Emerging technologies like 5G, the Internet of-Things (IoT), artificial intelligence (AI), and blockchain are already having huge impacts on logistics and supply chain management and are set to further revolutionize these industries.
In this blog post, we’ll explore how emerging technologies in logistics and supply chain operations are improving efficiency, security, and decision-making, and how your company can take advantage of them to stay competitive.
The future of logistics is moving beyond conventional industrial engineering to advanced communications technology. The best example is 5G, the fifth generation standard for wireless communication.
China has already deployed the largest 5G network on the planet, developing, in the process, over 100 5G-enabled manufacturing benchmark software applications, including the 5G+ industrial internet app.
These advancements will have a huge impact on advanced logistics, allowing it to reach entirely new levels of intelligence, flexibility, service, and quality. With 5G, manufacturers will have the capability to create fully-automated smart warehouses, automating sorting and transfer, as well as inbound and outbound logistics management. 5G connectivity will also make it possible for workers to use augmented reality applications, greatly improving processes for product sorting and reviewing.
5G connectivity also enables fully-automated transportation, including automated driving or smart driving vehicles.
Transportation systems already use 5G for terminal communication between transport vehicles and logistics applications in the cloud. Further implementation of this technology provides the necessary bandwidth for self-organized network construction, real-time information sharing, and mass transmission of logistical data.
The Internet of Things (IoT) refers to networks of interconnected devices that exchange data via the internet. Household devices like smart speakers, cars, refrigerators, and even light bulbs are becoming IOT components.
In terms of logistics and transportation, IOT technology enables inter-vehicular networks, sometimes called the internet of vehicles (IOV). These networks transmit data to support remote fleet management, giving dispatchers and expediters the chance to make decisions in real-time with instant, reliable information. The result is safer, more accurate, and more efficient product delivery throughout supply networks.
Chinese shippers currently install sensors – such as radio frequency identification tags (RFID) and GPS trackers – in facilities, on products, and aboard vehicles. Using the internet, systems will be able to provide real-time updates on inventory, vehicle performance, driver behaviour, and traffic conditions.
IOT technology also provides improved data capture and analytics, eliminating information silos within supply chains. The increased use of data analytics – with real-time updates – will have a substantial impact on the bottom line, helping to improve predictive maintenance of vehicles, containers, and related equipment. Proactive upkeep reduces downtime and extends equipment lifecycles, lowering long-term logistics costs.
According to Stanford University’s AI Index, China ranks among the top three countries in terms of global AI vibrancy, and the country’s advanced AI systems will play a vital role in its logistics management.
As we’ve discussed in the past, China has developed a vast transportation network of advanced railways, highways, seaports, inland waterways, and civil aviation routes. Adding IoT systems to this network can generate massive data volumes, enabling cutting-edge AI technology to support fleet management in ways that would have once seemed incomprehensible.
AI-driven fleet monitoring systems, which can track vehicle locations, conditions, trips, and routes, have already proven to be more efficient than conventional methods, reducing fuel and maintenance costs by as much as 15 percent.
Artificial intelligence also helps China’s warehouse facilities forecast demand. By applying data mining techniques, storage facilities can project future demand trends more accurately, improving inventory management.
The media often mistakenly conflates blockchain with cryptocurrency, giving it an undeserved aura of sketchiness. The People’s Bank of China (PBoC), however, has made the distinction clear: cryptocurrency is illegal in the country, while blockchain has served as the foundation for a number of sound applications.
In fact, blockchain provides the framework for a central bank digital currency (CBDC). This sound, fully-backed legal tender is called the e-Chinese yuan, or e-CNY. The e-CNY pilot has been ongoing for two years and involves at least 26 large cities and 5.6 million businesses.
Blockchain is also seen as a vital tool in the effort to modernize supply chain logistics, making it more transparent and secure. Blockchain, after all, is centered on distributed digital ledgers, where data is neither centrally controlled or alterable. Its distributed security meanwhile, can streamline processes to reduce costs and ensure secure, reliable data exchange throughout the supplier network.
Potential blockchain applications could provide updated data on every container’s location along with estimated arrival times. The technology can also establish smart contracts, set deadlines, and monitor quality standards for shipments while expediting payment processes.
Chinese robotics developers have experienced annual growth of over 40%, and the country has tripled its robot production since 2016. It is now the largest and fastest-growing industrial robotics market in the world, exporting more robots than the United States.
China’s role as a robotics leader is having an impact on the country’s manufacturing sector, as robots are now being used to automate repetitive tasks like picking and palletizing, boosting warehouse productivity and efficiency.
Chinese warehouses are also now leveraging cutting-edge robotic storage and retrieval systems to sort and separate tasks, further elevating the country’s logistics sector.
By harnessing the advanced robotics readily available in the country, China has established itself as a global leader in logistics efficiency, flexibility, and productivity.
Augmented and virtual reality tools use digital glasses, tablets, or smartphones to superimpose digital plans and drawings on real-world visual environments. The Chinese government has designated AR and VR as key industries in its latest five-year plan, with a goal of nurturing 100 companies to ship 25 million devices by 2026.
In China’s advanced logistics applications, AR technology provides an effective training tool and helps warehouse workers navigate complex warehouse environments. As an example, AR applications have been shown to improve product picking efficiency by more than 15%.
China's forward-thinking warehouse managers, meanwhile, are utilizing AR and digital twin technology to streamline planning, improve asset management, and effectively solve problems. Additionally, the use of digital twin technology allows for real-time simulation and testing of various scenarios, providing valuable insights for decision-making and continuous optimization.
China’s innovative, sophisticated logistics and supply network sets it apart from other potential offshore manufacturing locations. If you’re looking to maximize your business’ growth, there has never been a better time to partner with Chinese contract manufacturers.
Kingstec has worked with China’s leading facilities for over 40 years and can help your business navigate this dynamic, fast-evolving market, acting as an extension of your mechanical and electrical engineering, design, and logistics departments.
Call us today to learn how your business can partner with China’s world-class, cost-efficient manufacturers.
