Many still view IoT in the supply chain as something primarily used by corporations like Amazon and Alibaba. But can a small or medium-sized company benefit from using IoT technology? Find out in this article.
What we are going to discuss:
- By 2028, the global market of IoT in logistics and supply chains is expected to reach USD 93.85 billion.
- IoT improves real-time monitoring, inventory management, and automation in supply chain operations.
- Plus, it helps reduce waste and make your supply chain more eco-friendly.
Efficiency. Transparency. Cost reduction. Risk mitigation. Sustainability.
Are these the factors that your supply chain business is lacking today? (If so, you are not alone, as many businesses struggle with the same challenges.) Then IoT in supply chain management is exactly what you are looking for, as it makes supply management smarter, faster, and more cost-effective.
No matter the size of your business, IoT can optimize your processes and increase profitability. And now, with IoT solutions evolving rapidly, it’s the best time to invest in them.
Mind Studios has years of experience developing smart logistics and supply chain solutions that seamlessly integrate with IoT-driven insights.
If you are looking for a custom IoT solution to optimize your supply chain right now, we’re here to help.
Why you should consider investing in IoT for supply chain management
Investing in IoT supply chain management means building a more resilient and future-proof supply chain. Businesses that adopt real-time tracking and automation can significantly cut costs and gain agility in response to constant market changes.
— Dmytro Dobrytskyi, CEO of Mind Studios
You’ve probably heard about the benefits of IoT in the supply chain, such as transparency and business performance improvement. But how is IoT used in the supply chain, exactly? And how can it help your operations in particular?
The supply chain management process involves multiple complicated steps, logistics-wise, from supplying raw materials to manufacturing and sending the finished products to retailers. IoT technologies are aimed at making this journey more transparent — and thus more efficient, both operationally and strategically. Here is how it works.
Tasks IoT in supply chain management helps with
Supply chain management using IoT involves using various sensors and IoT devices to gather and store information about goods. This data can be used to simplify day-to-day operations and make informed business decisions.
By using the Internet of Things, supply chain managers can efficiently:
- Track real-time location of the goods
- Locate items in the warehouse
- Optimize inventory control
- Determine the speed of goods’ movement
- Monitor storage conditions (like temperature, humidity, pressure, etc.)
- Control the quality of raw materials and productions through IoT scanners
- Forecast customer demand more accurately
- Minimize losses by sending real-time alerts when something goes wrong
- Automate entire warehouse operations
- Deal with post-arrival administrative tasks
- Manage paperwork tasks like processing bills of lading
These functions of the Internet of Things in supply chain management are becoming more and more convincing for small businesses to use the technologies alongside big global companies.
How telematics and IoT are taking smart fleet management to the next level
While old traditional GPS once revolutionized fleet tracking, IoT-powered telematics takes things even further.
For your reference: Telematics is a technology that combines both telecommunications and informatics. It enables remote monitoring of vehicles by gathering/transmitting real-time data about their operations.
To put it simply, it’s more than just understanding where your vehicles are, but rather about understanding how they are performing and using data to make smarter and more cost-effective decisions.
IoT-powered telematics provides fleet managers with even deeper insights and more data, from real-time vehicle diagnostics to fuel consumption and predictive maintenance alerts. Equipped with a combo of IoT and telematics, logistics companies can reduce downtime, proactively manage vehicle performance, lower fuel expenses, and overall improve fleet efficiency.
7 reasons to integrate IoT into supply chain processes
Integrating IoT into supply chain management processes can be a costly investment. To understand why you should still do it, let’s look at the most significant advantages IoT supply chain managers can benefit from in the long run.
#1: Increased visibility and transparency
Using IoT across all stages of the supply chain management process helps all parties involved have a clear picture of the product’s journey, from collecting raw materials to delivering the finished goods to retail locations. This helps ensure that the whole cycle is time and cost-efficient, as well as control the quality of the products.
For businesses dealing with supply chains, IoT also simplifies the task of implementing their strategic goals and reporting the results to the stakeholders.
Mind Studios’ insight: Our experience shows that the most effective solutions of the Internet of Things in supply chain management are those that seamlessly integrate with your existing ERP or CRM system. This way, you will achieve smooth cooperation between different departments as well as improve overall effectiveness.
#2: Smooth cooperation between teams
The supply chain cycle involves multiple parties: manufacturers, delivery providers, warehouse managers, and more. And when different teams operate different data sources, bottlenecks happen — and they can damage the efficiency of the entire process.
With IoT solutions for logistics and supply chain management, these parties can build a unified system based on the same cloud and data analytics services and thus have access to accurate information in real time while avoiding inconsistencies and delays.
Mind Studios’ tip: If you want to maximize the effectiveness of IoT-based supply chain management, you need to train your employees early on. Although most companies oftentimes underestimate the importance of team training, it can greatly improve the adoption rate, minimize resistance, and boost productivity.
#3: Elevated customer service
One of the most groundbreaking influences IoT has on customer service is the ability for retailers to forecast the exact delivery time of the products. Even if there are any obstacles, the managers can instantly find out about the delays and manage customer expectations accordingly.
In addition to timely delivery, IoT in supply chain management also helps retailers control the quality of the products they deliver to customers.
#4: Improved forecasting accuracy
Supply chain managers use IoT for demand forecasting and predictive analytics through historical and real-time data.
In combination with AI, IoT in supply chain management assists with establishing a proper flow of goods on production sites and in warehouses. This helps prevent overstocking and understocking, which could otherwise lead to unnecessary expenses and production or delivery delays.
#5: Risk elimination
The main task of IoT is to collect data, and naturally, this data can be used for contingency planning and preventing various bottlenecks by analyzing the reasons for them. For instance, managers can determine whether shipment delays happened due to weather conditions, traffic, or truck malfunction — and take these factors into account next time.
#6: Reduced costs
While, at first, IoT in chain management might seem like a significant investment, especially for a small business, in the long run, it most definitely does help business owners save money.
To name a few examples, improving route planning through IoT helps save on fuel and avoid delays, IoT-based proactive maintenance helps prevent major repairs, and predictive analytics using data collected by IoT helps establish an efficient stock flow.
#7: Sustainability
If you've been thinking of implementing a green strategy in your business for a while, IoT can be the first step in that direction.
Internet of Things sensors are often used to inform managers of how energy and resources are used during different stages of the supply chain processes. This helps executives make an informed decision regarding the choice of renewable sources of energy, switching to electric vehicles, and more.
Ready to improve your supply chain management with IoT? Our tech experts at Mind Studios are here to help you create a tailored solution for your strategic goals.
How IoT boosts ROI in logistics without replacing your entire system
Do you think that integrating IoT into your already existing logistics infrastructure means completely overhauling your legacy systems? Fortunately for you, that’s not the case.
Many logistics companies hesitate to adopt IoT, fearing that it is associated with high costs as well as the complexity of replacing existing legacy systems. However, modern IoT tech can seamlessly integrate with your current CRM, ERP, or warehouse management systems without the need for a complete replacement. What’s more, IoT will significantly boost their productivity.
Here's how it works in practice: You can start small by adding IoT sensors and devices that will instantly help you track real-time data (such as vehicle location, inventory conditions, etc.) These additions will help your company optimize routes and proactively handle maintenance issues, reduce downtime, and forecast demand. Soon, you will see improved productivity, greater operational transparency, as well as notable cost savings. All this without heavy upfront investment or prolonged downtime.
Plus, gradual integration will allow you to modernize your logistics operations at a comfortable pace, ensuring maximum ROI and maintaining your core system intact.
IoT in supply chain examples
The supply chain industry is rife with examples of the Internet of Things at work. Let's examine some existing examples and the businesses that created them.
FedEx
One of the notable examples of IoT in supply chain management is FedEx. This transportation company uses cloud solutions that receive data from the fleet and create the most time and cost-efficient routes possible based on weather forecasts, traffic, and other real-time data from other sources.
Maersk
Maersk is a Danish shipping business that accounts for 18% of worldwide container commerce. The business created the Remote Container Management (RCM) system, which monitors the status of 300,000 refrigerated containers. RCM offers excellent transportation conditions and decreases the possibility of products spoiling, thanks to precise temperature and humidity management.
Furthermore, having complete insight into container conditions enables Maersk to decrease the cost and time required for inspection upon arrival, since inspection companies receive access to data indicating that containers were carried in excellent condition.
Aker
The Aker company illustrates how a raw material supplier might profit from IoT adoption. Aker offers proactive, real-time deep crop surveillance to reduce production loss. Their IoT system employs drones, a network of 3D video sensors, big data technologies, and machine learning, enabling farmers to recognize crop damage caused by insects, diseases, and other causes and make critical choices more quickly.
DHL
DHL and its partners created a custom, low-profile sensor to detect roller cages inside and between DHL facilities. Sensors have low power consumption and a battery that can hold a charge for 15 years. Operators use the sensor data to decrease shrinkage via a cloud-based management platform.
DHL saves 40% on energy costs thanks to another IoT effort. Using innovative heating, ventilation, and air-conditioning, the system adjusts set points in real time depending on predicted weather conditions, building occupancy, and business activity, all while keeping facility temperatures within a chosen operating range.
How IoT for the supply chain is used in various industry sectors
A supply chain is a complex system involving multiple stages, from producing raw materials to handing the finished product to the end customer. And across all these stages, Internet of Things technologies can be beneficial. Here are the five core IoT use cases in the supply chain.
Raw material supplier (e.g., agriculture)
While, in general, IoT is more widespread in the different stages of the supply chain system, the use of various devices is gaining more popularity in the agricultural sector.
For instance, IoT drones, robots, and sensors are often used on farms to measure the chemical composition of the soil, monitor crops and livestock, map fields, and perform other tasks. In the future, as robots become more advanced and accessible, there will be more use cases for IoT solutions used by raw material suppliers.
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Manufacturing
IoT systems in manufacturing help managers monitor the production process and detect any bottlenecks that cost the business money. Also, Internet of Things sensors assist with catching resource leaks and alert supervisors in case of any machine crashes.
To go even further, IoT technology can be used to continuously analyze the machines’ performance, prevent critical breakdowns, and therefore avoid urgent, expensive repairs.
Last but not least, the Internet of Things in manufacturing helps businesses be more sustainable. IoT devices assist in controlling the use of water at manufacturing plants, producing less waste, utilizing it in the least harmful way, and tracking pollution.
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Warehouse management
The main point of using IoT sensors for goods stored in warehouses is to establish an effective real-time inventory tracking system. Through the RFID (radio frequency identification) sensors, warehouses keep track of inventory items, stock levels, new arrivals, changes to storage conditions, and more.
Internet of Things sensors in warehouse management can also be used in combination with smart glasses to increase picking performance and reduce the time required for completing orders.
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Mind Studios’ insight: Some companies that manage big storage spaces use Autonomous Mobile Robots (AMR) with proximity sensors and cameras to completely automate warehouse operations. AMR can analyze and easily navigate around the storage space. Amazon, for example, uses over 500,000 robots to help their workers carry shelves and packages, as well as scan barcode labels and perform other tasks.
Logistics and delivery
One of the key participants of the IoT supply chain management is the distributors responsible for the delivery of goods. They use IoT technology to provide their partners with real-time data on product locations and approximate time of arrival, as well as inform them of any delays.
What is more, by analyzing delivery routes, distributors can optimize them to cut costs in the future, especially if deliveries are done by several means of transportation.
IoT also helps make the delivery process more transparent. For instance, by using RFID tags, the distributors can track every single item that is being delivered and make sure nothing is lost.
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Retail
Just as with IoT warehouse management, Internet of Things sensors help speed up the process of loading and unloading goods in retail locations. But there is more to that.
IoT brings the offline shopping experience to a whole new level, where customers don’t have to wait in lines or even use self-checkouts. Through the use of sensors, stores can identify the products customers pick in the store, add them to their shopping cart in an app, and withdraw the final cost from their account once they leave with the purchased items.
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As you see, integrating IoT in supply chain and logistics can bring significant improvements in transparency, effectiveness, and customer satisfaction for many sectors. If you want to explore how custom IoT solutions can benefit your business, you can always contact our tech specialists.
Mind Studios & IoT supply chain development
So, what comes after you make up your mind about integrating IoT-based supply chain management systems? To make the implementation successful, you need to invest not only in the IoT devices themselves, but also in software that will effectively process and use the data collected from those devices.
Basically, to go through with the idea, you will need to partner up with a software development company that can build you a custom solution to match your business needs perfectly. And that’s where Mind Studios comes in.
Our company has extensive experience in developing platforms for logistics and transportation businesses. One illustrative example is our collaboration with M3Cargo.
What is M3Cargo?
M3Cargo is a cargo company that provides secure direct purchases of goods, raw materials, and equipment transported primarily from China and delivered to small and medium-sized European businesses. M3Cago helps its clients conduct procurement audits, reduce costs, and solve other logistics challenges.
The company also calculates the cost and time of the delivery services in advance and guarantees that the order will not be lost along the way. What is more, the company’s clients can track their orders in real time through an independent tracking service.
IoT impact on the M3Cargo project
For M3Cargo, we created a Real Tracking app using IoT devices: each container delivered by the service has a GPS tracking device attached to it. This app would also process data collected from those devices and enable tracking functionality for the customers to check the current status and location of their orders.
Conclusion
Supply chains have always been vulnerable to various disruptions like resource leaks, damaged products, delays, and losses. Today, IoT technologies are successfully solving these problems — and even helping business owners prepare for the next challenges.
If you are thinking of integrating IoT technology into your business and looking for a reliable partner to develop user-friendly, efficient software solutions that will help you manage and apply the data you collect — Mind Studios has got you covered.
During a free consultation with our business development team, you will be able to ask any questions about software solutions for the supply chain and Internet of Things integration. Together, we will find the most cost-effective solutions for your specific needs. Fill in a short contact form, and we will get back to you.
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