What are the current global logistics issues?
The current global issues in logistics revolve around the burden of skyrocketing fuel costs, laborious paperwork and a lack of transparency into their day-to-day activities. According to recent surveys conducted to identify the challenges in transportation and logistics, the following metrics were observed:
- On average, fuel consumes 60% of the total operating budget. (Automotive Fleet)
- 49% of fleet managers spend 2 hours a week on invoice management. (Netradyne)
- Rising costs is a primary concern for 44% of fleet managers. (G2 Tech Marketplace)
- Supply chain disruptions lead to 54% of financial loss in logistics. (FinancesOnline)
- Maintenance costs cover 30 to 50 percent of the total cost of ownership. (WebinarCare)
Moreover, the survey conducted by Statista in 2020 reveals that challenges in last mile delivery and empty miles are becoming a common disruption in logistics and needs solutions in terms of reducing logistics costs (35%), making on-time deliveries (21%), and responding to last-minute changes (16%). However, these are just a few of the challenges in logistics and supply chain management.
How technology helps to overcome the challenges in the logistics industry?
According to a survey conducted by Forbes, an overwhelming majority (65%) of business executives in the logistics, transportation and supply chain industries have observed tremendous changes in their industry’s processes. Moreover, the survey states, 50% of companies believe that technological advancements have a strong impact on the supply chain, logistics, and transportation operations. For instance,
- 55% of fleets reported reduced fuel costs after using telematics software, which is a huge win. (G2 Tech Marketplace)
- Shippers can minimize freight invoice payments by 90-95% if they utilize a transportation management system. (GlobalTranz, 2018)
- Companies save over $100 annually on vehicle maintenance with coupons and deals found with the help of fleet management software. (G2 Tech Marketplace)
This is a significant shift in terms of technology adoption and integration into the industry to counter the current global logistics issues in order to streamline operations for better productivity and cost reduction.
7 biggest logistics problems and solutions and how to overcome them?
- Toll transactions: Keeping up with toll payments is an essential, yet arduous task for fleet managers and truck owners. Moreover, the unauthorized use of cash allocated for toll payments is unfortunately a widespread problem. Toll payments with FASTag helps to prevent misuse of cash or bribery, ensure shipment delivery on time without waiting in a queue along with saving on fuel costs without idling. It also helps to automate the recording of transactions to track expenses in real-time and monitor spending.
- Multiple Expenses: The skyrocketing cost of fuel is one of the major challenges in the logistics industry as their processes significantly depend on transportation. Moreover, the need to manage multiple expenses while traveling also involves a lot of cash payments and receipts that need careful attention. However, fuel and fleet cards can reduce expenses with rewards, prevent theft or misuse of cash and provide an organized record keeping system for spending transparency and control.
- Financial assistance: Financial assistance is of prime importance for logistics as it involves multiple payments and negotiations on a regular basis. Delays in payments due to manual processing or a lack of flexible payment methods will affect the operational efficiency. Moreover the logistics industry is prone to accidents and requires sufficient coverage to manage risks along with assistance in secure transfer of funds between parties. Fintech will be the ideal solution to fund capital, provide insurance and offer escrow services.
- Empty miles: Empty miles are a burden to both the economy and the environment and present an ongoing challenge in transportation and logistics. It results in escalated fuel bills and emissions as well as unproductive driving hours that produce no revenue. However, with better insight into shipping networks through freight load matching platforms, empty miles can be reduced to save money and promote environmental sustainability.
- Product availability: In a decade where people are hard pressed for time, e-commerce sites have become a major source of convenience, to find the products that people need online and buy it in a few clicks from the comfort of their device. Similarly, in logistics there is a need for making logistics supplies available under one roof in an online platform. A digital logistics marketplace will be the ideal solution to buy and sell logistics supplies.
- Real-time visibility: In order to ensure maximize productivity and efficiency, fleet managers need complete or real-time visibility into their fleet operations. Lack of visibility is one of the major challenges in transportation and logistics and results in delays in the delivery process or might even lead to disastrous events. Utilizing a GPS tracking device and fleet management solutions can help with real-time tracking, fuel consumption monitoring, driver behavior monitoring and vehicle health tracking to improve fleet performance while also reducing costs.
- Payments: Traditional payment methods used for logistics can pose many issues, including accounting errors, lack of transparency and lengthy transaction processing times. Moreover, obtaining reimbursements can be difficult if invoices are misplaced or manipulated. However, utlising digital payment systems provided by fintech can help with quick processing of payments and a seamless cashflow.
Why is Axlerate the best solution for challenges in logistics?
Axlerate provides a unified digital logistics management platform with transportation management solutions to overcome challenges in transportation and logistics. Axlerate helps to simplify tolls, fuel purchases, fleet expenses, loans, insurance, escrow, payments, truck booking, fleet management and the buying and selling of logistics products and services.
Let’s Wrap Up!
The challenges in logistics and supply chain management results in high costs, fragmented operations and less productivity. The current global logistics issues revolve around toll transactions, multiple expenses, financial assistance, empty miles, product availability, real-time visibility and payments. However, these challenges in transportation and logistics can be overcome with technological solutions. Axlerate provides a unified fleet management platform for current global logistics issues by leveraging logistics and transportation technology backed by fintech solutions.