Digital Logistics Market
The global digital logistics market size was more than US$17 Bn in the year 2021. With unprecedented penetration of digitisation and automation in logistics and warehousing, it is anticipated that the market will experience stupendous growth in revenue over the upcoming years.
Market Analysis in Brief
Digital logistics is more popularly understood as the automation and digitisation of procedures involved in the movement of goods. Routine logistical operations that typically rely on pen and paper, and repetitive manual effort hold the largest potential to be subject to automation, and digitisation. This is where digital logistics comes into play. According to NITI Aayog, the Government of India emphasized IoT, AI, and Big Data in 2019 to overhaul the country's supply chain and logistics business, spending 100 crores in Indian Rupees in the field, which is boosting the country's total need in the digital logistics market space. The demand for cost-effective logistics and supply chain solutions is setting the stage for the digital logistics market. In addition, the market for digital logistics will receive an impetus from the rapidly increasing need for fleet and warehouse management systems.
Some of the other significant factors driving the expansion of the digital logistics market include evolving data analytics technologies and tools that logistics companies are rapidly adopting, growing penetration of the e-Commerce industry, and enhancement of delivery capabilities using drones and digital trucks for carrying out shipments. Furthermore, digital logistics plays a catalyst in improving communication among the various internal and external stakeholders while decreasing the data silo effect, and creating profitable potential for business growth.
Key Report Findings
Brisk e-Commerce Expansion
Over the last decade, the rise in online purchases and the number of Internet users has fuelled the e-commerce industry's exponential expansion. This bodes well for the performance of digital logistics market. Given the upsurge of e-commerce activity, the logistics providers ought to work faster and more efficiently to be able to cater to small individual demands. Online shoppers expect order accuracy, same-day or same-hour delivery, and free returns. The e-Commerce companies are seeking reduced order delivery times and operational costs.
The e-Commerce sector drives transparency, cost, convenience, and speed in delivery, as well as appealing frictionless returns. To address this need, new business models and solutions must be developed based on digitisation of logistics operations, automating material handling systems, warehouse management systems, and distribution management systems. This has resulted in speedier and more diverse fulfilment services, particularly in terms of last mile delivery alternatives and smooth returns processes.
Rising Demand for Fleet Management Systems
There is an increasing requirement to control the rising logistics and supply costs because of the globalisation of supply chains and freight logistics. Different freight organisations can efficiently control a range of costs by utilising intricate digital logistics solutions for labour, transportation, fleet, and warehouse administration. Therefore, during the forecast period, the globalised supply chain and freight logistics are driving up demand for warehouse and fleet management systems, among other products.
Fleet management tools used in commercial vehicles are progressing technologically and are likely to increase at a higher rate during the projection period. The rise of linked automobiles is likely to promote key activities of the digital logistics market growth. The worldwide fleet management market is still in its early stages of development. The fleet management market is being propelled by an increased awareness of the benefits of fleet management systems in fleet enterprises. The use of new technology during the industrial revolution has also contributed to the rise of fleet management.
Lack of Standardisation in Fragmented Logistics
Lack of governance is one of the biggest growth barriers in terms of the mainstream adoption of digital logistics. A logistics IoT standard must be established due to the highly fragmented nature of the logistics industry. To sustain revenue and viability, international transportation and logistics companies are concentrating on improving supply chain management and efficiency. Keeping governance as uniform as possible is essential because having one authority for each field would require clarification.
On the other hand, high performance would lead to end-to-end improvements in both linked devices and integrated systems. Connectivity standards facilitate data transfer as MTConnect, EtherCAT, and Master Control System-Distributed Control System (MCS-DCS) Interface Standardization. The bulk of solutions could easily be delivered by each service provider in a single bundle thanks to a standardised logistics and supply chain infrastructure.
Overview of Key Segments
Cloud Segment Continues to Grow Prominent
Based on the deployment model, the cloud segment of the digital logistics market is likely to grow faster in the upcoming years. Various enterprises all over the world are leveraging cloud-based solutions and apps. The main advantages of cloud services include their flexibility, capacity to grow their applications, and simple management capabilities. The use of cloud services among SMEs is due to strong rivalry and the need for more resources seen in large organisations.
On the other hand, large organisations are cost-conscious about these solutions, prompting them to boost their use of cloud-based software. Because of cloud-based services, digital logistics solutions are delivered in a customised manner based on business requirements, resulting in higher customer satisfaction.
Solutions Remain Sought-after with Increased Demand for Data Management
Based on the analysis of the digital logistics market based on components, the solutions segment is further divided into asset management, warehouse management, data management analytics, security, and network management. Data management solutions enable IoT devices to collect massive amounts of data and extract insights from raw data, thereby improving industry efficiency. As a result, manufacturers provide data management solutions to manage structured and unstructured data to extract insights from large amounts of data.
Data management operates in six steps, viz., data identification, data gathering, authentication, storage, analysis, and information generation for decision-making. With the help of advanced IT solutions, this data might be converted into critical information and insights, resulting in increased efficiency, production, and profitability for enterprises. A real-time loT analytics solution influences remote management and monitoring while also gaining insights from faraway devices. It also detects data irregularities and generates error alarms.
Growth Opportunities Across Regions
Asia Pacific Dominant Market with High-growth Economies
On account of the inclusion of high-growth economies like China, India, and the Philippines, the Asia Pacific region registered the largest share of the digital logistics market in 2021 and will retain its primacy over the projected period. Low market entry costs, lesser risk, relatively easy and cheap market expansion, and rapidly growing accessibility of the latest technology mark only a few advantages of the data logistic systems for Asian markets. The logistics industry today contributes notably to the economic growth of Asian frontrunners like India.
A strong logistics industry is anticipated to significantly aid India's efforts through programs like the government-sponsored Make in India initiative. Furthermore, a unified production base is sought after by many essential actors. The industry has experienced tremendous expansion with the government's increased projected spending, improved infrastructure, and improved access to international markets. Because of its strong economies, Asia Pacific continues to be a growth engine for industries.
Global Digital Logistics Market: Competitive Landscape
A few of the digital logistics market participants include IBM, Oracle Corporation, SAP, AT&T, Intel, HCL Technologies Limited, Huawei Technologies Co., Ltd, Honeywell, and Blue Yonder.
Regional Classification of the Global Digital Logistics Market is Described Below:
Middle East and Africa
*Regions and countries are subject to change based on data availability
Key Elements Included In The Study: Global Digital Logistics Market
Post Sale Support, Research Updates & Offerings
We value the trust shown by our customers in Fairfield Market Research. We support our clients through our post sale support, research updates and offerings.
Considering the volatility of business today, traditional approaches to strategizing a game plan can be unfruitful if not detrimental. True ambiguity is no way to determine a forecast. A myriad of predetermined factors must be accounted for such as the degree of risk involved, the magnitude of circumstances, as well as conditions or consequences that are not known or unpredictable. To circumvent binary views that cast uncertainty, the application of market research intelligence to strategically posture, move, and enable actionable outcomes is necessary.View Methodology