Track and trace: Why your business needs it more than ever
By Justin Baird, Head of Innovation Asia Pacific, DHL Customer Solutions & Innovation
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| Source: DHL. Baird. |
Improving visibility is also becoming more vital to global trade and the logistics industry. In the fifth and latest edition of DHL’s Logistics Trend Radar, at least 11 of 29 key industry trends have direct implications on visibility, or depend on reliable tracking infrastructure as a core element of their development. Some of these trends include omnichannel logistics, smart containerisation, and next-generation security.
Track and trace is here to stay as a value-adding component of any supply chain. Here are three reasons why:
Digitalisation is the future of logistics
With globalisation on an irreversible path and the exponential rise of e-commerce, ballooning trade volumes weigh down on existing supply chain infrastructure. The logistics industry has looked to digitalisation for a trove of solutions that promise to increase efficiency and reliability, lower costs, and a more sustainable value chain.
Recognising that trade growth depends on seamless, global logistics networks, Deutsche Post DHL Group implemented its Strategy 2025 – Delivering excellence in a digital world to build the capacity and capability needed to support this trajectory. Track and trace systems that use Internet of Things (IoT) devices to collect data play a central role in laying this groundwork by tracking all the attributes of a shipment, including location, temperature, humidity, shock, and uploading it to the cloud.
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| Source: DHL. Logistics use cases fall within three main areas: smart operations, transportation, and last-mile delivery. IoT-driven track and trace technologies can make a positive business
impact by incorporating smart operations, improving visibility and
control during transportation, and building a robust, cost-efficient
last-mile delivery strategy. |
Tapping on unprecedented volumes of data being collected across the entire supply chain has transformed the industry as a whole. Big data analytics has helped with route optimisation, sped up processing capabilities, and empowered smarter forecasting to reduce costs and mitigate risks.
Nearly all third-party logistics providers surveyed in a comprehensive study said that data-driven decision making is essential to the future success of supply chain activities and processes.
Better visibility makes for a more resilient and sustainable supply chain
As economies the world over battle with COVID-19, political instability, and a looming recession, more are looking towards bolstering their distribution networks. Clear shipment and asset level visibility can help companies to navigate uncertainty and stay in control through major disruptions by identifying, prioritising and managing risks and inefficiencies early, to facilitate their response in crisis scenarios.
According to Megan DeFauw, MD and Partner at Boston Consulting Group, now it is time to make strategic supply chain improvements that can help reduce the impact of future disruptions. She believes that the value from this increased resilience far outweighs the small cost benefits companies might get when they try to squeeze out a few additional cents out of their global supply chains.
Of particular concern today is the trade of counterfeit pharmaceutical goods. Authorities in over 90 countries seized US$14 million worth of counterfeit critical medical supplies in a major bust during the COVID-19 pandemic alone. Moreover, up to 30% of drugs sold in emerging markets have been found to be fake, with counterfeit drugs causing around a million deaths each year.
Improving shipment visibility empowers companies to store and share data proving the legitimate and sustainable sourcing of their products, to ensure quality standards and protect consumer well-being. Furthermore, track and trace technologies are critical for security and preventing theft, a growing concern particularly for the imminent shipments of genuine COVID-19 vaccines.
Continuous innovations in IoT also help logistics players to streamline shipment tracking and reduce waste where possible. For example, concerns over the cost of GPS tracking devices and the difficulties involved in retrieving them upon fulfillment have urged providers to take action.
To optimise costs and in line with DHL’s GoGreen strategy, we are also working on smaller, non-disposable tracking devices that can be retrieved easily via mail. These and other similar devices could, in the future, even be powered through energy harvesting — tapping on environmental radiation that comes from nearby devices and electrical wiring.
Give customers what they want
Ultimately, for both B2B and B2C players, the core benefits of track and trace include risk mitigation, operational control, improving customer engagement and satisfaction, and expanding revenue streams.
This could entail offering customers the option to access relevant information on their shipments through dedicated, streamlined platforms. For example, DHL Global Forwarding has the myDHLi system which allows shippers to book shipments, get quotes, and retrieve information on shipment status.
In the last mile, missed deliveries can rack up costs amounting to billions of dollars each year. Customers are likely to abandon retailers after receiving incorrect or late deliveries, even just once. To address this, DHL Express empowers shippers with its On Demand Delivery service, which gives end customers the choice of how they would like to receive their delivery, with proactive email or mobile notifications about a shipment’s progress. This not only provides customers visibility but also offers logistics providers greater control and valuable actionable insights — such infrastructure upgrades come at a cost and there must be a strong business case for adoption.
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