Top 10 Smart Logistics Trends to Look Out for in 2022 — (Part II)

Continued from Part I

6. LPWAN Powering Next Generation Communication Technology for IoT Application

The Internet of Things (IoT) technology increases the visibility of logistics processes, accelerates industry-wide digital transformation, and has huge application potential across the logistics industry. However, lower cost and longer battery life have always been the primary consideration of IoT system architecture.

Here, LPWAN (Low Power Wide Area Network) serves as a new generation of underlying communication technology for IoT, promising longer information transmission distance and lower energy consumption compared to other communication technologies. In summary, the application of LPWAN technology can greatly reduce the infrastructure cost, operation and maintenance cost of IoT equipment, while also solving the problem of battery life, making it highly suitable for cost-sensitive logistics industry.

Given the above benefits, LPWAN is very likely to become the next generation connection technology for logistics supply chain, partially replacing the current mainstream connection technology.

Today, many smart cities and smart utility applications have widely adopted LPWAN technology, such as smart street lights, humidity sensors, smart metering and smart parking. In Germany, DHL has equipped 250,000 roll cages with LPWAN technology to obtain accurate information on the position and movement of the roll cage. China Post is also promoting the commercial use of ZETag cloud tags based on LPWAN technology to strengthen the digital management of logistics pallets.

The broad and in-depth application of LPWAN technology in the logistics industry will accurately solve the issue of the need for customized applications for different logistics scenarios, and continue to drive industry-wide digital transformation.

7. Smart Logistics Entering the Era of Green Packaging

Cainiao’s packaging recycling initiative across Cainiao Post stations in China

In 2021, China’s annual courier delivery business has exceeded 100 billion pieces, but the rapid development of the logistics industry has also generated a lot of paper and plastic waste. With the goal of achieving carbon neutrality, the development of green packaging and recycling technology is now of great significance.

However, relying solely on logistics companies will not be sufficient for the entire industry to advance into the green era. To attain the required scale and impact, logistics companies need to work with manufacturers, brands and supply chain partners to jointly promote green packaging governance. For example, Cainiao has joint hands with Nestlé to produce customized packaging in the Nestlé factory to reduce the use of plastic materials; adoption of smart reusable cartons in the factory to reduce the consumption of paper; using smart packaging algorithm to match goods to the most appropriately-sized box to minimize packaging; promoting the use of original packaging for delivery to avoid secondary packaging; establishing packaging recycling stations at Cainiao Post stations; recycling specific packaging materials such as coffee capsules by leveraging Cainiao courier services for doorstep pickup.

At present, Cainiao electronic shipping label, smart packaging, reusable cartons, tape-free boxes, recycling stations at Cainiao Post stations are widely adopted. According to the Double 11 Cainiao Green Logistics Report 2021, Cainiao green logistics initiatives, together with contributions from merchants and consumers, gave rise to 53,000 tons of carbon reduction. Other than Cainiao, we are also witnessing other major courier companies setting up recycling bins to collect cartons as part of their recycling efforts.

In 2022, we believe that the logistics industry will officially embrace the era of green packaging. New green packaging technology and new materials will be more widely used in modern logistics. Biodegradable packaging and reusable cartons will replace disposable plastic packaging, while original packaging delivery, carton recycling and other green logistics models will gradually mature.

8. Logistics Industry Will Act as a Strong Use Case for AI Technology

In recent years, AI technology has seen rapid development, and has been adopted in a large number of industries such as security, internet, finance, healthcare, logistics, manufacturing, and transportation.

AI technology, encompassing operational optimization algorithms and computer vision, has significantly improved the efficiency of logistics operations. Especially in the post-epidemic era that is characterized by contactless, autonomous and remote scenarios, only served to accelerate the evolution of the logistics industry towards greater digitalization.

Logistics companies such as Cainiao have been investing in the AI field for many years. Cainiao’s AI Voice Assistant was previously selected by MIT Technology Review as one of the top 10 breakthrough technologies in the world. The AI Voice Assistant does not only communicate fluently with customers, it also adjust its own language expression according to the emotional changes of the customer, making it no different from conversing with a real person.

Logistics is one of the industries with the widest coverage of cameras and boasts some of the most extensive application scenarios. With the breakthrough in algorithm technology, the pixel of vision sensor will similarly increase while cost is reduced, driving further application of visual computing. The incorporation of AI technology will also allow traditional cameras to ‘think’ and realize intelligent management of logistics stations.

With the continuous breakthrough of digital technology, the logistics industry is expected to become one of the most important use case scenarios for AI technology.

9. Greater Online Collaboration Across the Logistics Value Chain

The eCommerce logistics value chain starts from the merchant and passes through courier companies’ last mile logistics network, distribution centers, transfer system, delivery network and other links, before finally reaching end consumers. At present, although the entire value chain is visible on the logistics information page, the reality is that the individual services or segments are not yet online owing to a large extent of decentralization and low degree of digitalization and transparency. This meant that timely communication and convenient updates are hard to achieve. For example, after purchasing the goods, consumers can only contact the merchant to request for specific logistics services or changes, and the merchant will in turn have to contact their logistics point-of-contact who then contacts the courier company to resolve the problem. This makes for an inefficient service system.

Speed and efficiency are key to success in the logistics industry. In order to improve service levels, the entire logistics value chain needs to tap on AI technology to bring about greater digitalization and collaboration — and this will be the mainstream trend going forward.

Through greater integration of resources, personnel and service nodes, real-time location tracking of goods, status query, information sharing, and flagging of anomalies will be realized. With greater integration, we will see more collaboration; information will no longer be transmitted layer by layer, but through the digitization and visualization of the entire logistics value chain; real-time order tracking and anomaly detection monitoring, along with timely engagements to facilitate parcel returns, interceptions, reminders, complaints, etc. will become more efficient.

10. Greater Digital Penetration and Automation in Rural Areas

Automation technology has been popularized on a large scale in the field of industrial manufacturing, which can replace manual work to do some repetitive and process-based work, so as to effectively solve employment challenges while improving efficiency, accuracy, and operation safety.

Beyond traditional industries, logistics has become one of the industries with a high degree of automation. Amazon began to lay out automated logistics systems as early as 2012. Cainiao Future Park is one of the logistics facilities with a very high degree of automation in China, including personnel entry and exit, vehicle guidance, equipment operation and various links along the logistics chain. In Cainiao’s Wuxi Smart Warehouse, 1,000 AGV robots have achieved collaborative operations through flexible automation technology, and the throughput has more than doubled.

Take Cainiao as an example, in its rural supply chain and distribution center and the smart warehouse for agricultural produce, products are sorted by automated equipment which in turn help farmers achieve higher income. In China’s rural courier stations, automated distribution solutions can quickly improve the efficiency of rural logistics sorting and support the transformation and upgrading of rural delivery logistics infrastructure.

With more couriers entering villages, this will launch a more efficient channel to support the bilateral movement of goods between urban and rural areas, and the increase in the automation rate of courier stations will make rural logistics advance at the same pace as that in the city.

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