Technology’s Effect on Outsourcing Logistics

3PL outsourcing has always moved forward as quickly as technology developments would allow. In the very near future, a number of recent technologies including the Internet of Things (IoT), 3D printing, driverless vehicles, drone delivery and augmented reality are about to drive the industry forth to a new and as yet unknown future. As quite a few of these technologies are still being tested, there remains a question of how significant their individual and collective impacts will be, but it’s certain that they are about to power the next phase of development in the 3PL industry.

The impact they and other new technologies are about to create will be seen in cutting the costs of storage, labor, and transportation. They will also be great for customers, by providing a more efficient and higher quality of service. If we take the example of the possibilities presented by drones, which can deliver items to customers in a fraction of the time it would previously taken via the road and rail infrastructure. This capability and the advent of driverless vehicles mean that the costs previously associated with drivers will become defunct.

There are a few recently developed technologies that are already making headway into transforming the industry. The major logistics outsourcing companies have already been implementing highly sophisticated and costly systems like Global Positioning Systems (GPS), transportation management systems (TMS) and warehouse management systems (WMS) for the best part of the last decade. These technologies are under a constant cycle of development, and new technologies are being integrated into their systems to provide a service that is more cost effective, reliable and time efficient. The most recent innovations in TMS and WMS mean that companies can respond to market dynamics in real time, due to the capability for insight they provide. IoT technologies help with the integration of these systems and with giving insight by enabling different items to interact, provide data for analysis in real time and execute logistical functions autonomously.

These technologies are being adopted at a variety of speeds by a variety of companies, and some have more enthusiasm than others. It is perhaps more prudent for the smaller companies without the research and development capabilities of larger ones to wait it out and see which technologies provide the most value before implementing them.

This blog post is based off of an article from Cerasis, a 3PL with a focus on technology and managed transportation services.