In the supply chain, you can apply the Internet of Things (IoT) to processes throughout the product lifecycle. Using sensors, you can track your goods from the raw materials warehouse to the retail store and beyond to improve supply chain visibility.
What does next generation supply chain visibility IoT technology offer? First, your visibility can be down to individual goods, such as at the SKU level. Second, you can have direct access and control over data about the status of your goods. Last, you can have more accurate forecasting with predictive analytics for inventory and schedules.
For example, what would you do if one of your reefer containers went out of service, resulting in spoiled goods inside? If you could leverage the IoT, you would be able to track your container’s condition, such as its location, temperature, power status, and atmospheric conditions. If anything went wrong, you would find out quickly and be able to minimize your risks and costs due to supply chain disruptions.
IoT technology can elevate supply chain visibility in four key aspects: demand sensing, optimization, monitoring, and customer service.
1. Demand Sensing - Most firms rely on historical data to forecast the goods and services they will need in the short-run. However, historical data only provides a look back at what has happened and may not be relevant to what could happen in the future. Demand-driven planning is a more reliable approach because it uses real-time demand information. Companies can analyze customer-demand data to make timely decisions about replenishing stock. Leveraging the IoT, you can track inventory levels of individual items and arrange replenishment in time to avoid out-of-stock situations. You can also identify the best routes and delivery schedules based on the IoT data.
2. Optimization - Often, you have visibility down to the shipment level but not for warehouse and logistics planning. By leveraging the IoT, you can have visibility down to the SKU. You can track and trace not only vehicles and shipments, but also individual items along the entire supply chain. This way, you can optimize stock levels in warehouses and stores to save costs. The IoT also helps you improve the operational efficiency of production and logistics with better coordination between different supply chain parties. You can also react in a timely manner to live incidents to minimize risks, such as port congestion and traffic accidents.
3. Monitoring - With the IoT, you can access shipment information firsthand and use analytical tools for insights about your shipments. You can also provide partners with end-to-end visibility across the supply chain. You will be able to see and understand the activities and events of multiple players in the supply chain and provide timely alerts to notify customers of delivery dates, times, and any changes. You can also closely monitor the performance of suppliers and carriers to maintain supply chain excellence.
4. Customer Service - Currently, you may not have comprehensive data on how customers are using your products to improve your service. With IoT, you can gain a very clear picture on when, where, and how many products customers have purchased. You can then make timely decisions on how your supply chain should react. You can also track usage patterns with analytical tools to improve product design and production. Furthermore, based on customer usage and behavior, you can predict their needs and provide personalized products and services.
Filling visibility gaps with the IoT
One example of leveraging IoT to improve supply chain visibility is by augmenting sailing schedules. Sailing schedules change frequently. In fact, from July to September 2017, there were on average 5.4 changes per schedule among 29 major ocean carriers’ global schedules and 43% of the schedule changes were over 24 hours.
In Europe, the average changes were higher than the global average, with 6.1 changes per schedule and 49% of the schedule changes were over 24 hours. Taking a closer look at the top three Europe container ports, Antwerp had the highest average changes with 7.4 changes per schedule, while Rotterdam had the highest percentage of schedule changes with 49% over 24 hours.
Average changes per schedule and the percentage of schedule changes over 24 hours from July to September 2017 (Source: CargoSmart)
To keep your supply chain running smoothly, it is important to stay informed of schedule changes. Leveraging IoT technology, CargoSmart monitors the live movements of 7,000 container vessels, analyzes over one million live vessel status updates each day, and monitors incidents that may impact vessel schedules each day. CargoSmart offers solutions such as its Schedule Delay Alert to supplement carriers’ actual times of arrival and departure and to notify customers by email and APIs of schedule delays that may impact their shipments. Shippers are able to leverage the IoT to save time looking up schedules to monitor critical shipments, improve shipment visibility to vessel status and delay information, and respond faster to potential supply chain disruptions.
Businesses are devoting more resources to the IoT. Has your company started? Take the opportunity to leverage IoT technology to boost your supply chain visibility. We invite you to learn more about CargoSmart’s tools that leverage IoT technology to help you boost your supply chain visibility.