In late March, Maersk suspended their 2020 guidance on earnings until further notice. The coronavirus pandemic and its knock-on effects will have profound consequences for global supply chains in 2020.

The coming downturn in world trade will see some companies fold, and others merge in a bid to continue trading. So, the need for rapid innovation for freight companies who wish to survive has never seemed more significant. Let's examine the latest trends in freight and logistics for 2020.

SaaS TMS Adoption and Freight Brokers.

Shippers will increase the adoption of SaaS (software as a service) products this year. TMSs (transport management systems) will help with planning, procurement, and payment of freight. What was once an expensive tool for a company has now become much more affordable, thanks to increased competition.

Increased interest in TMSs is, in part, due to their ability to replace human freight brokers. TMSs can speed up the whole process, though this year, it will likely supplement the work done by humans. The benefits of reduced delays in booking and more efficient freight management mean that SaaS will play an increasing role in supply chains.

SaaS and Other Freight Software Systems Will Leverage APIs

APIs (application programming interfaces) are application functions that communicate with other software via a universal language. The beauty of APIs is that they only allow other software to access the data the owner wishes them to see. This enables companies to link together new software with legacy systems to create more powerful applications, without compromising proprietary data.

Linking new systems to legacy software historically proved expensive to design and create, which stifled innovation. Modern SaaS systems are user-friendly, quick to deploy, and can deliver cost savings in a short time frame.

Elastic Freight Through Technology

Innovations derived from SaaS and APIs will help to foster much needed Elastic Logistics over the coming year. Elastic logistics is the ability for a business to expand and retract freight capabilities as required. For example, instead of building a new warehouse, a company will rent a suitable building on a short lease to cover capacity requirements.

Data-driven decision making made easier by SaaS and APIs can utilise resources more effectively. Logistics companies making smart decisions can reduce fixed costs in what will be a harsh trading environment.

Inventory Management Platforms and Omnichannel Fulfilment

Gaining accurate data for inventory management is a challenge, especially when systems are disparate and isolated from each other. A unified method to track stock across all of the supply chains can prevent shortages, excesses, and the expiry of perishable products before they can be sold.

Customer expectations for next-day delivery to their homes stress the need for robust Inventory Management Platforms. Omnichannel Fulfilment, where stock for an order can be supplied from warehouse, shop supplies, or direct from the manufacturer, requires that Inventory Management Software be bought under central control on a standard platform. We'll likely see further strides made by stakeholders to improve inventory management in 2020.

An Increase for Suppliers in Strategic Distribution Partnerships

The coronavirus pandemic will stress global supply chains significantly for the foreseeable future. Suppliers will need to seek technological solutions to grease supply channels. They are also likely to seek out new strategic partnerships to broaden access to products and materials. Diversification will become the watchword to ensure continued and uninterrupted supplies.

Inbound Freight Management

On average, 40 percent of the annual freight budget is spent on inbound shipping.  And, of course, with all cost savings feeding through to the bottom line, seeking efficiencies in inbound freight is high on many businesses’ priorities. 

Having a formal workflow to manage and report on vendor performance, and hold them accountable should they not perform to standard, can help ensure a reliable and consistent inbound freight function.  

Consolidation in the Freight Industry

The coming months will see the collapse in global demand for some products, and some logistics companies will go into administration.  Shippers will need to revise their approved supplier lists, to line up replacements for those logistics companies that don't survive.

We could see an increase in mergers between smaller logistics companies as they look to take advantage of cost-saving measures and eliminate complexities.  Consolidation can be of benefit for stakeholders as supply chains become more efficient, especially in ensuring supplies of essential products such as food and medicines.

Inbound Freight Consolidation

Processing LCL (less container load) shipments is an inefficient method of transporting freight.  The consolidation of smaller amounts into a single container can bring a wide range of benefits.  It reduces congestion at loading docks and busy ports, lowers fuel use and emissions, and also provides cost savings for shippers.

Leveraging integrated supply chain systems smooth the flows of consolidated freight and provides flexibility and choice for shippers.  Real-time data can prevent bottlenecks and aid planning for all those along the chain. 

An Increase in Data Insight

For hundreds of years, humans have claimed that 'knowledge is power.' And today, all sectors of society seek to leverage knowledge, or data, to gain an edge. Big data applications for the freight industry seek out ways to interpret all the data we collect, and how we can use it to gain a competitive advantage.

We use big data to optimise our systems for efficiency, price, and speed.  But all too frequently, there are gaps in the data, which prevents an all-encompassing view from initial order to final destination.

Shippers should seek to fill in those gaps and organise the data collected on a central dashboard so that the relevant parties can have a comprehensive view of all the links in the chain.

At Logmore, we play our part in the logistics technology revolution with our condition monitoring systems for cold chain logistics.   Our innovative data logging sensors help the freight industry cut down on the waste of perishable and fragile goods during shipping.