Great challenges for the distribution sector

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Business

Tools such as Big Data, the Cloud, or, more recently, the Internet of Things (IoT), are presented as very attractive and relevant technological solutions and supports in the field of logistics.

New technologies are opening the way to a large number of new opportunities in a multitude of fields, and distribution is one of the sectors that is expected to benefit the most from these new developments. Tools such as Big Data, the Cloud, or, more recently, the Internet of Things (IoT), are presented as very attractive and relevant technological solutions and supports in the field of logistics.

These new techniques have enormous savings potential in the supply chain, so it is expected that, over time, investment in this regard will increase, driven first by large logistics operators (that is, those whose core business consists of offering logistics services), and followed, later, by smaller players and even by other entities that, without specifically dedicating themselves to distribution, become aware of the advantages offered by these new systems and incorporate the technologies into their supply chains. supplies to add value to your business.

And it is that the benefits of new technologies can achieve (and are already achieving) that many of the logistics processes – in each of their levels – are much more efficient.

Broadly speaking, it boosts the speed and efficiency of supply chains, promoting (through industrial automation) the reduction of time and cost savings. It also allows greater traceability and control of products and improves the sales experience.

If we study the effects caused by the incorporation, for example, of the IoT into the aforementioned processes, we can see that they are deployed in each of the stages of the distribution process, from warehouse management to tracking, protection, and control of items, or transportation. In the first of these steps, to mention some benefits, it allows collecting more precise information on products, being more efficient in terms of energy consumption, detecting errors more quickly and reliably, or improving time management, increasing productivity. and distributing tasks in a more balanced way. The fact that the devices are hyper-connected also helps to prevent damages and tares in the products, facilitating the control and detection of errors through mechanisms such as temperature control,

Another challenge that this mechanism assists with is transportation, helping to determine issues such as the shortest and most efficient routes, or providing specific information related to the resources available in the fleet. With all this, we can obtain significant advantages in terms of efficiency, productivity, sustainability, and cost reduction.

As we can see, the applications of new technologies (and specifically, as we have seen, of IoT devices, are very varied). The interconnection of goods, warehouses, processes and systems, infrastructures, and means of transport contributes to the digitization of the distribution sector and establishes a new paradigm in the management of supply chains and logistics. Although the percentage of companies that use this type of new technology and the number of devices connected to the internet is still small, the penetration of this type of element is destined to increase at a very high rate (as it is already happening).

These transformations, however, are not without certain risks and pose a series of challenges. Added to this incorporation of technology is an increase in the need for transparency linked to the control of the elements that make up the supply chain, both from the consumer side, as well as from the logistics providers.

On the other hand, increased connectivity and the increased presence of sensitive data on the network or in the cloud make companies more vulnerable to cyber attacks that target or affect crucial areas of the business. Logistics entails inherent mobility that is at odds with the classic perimeter security approaches, being a sector that can benefit from the use of virtual private networks.

Success or failure in incorporating these new technologies will depend on the correct management of these types of cases and on how to face the set of challenges that the new systems pose, and with it, predictably, the business as a whole.

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