DISRUPTION

IN
LOGISTICS
 Introduction
Logistics companies are facing an era of unprecedented change as digitization takes hold and customer expectations evolve.
New technologies are enabling greater efficiency and more collaborative operating models; they’re also re-shaping the
marketplace in ways that are only just beginning to become apparent. New entrants, whether they be start-ups or the
industry’s own customers and suppliers, are also shaking up the sector.

Sharing the
Key Disrupting Factors PI(e)

Digitization
Changing customer expectations Scale Logistic Start Up,
matters scenarios Shake Up
Technological breakthroughs
New entrants to the industry
New ways to compete or collaborate
Complex
Competition
 Changing Customer Expectations
• Like individual consumers, industrial customers now expect to get shipments faster,
more flexibly, and with more transparency at a lower price.

B2B: Striving for technology and transparency

•To achieve this logistics

•Manufacturing industry is
•Customers expects and transportation needs to
facing far greater
reduced defects, faster integrate data analytics to
expectations in terms of
market time and provide real time
transparency and
customized products. traceability and
performance.
predictability.

•IOT and Industry 4.0

The ultimate goal is to make
enabled this sector to
product as per Digital fitness is necessary
redefine their Supply Chain
specifications of each for every logistics company.
and way of interaction with
customer.
customers.
 B2C Customers: New Shopping Pattern

Many B2C customers went online long back before retailers and its bit difficult for many logistics companies
to keep up.

The leading players are adopting “Total retail” model, which is operating model across brink and mortar and
online retail.

Total retail is complemented by ‘connected retail’, where retailers aim to create a seamless brand experience for
the customer across personalised marketing, the physical store, the digital experience, and the payment options.

Main Concern

Concept of dynamic pricing

Customers not bother about
Shippers are not part of
shippers, all they want is
branded retailers, they are
reliable product in no time
individual entities.
with zero shipping charge
is not popular in logistics.
Customer is willing to pay
same price irrespective of
seasonal constraints or
surcharges
 Technological
Breakthroughs

 Digital Fitness : Data analytics,

automation and platform solutions
 So many technologies competing
for management attention and
investment

 Digital is still a challenge

• 90% w.r.t other sectors(data
analytics)
• Lack of culture and training
 Automation reshapes workforce
 Automation breaks down the
equation between service
level and costs
 Technology Impact
1. Improved supply chain
Physical Internet(IoT
transparency, safety and
based) efficiency
1. Improvements in customer
experience and operational
efficiency in operations
Data analytics 2. Greater inventory visibility
and management
3. Improved predictive
maintenance
1. Enabling new platform-based
Cloud business models and
increasing efficiency
Uncertainties
1. Social expectations around
data privacy and security may
change
2. Regulation around data
security and privacy may
increase or be enforced more
stringently
1. Rate of development of data
processing capacity is unclear
2. Question marks around data
security
3. Social expectations around
data privacy and security may
change
1. Development of costs unclear
(once a certain scale is
reached physical data centers
still tend to be cheaper)
2. Uncertainties around data
security
 1. Enhanced supply chain
security (reduction of fraud)
2. Reduction in bottlenecks
Blockchain (certification by 3rd parties)
1. Rate of adoption uncertain
3. Reduction of errors (no more
paper-based documentation)

1. Reduction in human
workforce and increased
efficiency in delivery and
Robotics & 1. Speed of technology
warehousing (including
Automation development unclear
sorting and distribution
centers)
2. Lower costs

1. Lower transportation
1. Speed, scale, and scope of
demand
3D - Printing 2. Transported goods would
uptake by customer
industries still unclear
mostly be raw materials
 New Entrants to the
Industry

Start-ups Big players of the Industry’s own

industry customers
Technology Autonomous Vehicles Warehouse automation
•Platform technology •Technology-automotive Developing in-house
•Digital technology collaborators capabilities
Business model •Self driving lockers
Amazon and Alibaba
•Asset light Crowd sharing platforms
•Freight forwarding •Car sharing
•Last mile delivery
 New
Entrants
 Logistics scenarios
2. Start-up, shake-up
1. Sharing the PI(e)

4. Scale matters 3. Complex competition

 Sharing the PI(e)
Incumbents increase their efficiency and reduce their environmental impact by collaborating more, and developing New
business models, such as sharing networks. Research around the ‘Physical Internet’ (PI) leads to shared standards for shipment
sizes, greater modal connectivity and IT requirements across carriers
 Leading Logistics Startups in India
• Launched in May 2011
• Present in over 800 cities
• Doesn’t own a personal logistics network
• Aggregator Model: enlists the services of
several logistics partners
• Provides the technological backbone which
connects all partners
• Uber of logistics companies
• Launched in 2015
• Primarily operates in the business-to-
business (B2B) logistics space
• Works with large firms that need
transportation solutions
• Provides trucks to large firms for
transporting their goods across the
country with the support of a
technological backend.
 Leading Logistics Startups in India
• Launched in 2014
• Focused on the technology part of logistics
• Integrates Internet of Things (IoT) solutions
to help track and monitor shipments at
different stages of the delivery process.
• Allows businesses to monitor their
shipments in real-time
• Also protect against possible pilferage and
stealing while ensuring that the process is
streamlined to reduce any delays.
• Launched in 2014
• Follows a network-led logistics model to
transport goods across the country.
• Positions staff around India and goods are
transported in stages and handed off to
the next partner.
• Each zone and region can be served by a
set of driver partners without them
needing to drive across the country.
Complex Competition
Technology players may enter the
logistics space with increasing
sophistication of technology
Large grocery and retail chains are
partially or fully owning their logistics
support and integrating both their
offline and online retail channels
Increasing predominance of online
retailers and their capability to own
logistics services have affected E-
commerce
Customer expectations
• Customers rapidly digitize supply
chain
• Autonomous vehicles become
accepted by customers
Technology
• Warehouse robotic solutions
increase in sophistication
• Autonomous vehicles achieve
market maturity
• 3-d printing-based manufacturing
gains scale
New Entrants
• New entrants are predominantly
major players from online retail
and technology based industries
Collaboration vs
competition
• Major retail and logistics
platforms compete for dominance
• Retailers initially develop logistics
capability to support own
operations, but gradually move
into 3rd party provision
 Scale Up matters
• Incumbents increase efficiency by streamlining their operations and
taking full advantage of new technology.