In 21st century of technology and digital age, most industries are antagonizing immeasurable changes in ways never to have been thought in pre-digital traditional age. Every new day is about new technology, a new market competitor with radical new business model ready to disrupt the existing business model. Supply chain and Logistics are one of those industries were these changes are profound with paramount opportunity. This sector has huge challenges were rebellious vicissitudes are taking place that is literally re-shaping the market altogether.
Considered the most unorganized and fragmented sector of India, in era of digitalization, new technologies followed with economic reforms and government initiatives is bringing this sector to a responsible state. Technology is shaping the market in ways that is now just beginning to become visible and new entrants like Sagisu, Blackbuck, Shadowfax, Delhivery etc are in-fact shaking the industries fundamentals itself. With breakout of e-commerce in India, Logistics was the one immediate sector that gained importance and is bound to drive this segment even further and yet despite the market size and opportunity, logistics has only been scratched on the surface only and remains to be cracked.
Despite a long road ahead, below are some of the forecast for the Third Party Logistics (3PL) in 2020:
- The rise of Mobile Apps: 2020 is bound to see increased reliance on Mobile Apps by 3PL companies. Not only it reduces paper records and increases efficiency in documentation but also improves ability to trace consignment from start to end and with IoT even in real-time.
- The rise of smart logistics software solutions: In 2020, 3PL companies will bring more advanced and smart logistics software solutions that will be more agile and incorporate AI and will be completely big data driven to provide route optimization, real-time tracking, insights and analytics
- The rise of increased collaborations: In 2020 to fulfill surge in demand, Large companies and numerous 3PL logistics companies will tie up and collaborate leading to standardization of the industry to reduce fragmentation of this industry and each player brining in new unique value propositions.
- The rise of efficiency and decreased volatility: With increased collaborations and smart logistics solutions, logistics movement will become predictable and hence efficiency will increase and with multiple 3PL players involved, high volatility in the market will be condensed.
- Increased Transparency: As the fragmented logistics sector gets defragmented and with intensive use of technology, 3PL companies will bring unprecedented level of transparency in this sector fueled by competitions. It is expected that from 2020, Customers will soon see transparency in price, freight movement and real time monitoring of the goods and its conditions.
- Increased funding and R&D: With growing e-commerce industry which will directly benefit the logistics sector, in 2020 it is expected that more new entrants will jump in this sector and 3PL companies will see huge investments from VC’s. The increased funding will further lead to investment in R&D to develop future cutting-edge technologies and ways of disrupting the sector further.
- Use of E-Vehicles and Introduction Autonomous Vehicles: In 2020, it is expected that 3PL companies start shifting towards E-Vehicles for environmental and economical reasons. The uncertainty in fuel price will further accelerate this development and with its even expected that by 2020 3PL companies may introduce Autonomous Vehicles for increased efficiency in delivery process.