains, planes and cargo ships, will not be resolved 1-2-3. According to Sureddin, the cost pressure and the large share of other variables in any supply chain has a huge impact. "DHL strongly believes in the power of technology to significantly increase productivity, increase efficiency and give companies better visibility and forecasting."

Digital ecosystems as a foundation

Digital ecosystems become the foundation for new business models in transport and logistics. According to a prediction of IDC 25 percent of organizations worldwide will ship shipments by 2023 using independent SaaS * platforms or more focused on transportation and logistics: LaaS * platforms. This results in improved efficiency in cargo matching and lower shipping costs. From research of Gartner also shows that 80 percent of professionals significantly increased budgets for logistics outsourcing by 2020. LaaS platforms give organizations the opportunity to quickly 'hitch a ride' on all new technological initiatives instead of building them themselves. The latter is much more expensive. Moreover, everything goes via the cloud, so you do not have to load updates yourself, it is fully automated.

As Sureddin says, there is currently too much focus on manual processes. Wuunder, as a LaaS platform, has been trying to disrupt this traditional market since 2016. Wuunder adds value by digitizing these current processes for our customers. In this way we reduce costs and increase customer and end customer satisfaction. With our simple links, multi carrier strategy, automatic bookings, scan and print method, invoice control and proactive follow-up of issues with shipments, etc., we ensure the automation of the entire booking and shipping process.

Organizations such as Amazon, Coolblue and set the benchmark for other web shops. Without LaaS platforms, it is extremely difficult for these smaller parties to keep up with that benchmark, but also with the expectations of the consumer. You can do everything yourself, which costs a lot of time and money, or you outsource it. And that can be done on different levels. At Wuunder you can choose between 4PL * and 5PL. Managing the transport falls under 4PL. 5PL covers the management of the entire chain, so from the factory to the end consumer.

* SaaS: SaaS stands for Software as a Service.
* LaaS: LaaS stands for Logistics as a Service.
* PL: PL stands for Party Logistics.

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