The New Language of Packages
Reading time: approx. 15 Min. The New Language of PackagesHow Technology is Already Shaping the Future of Logistics – and Why the Supply Chain Is Coming Along for the Ride.
An invisible marker that broadcasts data wirelessly.
An invisible marker that broadcasts data wirelessly.
An invisible marker that broadcasts data wirelessly. As they pass a digital sensor, the cotton shirts produced for Amsterdam-based project “Fashion for Good” not only identify themselves, but disclose their full life story, including the plantation the fibers originate from and all the processing steps that have happened to get the garments to the delivery stage. The invisible marker is applied to the cotton like a paint and it stores all of this data.In a tamper-proof format, too. “Fashion for Good” is a consortium of several clothing companies, including the C&A Foundation, Kering, and Zalando as well as technology companies such as Bext360 and Haelixa.
This initiative is proof that our current conception of logistics is due an overhaul. Back in 2017, a major survey conducted by industry association Bitkom revealed that the vast majority of companies expected their future logistics operations to incorporate smart glasses, drones, autonomous vehicles, and AI. Around 80% were already using specialist digital solutions to organize and control their goods transportation, and three out of four of the companies regarded the digital transformation of logistics as a major challenge.
Yet we are already experiencing the change
Yet we are already experiencing the change: The logistics sector is currently one of the leaders in terms of digital integration.
So what exactly does that mean? Digital systems that until recently existed in isolation from each other have now merged into digitally connected supply chains. This is something we can all experience at first hand when we check the shipping status of a package due to be delivered by a company such as DHL. We can find out that the package arrived at the transshipment hub two hours ago and is now out for delivery. If you later receive an SMS or email telling you that the delivery is due in half an hour, you can assume that the tracking system has used GPS and individual WiFi points to predict that the driver will be on your doorstep in 30 minutes. And that’s not all; robotics and the digital transformation combine in the logistics sector to create a supply chain that is always up-to-date, as well as being capable of thinking for itself and making specific decisions.
“Digitalization offers groundbreaking solutions not only so-called CEP (courier express parcel). For example, with the help of intelligent algorithms and artificial intelligence, route planning can be optimized to save up to 20 percent in terms of travel time and route distance, which directly equates to reductions in costs and emissions,” explains Marcus Willand, Partner and mobility expert at MHP. As long ago as 2015, DHL started giving the pickers in its warehouses AR glasses that can talk and recognize speech, and that effectively control the work that needs doing; the glasses tell the pickers what to do next, and show them how to get there. The warehouse employees say “done” as soon as they have placed the relevant item on their trolley, which lets the centralized system know that it can display the route to and name of the next item. AR glasses of this kind are now standard equipment at many companies, but some regard them purely as a bridging technology; they believe that the future belongs to autonomous warehouses.
A few weeks ago, robotics manufacturer Boston Dynamics announced plans to launch its warehouse robot “Stretch” next year. It is anticipated that Stretch will be able to handle around 800 packages per hour, as well as assembling shipments, stacking and unstacking goods, and loading and unloading trucks. The robot consists of modules with differing functions: move, grab, calculate. These tasks require the robot to be capable of orientating itself within a space, as well as knowing what to do with the unloaded packages, for example. Boston Dynamics has so far remained silent about the price of its new product. According to Steffen Cords, a logistics expert at MHP, “The innovative thing about this robot is the fact that it is mobile and doesn’t need any floor-mounted infrastructure.” He says that this allows companies to engineer a flexible setup with buffers for temporary solutions and peaks in demand, including promotional periods such as Singles Day and Black Friday, or seasonal events such as the holidays: “Companies need to become more agile, and this robot is one answer to that problem. It’s all about flexibility!” says Cords. Stretch also marks Boston Dynamics’ departure from the realm of expensive custom-designed solutions and the advent of the autonomous warehouse robot as a commodity, or in other words a very normal and affordable standard product.
This idea fits in with concepts already in place elsewhere.
This idea fits in with concepts already in place elsewhere.
Over three years ago, the online supermarket and Amazon competitor Ocado built a fully automated warehouse in the small town of Andover (Hampshire, South-East England). Several dozen robots that resemble refrigerators work there picking grocery orders. The smart boxes move around on small wheels across a grid designed for this purpose. These robots take autonomy to the extreme – they continued to pick their orders even in the midst of flames and smoke after a fire broke out overnight in the building in 2019. The firefighters that arrived on scene had to dodge the boxes as they trundled along their routes.
The era of custom-designed solutions is also over for the architecture of warehouse buildings.
The era of custom-designed solutions is also over for the architecture of warehouse buildings.
Companies such as Israeli startup Fabric, based in Tel Aviv or Mecalux, based in Germany, offer infinitely expandable warehouse solutions that can be stacked together like Lego bricks along with different cooling zones. Not enough capacity? Additional warehouse modules can easily be added on. Too much? The modules that are surplus to requirements can simply be returned. This concept makes it possible to compensate for varying demands and transshipment volumes at different locations caused by seasonal fluctuations, such as university cities during breaks or holiday resorts in the off-season, thus enabling ad-hoc scalability for warehouse logistics.
New fast delivery concepts by companies like Berlin-based startup Gorillas promise groceries delivered to your doorstep in no more than 10 minutes, which is less than the time it takes to put on your shoes and coat, and locate your keys and bank card. These concepts depend on new logistics systems in order to function properly. Gorillas also relies on a system of small, hyperlocal logistics centers and micro-fulfillment centers as tiny and largely automated storage spaces – small units that become profitable thanks to the consistent digital control of all processes and a modular setup. The high initial costs are balanced out by low personnel and operating costs.
“We’re already seeing the first major cities introduce inner-city bans for heavy semi-trailers wishing to unload goods,” says Steffen Cords.According to Cords, the transshipment of goods has to take place outside the city, where the goods are distributed to multiple small storage facilities known as micro-fulfillment centers. Juan Maria Santos Veira, CEO of Mecalux, says: “Being close to the end customer makes it possible to cut transport costs. It’s a solution to the problem of urban freight distribution, which has been a major issue for cities; last-mile deliveries on foot or by bicycle mean that delivery vehicles are no longer needed.”
In recent years, solutions for identifying goods or batches have also become ever smaller and cheaper, which in turn has increased the granularity of the data. Barcodes or QR codes have become standard, and the same can be said for tracking; goods management systems can remember where each product is located and what it is. This was already an option in the not-so-distant past when employees used to scan codes using handheld or stationary laser scanners. RFID chips make life even easier by making themselves known autonomously and communicating their presence wirelessly, allowing for ever greater automation of transport processes. Yet the developments will not stop there.
The self-adhesive RFID chips are already smaller than credit cards, but the IBM Lab in Rüschlikon (south of Zurich in Switzerland) is working on digital identification options that can simply be sprayed on like paint. According to IBM, these edible crypto-anchors are, “tamper-proof digital fingerprints embedded in products or parts of products and linked to blockchain systems.” René Bostic, Vice President of AI Applications at IBM in Atlanta, is enthusiastic about the innovation and claims that there are almost no limits to its use. The liquid codes could be sprayed onto or mixed with salad, rice, or olive oil, allowing every product to be identified individually, digitally, and in a networked manner as soon as it is produced. There are advantages and disadvantages to this approach: It means that the origin plus the production and processing methods can be documented digitally and economically, and that the product can be located at any point along its delivery route. However, this method is a black-box approach that only allows companies with the relevant readers to gain access to the market.
The project by the Amsterdam initiative “Fashion for Good” demonstrated back in 2019 that raw organic cotton fibers could be sprayed with an invisible, soluble marker and tracked from the plantation through to the finished garment and along its delivery route using blockchain technology. Denver-based SaaS platform Bext360 is also involved in the project and provides blockchain traceability and quantifiable sustainability indicators as a basis for measurable accountability in critical supply chains. Bext360 focuses on supply chains in sectors such as coffee, seafood, timber, minerals, cotton, and palm oil.
According to Bext360 CEO Daniel Jones: “By using the Bext360 SaaS platform and linking the various marker technologies, the project enabled the digitalization of field applications, farm-to-retail transactions, smart tags, and marker data, and demonstrated critical processes for improving supply chain traceability and efficiency at all stages. Marker technology coupled with the blockchain tracking platform creates a robust, trusted and immutable method of recording and sharing supply chain data with stakeholders and consumers in a transparent way.
This method also means that a “second supply chain” will become increasingly important in the future, i.e. the product’s journey back to the manufacturer or to suitable recycling locations – particularly in sectors where sustainability demands are forcing manufacturers and users alike to think about a product’s entire life cycle. As a consequence, companies will have to assume greater responsibility on the basis of this newly gained transparency, and so supply chains are also being changed by the demands of a circular economy. As the technology develops, we are also seeing a multitude of new services emerge. Once products are comprehensively and automatically identifiable, and every process step and (most importantly) routing is organized digitally, warehouses would no longer necessarily need to be operated by retail companies themselves. Instead, they could store and deliver products from different retailers. These new services would be marketed as “Robotics as a Service” or “Picking as a Service.”
The organization of logistics would become increasingly decentralized.
The organization of logistics would become increasingly decentralized.
Clumsy and less powerful supply chains could be replaced by smart, self-learning, and self-optimizing networks that allow goods and products to be routed via almost any path or pushed to other recipients in almost no time if they are needed more urgently elsewhere. This is what Berlin-based startup SPRK.global does, for example. It specializes in foods that are highly likely to reach their expiration date without being sold. SPRK.global automatically routes them from retail outlets to locations where they can still be put to good use. In the food processing industry, for example, where strawberries that will soon become unsaleable can be transformed into delicious strawberry preserve.
Conclusion
Smart route planning optimized by algorithms and AI can deliver savings of up to 20%. The clumsy supply chains of the past will be replaced by logistics networks that allow goods and products to be routed in real time via any path and pushed to other recipients in almost no time if they are needed more urgently elsewhere. To make this vision a reality, companies must start to cooperate much more closely since these concepts can only be implemented on the basis of partnerships and deep integration.
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The New Language of Packages
An invisible marker that broadcasts data wirelessly.
In a tamper-proof format, too. “Fashion for Good” is a consortium of several clothing companies, including the C&A Foundation, Kering, and Zalando as well as technology companies such as Bext360 and Haelixa.
Yet we are already experiencing the change: The logistics sector is currently one of the leaders in terms of digital integration.
This idea fits in with concepts already in place elsewhere.
The era of custom-designed solutions is also over for the architecture of warehouse buildings.
“We’re already seeing the first major cities introduce inner-city bans for heavy semi-trailers wishing to unload goods,” says Steffen Cords.
Yet the developments will not stop there.
The project by the Amsterdam initiative “Fashion for Good” demonstrated back in 2019 that raw organic cotton fibers could be sprayed with an invisible, soluble marker and tracked from the plantation through to the finished garment and along its delivery route using blockchain technology.
These new services would be marketed as “Robotics as a Service” or “Picking as a Service.”
The organization of logistics would become increasingly decentralized.
To make this vision a reality, companies must start to cooperate much more closely since these concepts can only be implemented on the basis of partnerships and deep integration.
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