Top Challenges for Today’s Logistics Providers

Today’s logistics customers demand flexibility and visibility.

In a recent survey based on interviews with 62 international supply chain executives as well as over 1800 respondents from the logistics and manufacturing industry found that the top priority for logistics managers was “meeting customer expectations” followed by “on-time delivery”.

Many of the respondents noted that customers can change delivery orders based on 10 days or less, and a majority indicated that that this window can be one day or less. (download the whole survey).

Even more challenging, customers are also increasingly demanding full transparency to their orders and inventory through the entire life-cycle of raw-material to finish-goods to sale to sometimes reverse-logistics.

That means full sight of each order and its associated item level detail at all times in real time.

Giving customers the flexibility and visibility they want is especially difficult given that many logistics service providers must serve customers with operations that are spread out across the globe.

The chart below shows the results of a 2014 survey that asked where companies are operating today and where they expect to operate in 5 years. Clearly the challenges of globalization are only going to grow:

Percent of Respondents Operating in these Regions Today and in Five Years

Source: Trends and Strategies in Logistics and Supply Chain Management

Yet while a global customer base certainly presents a lucrative target, it also provides a new set of challenges for logistics service providers (LSPs) accustomed to providing standard logistics solutions to a homogeneous regional customer base.

Their solutions must be tailored for each customer to accommodate different government regulations, new retail channels such as mobile applications, and industry specific requirements such as tracking and tracing, cold chain, and shelf-stocking services.

8 Opportunities for Today’s Logistics Providers
Orchestrating Logistics in a Complex World

Being part of the logistics industry while the supply chain is undergoing such a rapid transformation can be perplexing, and maybe even overwhelming.

Because manufacturers are creating more diverse sets of product options, packaging designs, and logistics arrangements, today’s logistics providers must deal with a staggering amount of complexity in the form of fragmented channels, expanding product variations, and increasing customer demand for customized solutions.

In response to this complexity many are promoting the concept of the 4PL, where logistics providers can offer higher value service that goes beyond physically moving the product, to providing comprehensive supply chain solutions.

Yet there is still very little information available to logistics service providers (“LSPs”) as to how their current technology investments are supposed to fit into this 4PL vision, what tangible steps logistics service providers can take to enable these new services, or even what precisely these higher value services could be.

Top 8 Opportunities for Today’s Logistics Providers