The COVID-19 pandemic has changed shipping in seismic ways. The ripple effects will extend into 2021 and well beyond.
Pre-pandemic, most goods followed a traditional, well-defined shipment journey — for example, from China to a shipping port to a national distribution center (DC) to regional DCs to stores. COVID-19 forced those journeys to change. Manufacturers, retailers and carriers are reacting and adapting.
As shipping continues to evolve, the new reality will demand new solutions, including the instrumentation of more vehicles and cargo to better track and optimize shipments.
Here are the shipping trends we see taking shape now.
More shipments to regional distribution centers
During the first 10 months of the pandemic, one radical shift involved the destination of shipments. With more consumers relying on e-commerce, fewer shipments went to brick and mortar stores needing to stock their shelves and more went to regional DCs as well as to stores acting as warehouses for in-store pickups and last-mile deliveries.
Demand surges in harder-hit areas caused shipping capacity issues and strained truck fleets and container ships, increasing length of haul for trucks and the number of empty loads and containers.
It could be another year or more before society gets comfortable going back into large or even small stores. And because consumers are now accustomed to buying online, traditional marketplaces may never fully return to the old normal. Retailers, shippers and carriers will focus their efforts on optimizing DC to DC shipments, along with last-mile deliveries to homes, with the help of instrumentation such as telematics units and Bluetooth sensors affixed at the point of pack.
Increased emphasis on the last mile
Retailers that turned their stores into warehouses are shipping much of that merchandise to customers’ homes, including merchandise not normally shipped to homes (think lumber, drugstore items or groceries). This reality heightens the need for last-mile delivery and may ultimately restructure the last-mile delivery industry.
Businesses that own service delivery vehicles — think of a house cleaning franchise, for instance — may pivot to become last-mile delivery carriers operating on demand, not unlike Uber drivers. They could potentially carry deliveries from multiple local companies to doorsteps, or even pick up last-mile work from an overwhelmed package delivery company such as FedEx or UPS or a third-party logistics company (3PL). These developments would force a change in how information is shared.
If a gig economy driver wants to reallocate their vehicle for last-mile delivery, they need a way to provide information back to the owner of the goods or the company that manages its deliveries. That information might include routes of the day, pickup times and vehicle capacity, plus near real-time information such as vehicle location and delivery validation.
When permanent or even temporary self-install telematics devices are installed in vehicles and paired with Bluetooth-enabled proximity sensors, location and environment data can be uploaded in real time to a platform such as CalAmp’s Telematic Cloud Platform. From there it can be sent to the customer’s shipping and logistics application (or CalAmp’s iOn application) for full tracking visibility.
A need for near real-time visibility
The challenge of shipping COVID-19 vaccines to all corners of the world on short notice has underscored the value of near real-time visibility into the journey of sensitive goods.
Rather than relying on dedicated transportation lanes, companies are being called upon to ship vaccines ad hoc as the vaccines become available and governments decide where they should go. Easy-to-deploy global technology such as battery-powered CAT-M mobile hubs and sensor tags that log location and environmental conditions will be used to provide continuity of communication throughout a shipment’s journey as it moves from carrier to carrier and continent to continent.
Versatile supply chain visibility solutions such as CalAmp’s allow for information on ad-hoc shipments to be transmitted seamlessly from anywhere in the world. Custom rules can be set up the minute the destination is identified rather than having to be pre-defined.
Monitoring of sensitive shipments
Most vaccines require cold or ultra-cold temperatures and must remain in temperature compliance during shipping. That makes a cold chain solution essential. Sensor tags that monitor temperature, humidity, light and other environmental conditions can measure and log those conditions as goods move from plane to train to tractor-trailer to last-mile delivery truck.
If sensor tags reveal that a shipment is nearing the point of compromise, it may be possible to take corrective action by repackaging it or diverting it to a nearer destination.
Airlines are currently building the necessary cold chain infrastructure to allow them to react to cold chain data in their own systems. As the pandemic winds down, the same infrastructure can be applied to shipments in other markets, including the perishable food market, which commonly lacked the profit margin to support an infrastructure build-out on its own.
On a smaller scale, fleets of any size delivering shipments from stores to homes can use sensor tags to monitor goods for tilt and shock. If a lamp is dropped or tips over in the fleet vehicle, a sensor tag can let the owner know it before the lamp is delivered broken and consumer satisfaction plummets. The record of the tilt or shock also allows the owner to file an insurance claim.
Blockchain for shipments
The next big trend, one that’s been talked about for years but is only now beginning to materialize thanks to COVID-19, is the use of blockchain in transportation and logistics. Blockchain mandates are now being included in some larger supply chain tracking RFPs.
The goal: Preserve the integrity of shipment data as goods, especially high-value goods, change hands during the journey. Among the data being encrypted is chain of custody, product acceptance, product transfer, and environmental condition records.
A digital ledger with encrypted “blocks” of data that are shared with everyone in the “chain” eliminates the need for physical paperwork and provides an authentic, automated record of transactions. This helps speed approvals and customs clearance.
As same-day deliveries continue to increase, blockchain offers a secure, scalable solution for tracking orders.
Smarter trailer vision
With more goods being shipped by more trucks, and companies under increasing pressure to ship goods more safely and economically, technology that delivers information on what’s happening in the trailer will add significant value.
Telematics devices designed specifically for trailers are game-changers. These devices “talk” to sensor tags on all parts of the trailer, including tires, brakes, cargo doors and cameras, as well as tags on the cargo, and communicate information back to the driver, fleet manager or shipper.
If the brakes start to heat up, causing a tire to catch fire, the sensors on the brakes, the tires and even the cargo can send an alert to the driver’s phone or tablet through the telematics devices on the trailer and the tractor. Alerts can also be sent if the trailer door is unlocked or open or the temperature of the cargo begins to climb.
Cargo sensors, including time-of-flight sensors and telematic video camera-enabled sensors, can determine whether the back of the trailer is full without a person having to walk around to look. This could help reduce the number of trucks deploying with half-empty trailers. Sensors can also determine whether cargo was left behind in the trailer.
Technology today, along with artificial intelligence, can allow the trailer to automatically take action on behalf of the driver, locking an unlocked cargo door or lowering the temperature of a refrigerated trailer, for example.
COVID-19 as a catalyst for change
Oftentimes, even the most negative events have silver linings. In the case of the COVID-19 pandemic, one silver lining will be the advancement of transportation and logistics ecosystems to facilitate improved domestic and global supply chain operations and increased shipment flexibility.
As companies and carriers prepare to deliver new types of goods and embrace new delivery models— adding “pop-up” fleets to boost capacity, for example — they’ll need to embrace digital transformation to stay ahead. Instrumentation of vehicles and cargo, blockchain encryption of shipment data and eventually, automation enabled by machine-to-machine communication will drive increased safety, efficiency and profitability.