Technology Trends for 3PL Companies for Better Productivity: Part 1
To match the logistical and warehousing needs of an expanding e-commerce industry worldwide, 3PL (third-party logistics) companies have started to adopt or invest in applications of cutting-edge technologies to automate their workflow. In other words, the 3PL technology trends are now closer than ever to realizing the optimal productivity goals across the logistics industry. These goals are as follows:
- Higher throughput, i.e., the number of orders processed in a given time, with minimal downtime
- Shorter revenue recognition, i.e., the gap between invoice generation, post-order processing and payment credit
- Improved workforce productivity through automation, leveraging state-of-the-art HMI (Human Machine Interface)
- Greater visibility into the workflow for an end-to-end, transparent, and compliant warehousing and logistics process
Setting the Scene: How Is the 3PL Sector Adapting to Warehousing & Logistics Automation?
According to an MHI-Deloitte study published in 2022—Evolution to Revolution: Building Supply Chains of Tomorrow—the key warehouse management solutions set to be increasingly implemented in the supply chain industry include:
- Sensors and Automatic Identification
- Wearable and Mobile Technology
- Autonomous Vehicles and Drones
- Robotics and Automation
- Industrial Internet-of-Things (IoT)
- Artificial Intelligence
- Predictive and Prescriptive Analytics
- Inventory and Network Optimisation Tools
- Cloud Computing and Storage
In this blog, we aim to discuss the following:
- The contribution of some of these technologies to warehouse and logistics workflows, we will group some of the technologies according to their core functionality
- The growth of 3PL companies is likely to be witnessed in terms of improved productivity in their operations, based on the benefits of these technologies
Let’s take the plunge!
Mapping 3PL Technology Trends on 3PL Operations for Supply Chain Optimisation
The Foundation of Enabling Workflow Automation, Real-time Visibility, & Data-Driven Decision-Making
Sensors and Automatic Identification, Wearable and Mobile Technology, and Industrial Internet-of-Things (IoT)—these capabilities listed in the 2022 MHI-Deloitte study can be broadly covered under Machine Vision, sensors, AIDC, and IoT technologies. While these technologies and their applications are not new, their use to build a synchronised suite of solutions for supply chain optimisation has begun trending due to soaring e-commerce demand, which has been:
- Testing the limits of 3PL throughput capacity
- Prompting the rise in 3PL technology investments
Discover how to make the most of your 3PL technology investments.
Logistics Automation and Warehouse Management Solutions: The Role and Impact of AIDC, IoT, Machine Vision and Sensors
Sensors and network connectivity are the common threads running through both Machine Vision and IoT. The two, featured among the top 3PL technology trends, are vital for communication between the different devices used in warehouse automation solutions, leveraging different kinds of sensors. However, the use cases of the sensor-based technologies are not limited to relaying information seamlessly across the workflow. Instead, they offer real-time visibility into the work in progress and collect accurate data at different checkpoints throughout the supply chain.
It is worth noting that some IoT-powered products overlap with those categorised as machine vision, but they are still distinct in terms of capabilities. Besides sending information from the workflow to the WMS (Warehouse Management System), machine vision products have cameras for image capture, image processing, and colour-processing sensors.
Thus, machine vision is necessary where visual data capture is crucial, turning images into actionable insights and actions. Therefore, some of the use cases of the technology include quality inspection, damage detection, identification via damaged labels, robot guidance systems, etc.
Further, a product that exclusively has IoT capabilities may have different kinds of sensors, including those that capture details such as light intensity, temperature, water level, moisture content, etc. RFID tags and GPS trackers, which logistics businesses use to track transport vehicles/containers and on-the-move conditions of the shipments in real-time, are also IoT devices that help optimise resource allocation and improve supply chain transparency with granular real-time visibility. To understand the power of IoT products—such as RFID tags—as tracking solutions, you can read our blog: Real-time Shipping Container Tracking: Do Active RFID Tags Suffice?
Some IoT products not only capture data but also help initiate and regulate actions. For example, smart thermostats and climate control devices can be used to monitor and regulate the temperature and moisture content of a container to ensure that the temperature- and moisture-sensitive shipments are not spoiled.
Machine vision and IoT products also work in tandem with AIDC (Automatic Identification and Data Capture) products, such as label (2D and 3D barcodes and QR codes) scanners. Much like machine vision and IoT-enabled products, AIDC devices also send the data to the local edge computing server or the cloud for further processing and automatic decision-making. We will discuss the role of the two data storage systems in one of the subsequent sections.
These interconnected data capture technologies in warehouse automation are critical for inventory tracking, inventory audits, dimensioning and weighing done by DWS Systems, and sorting, making supply chain operations efficient and agile.
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Workflow Illustrating the Use of AIDC, IoT, Machine Vision and Sensors for Supply Chain Optimisation
The following examples show how sensors and AIDC, IoT, and Machine Vision solutions aid a major Supply Chain Optimisation workflow:
3D profilers and load scales on the conveyor of a dynamic DWS system help measure the volumetric weight, marking a key warehouse management solutions-led step for supply chain optimisation. Then, industrial barcode scanners or Machin-Vision sensors, in case of damaged labels, scan the label on the shipment, which indicates details such as the fragility of the item, PIN code, and other details; other types of labels can also be used depending on the parcel and the warehouse management infrastructure.
The DWS system scans the shipment label before it heads for sortation. The barcode/label-encrypted information passes via the network (Bluetooth, Ethernet, Wi-fi, etc.) to the WMS, which commands the corresponding sensor in the sortation system. The sortation robot or the tilt tray pushes the shipment into the chute/bin based on the PIN code encrypted in the barcode/label.
Once the number of shipments crosses a certain depth, a sonar sensor in the chute can inform workers or an automated vehicle to carry the shipment to the designated outbound station or load the shipment onto the transport vehicle. Otherwise, another robot or set of workers may load the shipment onto the transport vehicle from the outbound station.
From 3PL Technology Trends to Implementation
Adoption Rates of AIDC, IoT, and Machine Vision & Sensors for Supply Chain Optimisation
Given that we have already mapped the following solutions to Machine Vision, Sensors, AIDC, and IoT, let’s look at the steep increase in their adoption rates, as mentioned in the MHI-Deloitte 2022 report:
- “Sensors and Automatic Identification” solutions will be more prevalent by a staggering 53 percentage points, as the adoption rate is set to go from 31% in 2022 to 84% in 2027
- Marking a sharp rise of 59 percentage points in just 5 years, the adoption rates of “Industrial Internet-of-Things (IoT)” will go from 21% to 80%, between 2022 and 2027, respectively.
- “Wearable and Mobile Technology” solutions are predicted to witness a similar spike in their adoption rate, i.e., 57 percentage points during the 2022 to 2027 forecast period, reaching a whopping 75% in 2027 from 18% in 2022.
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It is worth noting that there are significant overlaps between the three categories mentioned in the report and Quinta’s categorisation in this blog—AIDC, IoT, Machine Vision & Sensors—and in most of its communication pieces. The overall adoption rate of these three solutions appears to be over 55 percentage points (average), signaling the game-changing role that 3PL and other supply chain service providers anticipate from warehouse automation solutions and why they are gearing up to invest more in these solutions.
Embrace 3PL Technology Trends with Quinta! Our Expertise in AIDC, IoT, and Machine Vision & Sensors
If you are considering upgrading your 3PL infrastructure in keeping with the trends, Quinta can be your one-stop shop. We have worked extensively in logistics and manufacturing operations, whether it is a logistics company or the logistics department of any other sector, such as manufacturing. Hence, our experts bring to the table not just their technical savviness in emerging 3PL technology trends, including AIDC, IoT, Machine Vision, and sensors at large. They are also well-versed in logistics automation workflow and budgeting based on your 3PL investment amount.
How can choosing Quinta as your technology partner simplify your 3PL technology investment experience significantly? The answer: We do more than just procure the best solutions from top OEMs, given your operational demands and budget. We leverage our domain experience during automation consultation to help you design as well as deploy the supply chain automation infrastructure suitable for your business goals.
Quinta Powering Solutions Beyond AIDC, IoT, and Machine Vision & Sensors
Our expertise doesn’t end at the three categories of supply chain optimisation solutions mentioned in the MHI-Deloitte 2022 report that we explore in this blog: Sensors and Automatic Identification, Wearable and Mobile Technology, and Industrial Internet-of-Things (IoT). We are equally adept at the other category solution types as well.
Quinta’s portfolio includes solutions involving Robotics, Industrial PCs, Embedded box servers, etc. These products are an important part of 3PL technology trends as well as the solutions reported in the study, which are covered in Part 2 of this blog. Our consultation and implementation services include software support, such as WMS integration into warehouse management solutions.
Curious to know more? In Part 2, we have explored other solutions among 3PL technology trends, particularly robotics, AI, and cloud solutions that make warehouse management systems more physically robust, secure, and intelligent: capable of quick, centralised remote decision-making based on historical data and other data-oriented integrations.
Meanwhile, contact our experts, who will get in touch with you as soon as possible. Let’s redefine productivity with comprehensive supply chain optimisation, which encompasses logistics automation and the latest warehousing solutions!
