September 27th, 2016
Hurdles for Logistics Companies

3 Hurdles for Logistics Companies on the Road to Technological Disruption


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Commercial transportation is a difficult industry to disrupt for logistics companies. The existing complexities in the movement of goods across India have remained largely that way since decades, and printers and hard data sheets are still the go-to resources for data processing.

standards in logisticsWhile for the logistics companies the way forward shall be with technological implementations that take existing tech like GPS further with software solutions for live tracking; the real disruption shall be brought along by ground level implementations that utilise solutions like big data analytics and thereby simplify the documentation processes. Adoption on this large a scale is the key.

Why exactly is the Indian logistics sector so slow in adopting new technologies?

In India, commercial transportation in the B2B segment has always been handled with a multi-pronged method that relies not on one, but multiple points and entities for handling the responsibilities. On first look, this approach seems profitable for middlemen who are, therefore, reluctant for change. But, this has affected both ends of the spectrum.

Carriers have had to go through the multiple existent levels to get shipment contracts and spot bookings, while shippers have had make do with the absence of visibility and several transit issues.

Until Logistics Companies Work on Grassroots, Software Implementations will be Superficial

Trucking may not be the most exciting industry to disrupt from the perspective of white collar professionals who focus on interesting, enticing opportunities. But, the sheer massiveness of the sector in itself is enticing. This is further made significant by the fact that this industry is yet to adopt the technology-enabled processes in India that its counterparts in other countries have implemented. Recently, the wider adoption of smartphones in India and penetration of Internet can be considered a green signal for companies (like Quikhop itself) to educate the truckers’ community, small and big transporters, and even brokers regarding the efficiency that automation can introduce.

We believe that the target group here is not much concerned with the tech credentials of the solutions, but rather, just the extent to which the ease of doing business and cost-cutting it can introduce.

The B2B commercial transportation industry has automated itself more slowly than the car-hailing and ride-sharing industries have — almost all biddings are still traditionally handled via phones, where brokers have to make and receive hundreds of calls per day.

Ground level change from logistics companies

Conclusively,

  • Lately, the ‘Uber-for-trucks’ phrase has been thrown around a lot by logistics companies. But, the feasibility of a model that replicates Uber is extremely difficult considering the fact that commercial transportation is a much more complicated sector as compared to cab-hailing services.
  • The way different entities within the transportation logistics sector work in India, has remained largely the same over the years. Most industry entities (especially the intermediaries) are reluctant for technological change because of a simple thought process: “If it ain’t broke, why fix it?”
    However, in having that opinion, they overlook the existing inefficiencies of the sector altogether.
  • There has been a significant improvement in the sector in terms of tech innovations. Yet, there is lack of traction as drivers, small and medium transporters, and brokers will ‘adopt’ something new only if they are shown how to ‘adapt’ to the accompanied methods.

Adoption is the Key

In the trucking business, technological implementations are not just about the inclusion of high-tech equipment and virtually built software platforms. Since the industry has several ground-level problems, even new-age logistics companies that want their solutions to be widely adopted and used, need to ensure proper orientation of the drivers as well as individuals involved at every step of the logistics process.

Yes, Indian logistics companies need to get back to the drawing board and figure out a way to do exactly that — work on wider adoption of innovative and methodical approaches. Considering the fact that efficiency is significant for the eCommerce industry, the time is just right to start working.

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