Transport, logistics , IoT, pricing, software, e commerce

4 Key Transport and Logistics Challenges For 2021

4 Key Transport and Logistics Challenges For 2021. Every year has its unique plot twists and 2021 isn’t any different. For transport and logistics, some of the challenges that should be expected in this sector will be partly spillover issues from the last year’s economic upheaval.

There would be challenges arising from the increasing adoption of essential technology to aid fast recovery from the pandemic losses. Many logistics companies are also going to focus on pricing as an important driver in boosting their bottom line.

In the coming paragraphs, we provide an in-depth look into four key challenges logistics providers should watch out for in the next 12 months.


Rise of eCommerce

The unprecedented boom of eCommerce in 2020 has placed a great pressure on the already-stretched labor supply in the logistics industry. What makes this issue even more of a challenge is that this trend is showing no signs of going down in 2021.

In spite of countries easing lockdown rules, consumer behavior continues to show a high preference for online shopping. The trend can be attributed to several factors:

One is the increase in remote workers, people staying away from crowded places due to safety concerns, and also the rise of elderly consumers growing accustomed to purchasing products over the internet.


Lagging Sophisticated Pricing Systems

Compared to several other industries, logistics has a somewhat lagging sophisticated pricing system. This is very unfortunate because of all existing improvement levers, the one that has the fastest and greatest impact on revenue is pricing.

Normally, without any extra help from other improvement levers, improving your pricing strategy alone can increase the revenue of your logistics business from 2-4%. An increase that translates to approximately 30-60% margin improvement (or higher operating profit).

There is no doubt that last year’s global crisis negatively impacted pricing across most sectors. Notwithstanding, even with the uncertainties surrounding prices, by implementing a strategic and analytics based pricing transformation, your work team should be able to generate positive returns for your transport company.


Rise of Artificial Intelligence (AI) and Internet of Things (IoT)

AI and IoT are not exactly new kids on the block in the logistics environment. They’ve been around for a while, but they are not as predominant as they should be.

Companies such as DHL that are ahead of the curve, have been using AI for some time now to reduce their overall margin and at the same time optimize their total service output. They do this by using AI to process their huge supply chain data. The result is then sent to the appropriate department to guide the various work teams in making accurate data-led decisions.

Internet of Things too has been proving relevant to many logistics companies. Its most common use is in planning, monitoring, and increasing security of daily operations.

For example, IoT technology is what logistics managers use to monitor deliveries and reduce theft. It is also the same thing that enables consumers to track the journey of their goods from the warehouse down to their doorstep.


There may be an ongoing wariness about the safety of 5G, but with rising awareness and adoption, this will ease.  Experts in the industry are even predicting this new technology could very well be the one to push logistics companies into full digitalization.

A study conducted in 2020 showed that by 2035, the 5G wireless network could open up a $13.2 trillion opportunity in logistics. In addition to that, 22 million new jobs are estimated to come with the rising use of this technology.


Take advantage of the technology disruption to a build a resilient profit for your transportation company.


If you want more information on how to boost profit for your transport company , don’t hesitate to contact us.


4 Key Transport and Logistics Challenges For 2021

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