The world of shipping, logistics, and supply chain management is enormous and increasingly complicated to navigate. Companies of all sizes invest in global shipping strategies to increase their reach and revenue. However, they need to navigate issues with everything from rising shipping and container rates to complex geopolitical tensions to achieve success.
Big data, combined with data science and analytics, offers an incredible opportunity for businesses to discover new, more efficient ways to enhance their shipping and logistics processes.
With cutting-edge tools and software, organizations and the carriers they partner with can extract valuable insights from huge volumes of structured, and unstructured data, using them to make intelligent decisions that boost cost efficiency, sustainability, and growth opportunities.
The Benefits of Big Data in Shipping and Logistics
According to GM Insights, the Big Data in the Logistics market is expected to grow at a rate of 21.5% between 2024 and 2032. In the logistics, supply chain, and shipping sectors, each process generates a significant amount of valuable data that can offer real-time insights into demand forecasts, inventory levels, and opportunities to boost efficiency.
Big data analysis and data science ensure that companies can conclude the data they collect, whether they’re planning routes or strategizing on how to prepare for upcoming peaks in demand.
As the ability to collect data from various resources continues to grow thanks to innovations in the worlds of artificial intelligence, automation, and IoT, the use cases for big data in shipping will evolve. Here are some insights into how big data can optimize the shipping and logistics processes.
- Improve Shipping Planning Decisions
While the market for cross-border shipping and logistics is continuously growing, navigating global shipping strategies is far from easy. Companies need to deal with complex customs regulations, endless documentation, and rising global tariffs.
Fortunately, partners offering access to analytical tools, resources, and big data insights can assist businesses in making more cost-effective decisions. For instance, with insights into shipping costs and potential delays for different fulfillment routes offered by a freight forwarding platform, companies can make intelligent decisions about their container needs.
For example, businesses may choose LCL shipping services to keep costs low and maintain consistent inventory during periods of lower demand. Or, businesses can choose FCL shipping during times when container costs drop, to prepare warehouses for future peaks in demand.
- Route Optimization
Route optimization is one of the most complex challenges to overcome in the logistics and shipping space. Determining the best routes possible for a shipment isn’t just about finding the shortest path from A to B. Product data, vehicle information, GPS data, and weather forecasts are all involved in calculating the most cost-effective and secure route for each shipment.
Big data and analytics tools in the logistics sector allow carriers to combine all of this information to determine how to optimize routes for both product and driver safety, as well as cost management. Additionally, data on fuel consumption and driving behaviors captured from vehicle sensors can help businesses to gradually improve their routing strategies over time.
Sensor-based insights can even assist businesses in finding ways to reduce fuel consumption, reducing both transportation costs, and carbon footprints.
- Stock and Inventory Management
Tracking stock and inventory data is crucial for all types of companies to ensure they can adhere to changes in market demand, avoid stockouts, and maintain profitability. Analyzing the data gathered from systems, sensors, and software can help businesses determine when to contact suppliers and adapt to changing patterns of incoming orders and requests.
Big data analysis in shipping and logistics can also help businesses more effectively manage warehouses and teams. With effective data collection tools, organizations can access a comprehensive view of their operations, identifying inefficiencies that could lead to delays and bottlenecks.
This improves a company’s ability to adjust their staffing and warehouse management strategies to adhere to evolving customer expectations and keep operational costs low.
- Capacity Planning and Risk Reduction
The success of any shipping or logistics strategy depends heavily on your ability to access the right vehicles, containers, storage space, and personnel. However, it can be difficult to “plan ahead” when demand is constantly changing. Big data analytics provides companies with an intuitive way to analyze historical trends in resource allocation and predict future needs.
With the help of AI-powered analytical tools, companies can identify exactly what kind of resources they’ll need to prepare for seasonal trends and market disruptions. They can even use their systems to match machines, vehicles, and solutions with staff members.
This helps companies to remain agile and prepared in a flexible landscape, while also reducing risks. Insights into recurring issues with past processes ensure businesses can take proactive steps to mitigate problems. For instance, if an analysis finds that a company wasted time, money, and resources by failing to invest in the right number of staff for their warehouse in the past, they’ll know they need to invest in additional human resources going forward.
- Improving Customer Experience
Finally, big data and analytics have the potential to help companies enhance the customer experience in various ways. Companies can leverage insights from their ecommerce platforms, warehouse management, and supply chain tools to learn more about customer preferences, expectations, and pain points, allowing them to adapt future strategies to exceed customer requirements.
Big data also allows companies to provide their customers with access to valuable, transparent data. Through GPS devices, bar codes, and RFID tags, logistics companies can capture real-time shipment data for packages in transit, allowing companies to share that information with consumers.
Business leaders can then offer consumers a transparent way to track their goods and keep them informed about potential delays and disruptions in the supply chain. This approach can lead to increased consumer trust, loyalty, and retention.
Big Data: Shaping the Future of Logistics and Shipping
The logistics and shipping landscape is a data-intensive space, generating more valuable information and data points every day. In the past, companies have struggled to take full advantage of that data to drive their decision-making efforts and processes.
However, as advanced analytical tools, IoT systems, sensors, and software evolve, data is becoming more accessible to the masses. Going forward, both business leaders and logistics partners alike will find ways to unlock more value from their data, improving the performance and quality of global shipping strategies.
