Happy New Year! Here's A Crystal Ball For Businesses Powered By Logistics

A very Happy New Year to everyone! It's that time of the year when you reflect on what was, but more importantly, you are excited about the endless possibilities that lie ahead. As we embrace 2022, Shipsy turns older and smarter. In just six years, we have become a potent force transforming the way global businesses manage logistics. Hence, I would like to take this opportunity to thank our customers for being a key driver behind this incredible journey and my entire Shipsy family for taking it upon themselves to improve logistics for everyone.

Looking Back At 2021

The second COVID wave triggered a series of tragedies across the globe in 2021. My heart reaches out to all those whose lives got impacted during these unprecedented times. Having said that, there have been some positive developments that kept us extremely motivated and positive.

The year 2021 saw Shipsy enabling seamless delivery of vaccines across the country. We partnered with a leading quick commerce provider to ensure deliveries are done within 10 minutes. We joined hands with a rapidly growing hyperlocal delivery provider to empower them to scale on-time delivery volumes by more than 90%. A logistics company in the Middle East is leveraging Shipsy's technology to power autonomous deliveries using robots. We helped one of the world's most famous pizza delivery chains to shrink their delivery TAT from 30 to 20 minutes by reducing their order allocation time by more than 44%.?

To make logistics operations sustainable, our technology empowers businesses across the globe to reduce carbon footprint by curbing distance traveled by 5% and decreasing trip volumes by 6%. We are clocking a growth rate of 2.5x and have increased our people strength by 75% in 2021. Shipsy strengthened its foothold in the Middle East by establishing regional headquarters in Dubai. This development took our team size to 200 people operating in a completely remote environment. The list is long, but it has indeed been a year of wins.?

A Crystal Ball For Managing Evolving Logistics Ecosystems

Well, that was our 2021 in a gist. I am equally excited about 2022. Driving rapid innovation in the way we manage deliveries to fulfill evolving customer expectations will be the highlight going ahead. Here are six key predictions that will drive the global online delivery ecosystem to embrace modern technologies.

The quick commerce industry will clock a growth of 10-15 times in the coming five years and become a $5 billion market by 2025

#1 Quick Commerce Will Go Beyond Grocery

The emerging quick commerce industry is redefining what brands perceive as "instant gratification." From same-day to one-hour and now 10 minutes, on-demand delivery windows are shrinking fast, and businesses must embrace intelligent technologies to successfully navigate this lucrative space.?

According to RedSeer , the quick commerce industry will clock a growth of 10-15 times in the coming five years and become a $5 billion market by 2025. As of now, these numbers are fueled mainly by online grocery purchases, but soon quick commerce will percolate into food, apparel, electronics and medicines. In other words, it's only a matter of time before the on-demand delivery industry will witness customers expecting their pizza, smart devices, shirts and probiotic capsules to be delivered in 10 minutes.?

Ensuring logistics sustainability is a win-win for businesses

#2 Cost Will Drive Logistics Sustainability

As much as 30% of CO2 emissions come from trucks carrying freight, and 40% of trucks on the road are empty, running wasted miles. As stakeholders in the logistics industry, we need to act now and fight these numbers.?

Three critical factors will drive businesses to make logistics sustainable. One, customer expectations. Today, 70% of consumers say they are willing to pay a premium of 5% for products produced by more-sustainable means. As environmentalism goes mainstream, customers will soon want the way products are delivered (not just how they are made) to be sustainable. The second factor will be government regulations, and compliance chalked out by industry associations. Countries worldwide will need businesses to help them achieve 40% less greenhouse-gas emissions by 2030, as directed by the Paris Agreement.?

The third factor that's most urgent is cost. Ensuring logistics sustainability is a win-win for businesses. For instance, leveraging capabilities that reduce trip volumes, consolidate orders, shrink miles traveled, eliminate empty miles, and increase first-attempt success rates optimize delivery costs and curb a brand's carbon footprint. Let's cite a real-life use case. To shrink carbon emissions, P&G reduced the distance traveled by its trucks by 20%. In doing so, the organization improved vehicle capacity planning and moved distribution centers closer to customers, positively impacting cost and supply chain efficiency.

#3 Demand For Cross-Border eCommerce Will Skyrocket

Rapid adoption of mobile-based purchasing platforms, enhanced connectivity, improved logistics operations, multiple payment options and growing customer ambitions are vital factors blurring international boundaries. Today, a pair of shoes a customer ordered online from a home in Delhi is probably shipped out of a warehouse in Memphis, Tennessee. The Parmesan Cheese we use here to make spaghetti exquisite is shipped from a small province in Italy. The beautiful silk apparel the Indian diaspora wears to celebrate their culture is sent from a large metropolitan city in South India.?

According to Forrester, cross-border purchases will comprise 20% of all worldwide eCommerce in 2022, with sales of $627 billion. The Asia Pacific region will become the largest cross-border eCommerce region for imports and exports. In fact, Forrester highlighted that cross-border eCommerce will be outpacing domestic growth, with a compound annual growth rate of 17% between 2017 and 2022, compared with 12% for overall B2C eCommerce.

Hence this ballooning demand for cross-border commerce will drive manufacturers, retailers and shippers to build capabilities that can enhance capacity planning, ensure greater visibility of shipments and help partner with the right logistics provider for the right job.

#4 Automation Will Become Synonymous With Hyperlocal Deliveries?

Businesses under the hyperlocal, on-demand and quick commerce umbrella will find themselves embracing advanced automation tools to power faster and delightful deliveries. For instance, brands can quickly respond to 10 minutes grocery delivery requests by using auto-allocation engines. Such systems drive intelligent processes based on predefined constraints like weight, volume, proximity from customer and store, driver workload, and more. We have customers who are redefining how on-demand deliveries are executed. They are auto-allocating 99% of their delivery tasks to achieve never before seen delivery turnaround times and on-time delivery volumes.?

The demand for lightning-fast fulfillment will automatically drive local businesses and delivery aggregators to build capabilities

#5 Inventory Visibility Will Be Key For the On-Demand Industry

Ensuring inventory is critical, but real-time visibility of inventory will be a game-changer for on-demand delivery providers. For instance, the whole concept of delivering from Kirana or neighborhood stores has immense potential. Still, due to a lack of visibility over what's currently available at the store, the model fails to realize its full potential. But the demand for lightning-fast fulfillment will automatically drive local businesses and delivery aggregators to build capabilities that allow customers and other delivery stakeholders to have real-time inventory visibility.?

#6 Technology Will Enable Seamless EXIM Operations

With millions of shipments moving globally, the intensity of cross-border logistics will keep increasing. In 2021, sudden lockdowns, increasing spot rates and lack of container availability caused significant disruptions in export and import operations. To build resilient export and import operations it's going to be critical for manufacturers, retailers, freight forwarders and shipping lines to make EXIM operations intelligent and cost efficient. Technologies that empower businesses to optimize capacity, drive smart freight procurement processes, gain end-to-end visibility of shipment and make financial transactions absolutely transparent will see rapid adoption.?

One of our customers, a Fortune 100 conglomerate, is leveraging automation driven shipment management solution to reduce incidental costs by 80% and overall EXIM logistics expenses by 10%. The solution is enabling them to shrink person-hours spent in managing manual shipping processes by 65% and drive accurate data-driven freight procurement decisions.

So, that's the direction where the logistics industry is headed. For all the businesses out there powered by logistics, I would love to conclude by saying Miguel de Cervantes' famous words – to be prepared is half the victory.