Redefining Logistics using IoT

This article was published on : September 21, 2019

With the dawn of Internet of Things (IoT) and its applications to streamline the logistics and supply chain sector, a sea of changes is set to happen as companies have started making use of and benefiting from the opportunities brought ahead through IoT-based solutions.

Markets spanning from agriculture to manufacturing have challenges at each step- from production to delivery of goods, raw materials and everything that can break an entire supply chain. To solve the challenges faced by the logistics and supply chain management sectors- IoT is one beaming solution. As per a 2018 report by Supply Chain Resilience, supply chain disruptions have increased since 2017, going from 70 percent to 73 percent, and overall most organizations have consistently shown a growing level of reporting over previous years (68 percent on average). The increasing demand for logistics across industries and the widening gap between distribution and division of labor and goods across the world has turned logistics into an essential component of todays’ world.

Till very recently, it was all about using IR technologies and similar infrastructure when it came to logistics. Technology has always divided the logistics and supply chain. However, with time, logistics, supply chain companies have brought up technology that will gain acceptance as a viable outsourced model.

Any logistics company is successful when it moves the right product in the right quantity and condition at the right time and right location with the right price to the right customer. This is termed as the 7 R’s. Given the complexity of the task at hand, there is an increasing demand for making use of innovative solutions to achieve goals.

One of the biggest potential uses for IoT devices is tracking devices for goods and components across the supply chain. Using this technology, tracking no longer must be done manually—or at all—and can instead be done through digital sensors keeping tabs on materials or products throughout the entire supply chain from start to finish.

These kinds of tracking systems are already seeing widespread use in several other transit-based industries like consumer package delivery. By taking advantage of them in a logistics setting, organizations can push delivery times, bring transparency to the logistics process, and keep a closer eye on the goods being transported along the chain.

The Internet of Things (IoT) offers a powerful solution to traceability problems: asset tracking. An emerging technology finding more and more applications each day, IoT brings meticulous component tracking and data acquisition tools that aren’t possible using traditional manual tracking methods. The potential applications for these tools are nearly limitless. With the wealth of information being provided by these IoT devices, even more improvements should be possible soon.

Location Tracking by IoT

Real-time location systems (RTLS) can be used to track pallets of this component from every vendor, from the time the pallets are packed until the time they enter the manufacturing unit.

Environment Sensing using IoT

Some factories regularly receive shipments of perishable or sensitive goods that only stay fresh for a short time, and/or require specific environmental conditions to maintain quality. IoT can help you monitor the humidity in the storage area, the temperature of the product, and the shock and vibration levels these items experience during shipment.

Current Challenges

The transportation and logistics industry is undergoing major challenges today and may face many more tomorrow. The demand for real-time transparency and accountability has increased over the past few years as the market for transportation and logistics keeps growing.

Today, blockchain and IoT technologies continue developing and need to be adopted by the transportation and logistics businesses to support the challenges they are facing. The future of combining blockchain with IoT would be able to help different stakeholders of, not only the transportation and logistics industry but other industries as well. Technology providers are coming up with different use cases for every industry, and interest in investing in these technologies is growing.

Lack of transparency is a serious hurdle for supply chain monitoring. Globally, logistics players have had a hard time working on delayed data which is also most of the time falsified. Though technology today is advanced, numerous companies receive data about the transport of their goods days or even weeks after their goods were delivered at the destination. Consolidating the huge amount of data, in fact, is a tough task and resolving any issues within the supply chain is nearly impossible as it’s hard to pinpoint exactly where and when something went wrong.

Fraudulent imitation is something that has been bothering the industry for a long time. Falsely labeling a product with that of a different brand, making use of degraded components to manufacture a product and other similar methods are applied by outlaws who pose a threat to the logistics sector.

Theft is another challenge that tests the patience of manufacturers. It is very difficult to figure out where the theft may have occurred. Most of the times the information about a segment is accessible only after the products have been delivered. Products from the food, beverage or mostly from the FMCG category are transported within pre-set environmental conditions, such as within certain temperature parameters. It is not possible to monitor the temperature and other parameters in real-time. There is another possibility that some logistics companies tend to give inaccurate information on how they’ve shipped certain goods.

With IoT, trucks, warehouses and ships can relate to the use of the internet and report on GPS and environmental conditions, such as temperature, humidity, and pressure. A few logistics players have started making use of IoT’s that report those conditions back to manufacturers.

Change management was earlier a challenge that has been slowly withering away. The only way to change is to change the mindset. The traditional and orthodox nature of the logistics industry kept it from growing as fast as other industries and change management was one of the major causes.

The logistics providers that report data back to the manufacturers while the goods are in their care do so through their reporting mechanisms. This means that there is still a high level of trust required from the manufacturers as it’s in the logistics provider’s best interest to not report on any issues while they’re in charge of the products.

Future of Logistics in India

India has become the prime destination for logistics service providers all over the world. The demand for logistics services in India has being largely driven by the growth of the economy. The growth is projected at 7-9% in next few years, with the Compounded Annual Growth Rate (CAGR) expected to grow at rate of 7-8%. This growth is expected to gain greater momentum due to exponential growth of the Indian economy.

India is also experiencing a big retail boom as the buying capacity of the middle and upper middle segment of the population have scaled new heights. Many large MNCs from the retail industry are planning to set up operation in India and large local retailers are also planning to expand their operations.


The world of logistics has now been exposed to a vast pool of smart physical devices, those which are built with supremely high-definition technology and are well-designed to communicate with each other over the Internet. Interestingly, the number of these IoT-enabled devices has been increasing at a fast pace and is forecasted to reach up to 30 billion by 2020. IoT players believe that this is a great market for the logistics and transportation companies to flourish. Right competition mix, right demand matrix and the best technological landscape has fueled the growth of this sector which is around CAGR 10.5% year-on-year.

On a global scale, new digital infrastructures will be required to enable physical and digital services to create “smart services.” Internet of Things will unlock the doors for end-to-end customer satisfaction and will successfully optimize supply chain responsiveness.

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