IoT analytics

How IoT Analytics Are Boosting 3PL Performance

Categories: BCO/Shipper.

Consumer applications for Internet of Things (IoT) technologies seem to get most of the media attention, but the real potential of connected devices and sensors is on the business side. Enterprise deployments of IoT technology have grown by over 300 percent in recent years, and supply chain management is one area where the benefits of these systems cannot be overstated.

By collecting large quantities of useful data, IoT devices allow third party logistics providers to leverage this information to improve their performance. IoT analytics can lead to more efficient routing, more precise inventory management, and greater visibility for business partners and customers. They help to improve the quality of logistics services while lowering costs.

In addition, predictive models derived from these analytics can help prevent disruptions to the supply chain before they occur while also providing actionable intelligence to business partners about the best ways to handle customer service. The ultimate effect is to greatly increase the efficiency and speed of 3PL services while also providing more transparency. Let’s take a closer look at a few of these performance enhancements.

More Efficient Intermodal Transportation

IoT-enabled technologies yield more accurate tracking of assets across transportation modes, and the data collected from this process enables both real-time and ongoing improvements to the movement of goods. Applications can be as simple as re-routing goods mid-trip to address shifting inventory needs, yet these still produce outsize financial benefits.

Real-time tracking is another core benefit of IoT that allows greater visibility into the entire supply chain process.  Data from IoT devices can help determine how effective each mode of transportation and route is at meeting delivery times. This data can be compiled and analyzed to identify trends and use the insights to develop customized, time-saving routes. 3PL providers will be able to leverage economies of scale along with these advanced analytics to provide improved performance.

Analytics derived from this technology also allows 3PL providers to create unique transportation solutions that help them differentiate themselves from competitors. Data about where goods are going combined with systems that show available carriers enable last mile LTL delivery options. Conceived of as a kind of Uber for goods, this process allows 3PL providers to further customize transportation of goods. Providers can cost-effectively separate shipments over a greater number of trucks in order to get goods to disparate locations faster.

Improved Transparency and Quality Control

More accurate tracking, made possible by IoT devices, allows more precise and regular collection of location and condition information about goods mid-shipment. Better tracking allows 3PL providers to provide customers with more precise information, which can be essential for customer service.

Just like consumer IoT devices can help homeowners improve the efficiency of their climate control, IoT sensors can help improve quality of service in 3PL. Monitoring devices can keep track of temperatures to ensure that goods are being transported and stored within the required conditions. For fragile goods, IoT analytics can help determine which transportation routes that provide the highest likelihood of damage. This can allow 3PL providers to reroute such goods to avoid such outcomes.

All of these measures can also help 3PL providers determine likely culprits of any quality problems that occur. If goods are damaged by excessive heat, IoT temperature monitoring devices can help pinpoint the time and location that the damage occurred in order to establish liability.  Eventually, many of these processes will be automated. Goods will be transported in ways to minimize damage and kept at an ideal temperature.

A Better Customer Experience

IoT technology use in warehouses and fulfillment centers can provide granular, real-time data about inventory. When this data is analyzed, it can help to identify seasonal fluctuations and potential shortages. 3PL providers will be able to better understand the demand for goods through supply chain analysis, and offer their partners greater visibility into their own operations. This can lead to changes in imports or manufacturing capacity in order to ensure that inventory levels are closely pegged to demand.

Real-time collection of information also allows businesses to respond almost immediately to customer requests or any problems that arise. It can even spot defective goods before they cause a more severe customer service problem. For example, if a particular product had a quick increase of returns or help requests, it could be flagged to prevent more defective goods from going out. Order fulfillment for this particular product could be rerouted from another warehouse.

IoT-driven analytics combined with big data processing techniques provide greater insight into the cause-and-effect relationships within 3PL. This allows providers to develop advanced predictive models that can speed intermodal transportation, improve inventory management, and increase both transparency and efficiency across all processes. All of this will revolutionize supply chain management over the next several years. Logistics providers are increasingly able to make decisions based on timely and well-organized data, and these choices can improve the bottom line for them and their partners.

If you need a partner to help you strategically manage and successfully move your products out of the port and onto their final destination, be sure to download our ebook - Speeding Time-to-Shelf and Cutting Costs- a must read for today’s logistics managers.