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Data at the Center of an Evolving Logistics Industry

Updated: Feb 29

The Transportation & Logistics (T&L) Industry’s evolution to a high-tech, data-reliant operations model may be subtle to their end customers, but the industry has transformed traditional expectations and now requires high-quality and easily accessible data to keep pace with evolving demands for services. Traditionally, logistics was about getting goods from point A to point B quickly and efficiently. Now the industry is undergoing big changes, and consumers of T&L services need to make investments in their data and infrastructure while being mindful of a holistic data strategy to leverage these changes effectively and maintain competitiveness.  

What has changed to suddenly transform the industry into a hotbed of tech investment, innovation, and new competitors?

  • Rise of Ecommerce & The Amazon Effect – As Ecommerce has grown and Amazon became ubiquitous, it has raised the bar for a generation of consumers to expect the same data accuracy and quality that eCommerce companies provide.

  • T&L Customer Digitization – As T&L customers and partners become digitized, T&L companies need to keep up. If your customer wants to send you orders via EDI or API instead of emailed spreadsheets, you need to be capable of receiving orders via EDI or API.

  • Digital Native Competition – The T&L Industry is increasingly filled with new companies started by digital natives with lighter physical footprints, stronger digital presences, and high reliance on quality data to win business by betting on agile pricing.

  • Sophisticated Cost Savings – The low hanging fruit has already been picked. As competition keeps costs flat, savings within accounts need to be found around the edges.   Can orders be consolidated into fewer shipments? Can trucks be packed more efficiently with dynamic stacking rules but avoid increasing damage counts within shipments?

Given these changes to the market, there are increasingly large datapoints being tracked and shared between companies. Fortunately, if a company can follow the most common and basic data best practices, they will be well positioned to take advantage of these changes in the T&L industry. Creating a data lake or central storage location instead of keeping them in separate DBs or just within applications is a good start. Taking steps to ensure accuracy of upstream data, like item weights and volumes, is important. Implementing data management disciplines to minimize data duplication and provide just-in-time access will reduce costs and increase flexibility and allow a company to focus on other higher value efforts. Once these and other best practices are followed, T&L companies can start leveraging that data to increase revenues in more advanced purposes.

  • Capacity Analysis & Spot Market Bidding – Leveraging the spot rate market to reduce empty trucks and increase revenue requires many datapoints being available and leveraged into a single dashboard that can help generate additional revenue and avoid unprofitable return trips home by empty trucks after making one-way deliveries.

  • Reducing Carbon Footprint – The ability to quantify existing carbon footprints will better allow companies to reduce and get to carbon neutral within a timeline they feel is appropriate. Within the T&L industry, fuel costs are a large driver of competitiveness, so being able to track and reduce these costs will not only help marketing efforts, but also will help in cost competitiveness.

  • AI & Advanced Data Modeling – As AI grows and becomes more developed, the companies that will be able to leverage it will have large data models to feed it, allowing it to learn faster and utilize larger datasets to make decisions. A good data warehouse is essential to a strong AI that will have untold implications in the T&L Industry, helping write SOWs to win customer contracts or staying ahead of cost increases.

  • Robotics & Automation – Balancing labor costs and service levels and costs is always a challenge. Automated loading and unloading systems can reduce labor costs and allow companies to put away goods through the night, having these items ready to go for outbound delivery in the morning without relying on inconsistent and unwanted 3rd shift workers.

An even more lightweight solution like POWER BI reports can be utilized as well to meet customer needs and help expand existing accounts into other workstreams, while other larger solutions are implemented to win new business or expand margins on existing business.

There is no set blueprint for how T&L Companies find their own specialties and develop their own solutions to keep up with customer expectations, industry disruptions, and modernization in the industry.  But without recognizing the importance of data strategy to withstand changes and take advantage of the shifting landscape, even the most proficient companies at getting goods from point to point will be left behind.


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