As the complexity of the global supply chain increases, so does the need for visibility. This is where the Internet of Things (IoT) is stepping in to make significant inroads when gathering data and tracking at key points along a product’s journey.
Today, even more goods are transported globally, changing hands multiple times between supplier and consumer. Take for example, UK food retailer Sainsbury’s, a company that sources goods from 60 countries and Asda which has 39 logistics centres nationwide, including 21 food depots. From those, it operates more than 4,000 heavy good vehicles and 2,000 home delivery vehicles which travel 130 million miles annually, making 800,000 deliveries to store and 20 million deliveries direct to customers.
This scale of operation is common in the retail sector, but it does raise some logistical challenges, especially in terms of product visibility and the often-overlooked Returnable Industrial Packaging (RIP). Losses of RIP can have a significant impact on a bottom-line, often causing headaches with scheduling and creating disorganisation, which in turn reduces a business’ scalability and performance.
This problem is intensified by cargo theft and the outright heisting of goods is something that the UK’s national standards body, the British Standards Institution, estimated as having cost UK companies at least £24 million ($31 million) during 2018 alone.
End-to-end supply chain visibility is the answer as this means suppliers can ensure operational efficiencies are made, while keeping losses to a minimum, whether they are caused accidentally or by malicious operators.
IoT provides visibility
The Internet of Things (IoT) enables all elements of the logistics process from packaging, loading to distribution and storage to be tracked, making it the ideal tool for supply chain visibility. Attaching IoT sensors to the valuable components that need to be tracked – pallets, crates, drums etc – gives all interested parties a holistic view of the supplier network so they can obtain accurate and ‘live’ information about shipment location, route and arrival time, amongst other things.
However, there are multiple challenges facing IoT deployments of this nature. Devices need to be trackable anywhere, and for long periods, but they also need to be low-cost, both in manufacturing and operating terms.
This is where the 0G network, a low-power wide-area network (LPWAN), comes in. While Wi-Fi has a limited range and cellular comes with significant overheads, 0G offers both effective tracking anywhere at all times and lower costs, per-unit and in operation. IoT-enabled devices that are connected to a 0G network can transfer small amounts of data at regular intervals to convey location information and other vital data like a container’s temperature for example. This data can be relayed either to the customer or used by the supplier to improve productivity.
0G and IoT combined deliver significant value
By using the data gathered to make internal efficiencies, a logistics firm can improve profitability and ROI. One example is leading logistics company Deutsche Post DHL Group, which delivers around five million shipments each working day. Deutsche Post DHL Group uses thousands of RIP roll cages to contain and transport parcels through its 35 parcel center network, so it is in the process of fitting 250,000 roll cages with Sigfox smart trackers. Those trackers will provide logistics teams with exact information about the roll cage’s locations and movements.
The aim of this type of RIP management is to reduce the overall RIP inventory, while also lowering or removing RIP storage costs altogether and minimising the total cost of operation.
IoT in the supply chain is a balancing act. From real-time polling and battery life to global coverage vs network costs, and unit cost vs performance, there are lots of compromises to be made. A key consideration that is often ignored in the rush to select a solution for today is the potential requirement of the future. Flexibility is a valuable asset, and a network that enables tracking and other data to be sent without any extra infrastructure or additional network cost adds value, and can evolve with business demands.
A good example here is monitoring the temperature of containers carrying perishable goods, particularly meat products, which require a consistent low temperature from supplier to consumer. Another good example is monitoring humidity and shocks to fragile loads. This is a key specification in SafeCube, a new global solution based on collaboration between Sigfox, Argon Consulting and Michelin.
While the global logistics market continues to expand, being set to reach $15 trillion in the next five years, the complexities of today are unlikely to decrease and visibility will continue to be crucial for supply chain efficiency. With profitability at stake, it is essential for supply chain managers to take the long view when investing in IoT solutions today. For flexibility and long-term effectiveness, they should be eyeing reliable and scalable solutions – such as 0G – that will continue to deliver benefits for years to come.