How Internet of Things (IoT) can Transform Supply Chain ?

How Internet of Things (IoT) can Transform Supply Chain ?

The Internet has been in the thick of the things since its inception, and now it has evolved into something more unique, effective, and user-friendly.

Here we are talking about the Internet of Things or IoT. In the early 2000s, MIT’s AutoID Lab coined IoT through research, which means IoT is not a new concept. However, over the years and with constantly improving technologies, it has become more usable.

Those who are still new to this concept, let’s define it in simple terms:

IoT is typically a networked connection of various physical objects. The network may comprise devices, vehicles, and even buildings embedded with software, electronics, sensors, and actuators to establish communication with users and other devices.

Smart Connectivity and Smarter Devices

The emergence IoT has now made possible to extend the Internet connectivity to a range of physical objects that are not typically related to computers. Equipped with IoT, these objects can fulfil multiple objectives other than their basic function. For example, a connected air conditioner may change its temperature automatically based on the temperature outside and inside of a home. Also, the AC may also alert the owner with key information on humidity, quality of air and others.

A study carried out by Cisco shows that by 2020 there are likely to be more than 50 billion devices connected to the Internet. Out of that volume, desktops, laptops, smartphones, and tablets will constitute only 17 percent of all the Internet connections. The remaining 83 percent will be connected through IoT, including wearable and other smart devices.

The opportunities to integrate IoT with various business spectrums are wide, and logistics is one of them. The main focus areas for IoT in the logistics segment are in three areas – warehouse operations, freight transport, and last mile delivery. Out of these, last mile delivery, which is the final phase of delivering products to customers, are often less efficient than the previous phases. Here, we will talk about how IoT can change it all.

The Effects of IoT on Retail and Supply Chain

IoT can integrate with a diverse range of technologies including wireless, comprising Wi-Fi, RFID, Bluetooth, and Zigbee. Other technologies and networks are wireless mesh network (WMN), wide area connections including 3G, LTE, and also wired connections. IoT is also leading the way with the convergence of information technology (IT) and “operational technology” (OT).

All of this technological prowess of IoT can close out the persisting loopholes of a retail supply chain. According to the research firm Gartner, the IoT trend is going to impact businesses; particularly it will disrupt the way logistics companies operate.

Organizations have been using ERP and supply chain management (SCM) for quite some time for seamless operations. However, the IoT will allow them to enhance those tools by connecting people and streamlining processes, data, and other areas through devices and sensors.

Simply put, the IoT will give access to richer data and deeper intelligence to all the parties involved in a supply chain. By enabling devices to connect to each other, IoT can help transform a supply chain and obtain the following benefits:

•  Save fuel costs significantly through better routing and monitoring traffic conditions
•  Manage inventory efficiently by keeping track of items & reducing out-of-stock situations
•  Bring down loss of assets by learning about product issues in time and finding a solution
•  Gain precious insights into consumer behaviour through embedded sensors

These benefits from IoT can bring about a drastic change in the retail industry including e-commerce, traditional brick-and-mortar stores, and omnichannel. For example, a retail connected through diverse IoT-enabled devices can ensure greater operational efficiency and great customer experience. This efficiency comes through in-shelf product availability, better inventory/merchandise optimization, loss prevention, mobile payments, and convenient delivery methods.

How about Integrating IoT for the ‘Last Mile’ Success?

Integration of IoT in logistics can bring in far-reaching benefits to logistics companies, their clients (retailers), and end consumers. These benefits further trickle down to the entire logistics value chain, including freight operation, warehousing, and last mile delivery. The end results are better efficiency, excellent product offerings, and memorable customer experience.

If we specifically focus on retail logistics, IoT integration can significantly improve in-transit visibility through cloud-based GPS and Radio Frequency Identification (RFID) technologies to get information on the precise location and other tracking information. Data collected from GPS and RFID technologies allows logistics carriers to automate shipping and delivery by accurately predicting the time of arrival.

By now you may be curious to know how IoT does all this. An example can clarify things better. By placing a RFID chip in a pallet, a smart device in the shipment vehicle can transfer data into the cloud. The device can identify the pallet and share its position through GPS coordinates. Also, other key data will also be available including weather, traffic conditions, driving pattern, the average speed of a vehicle, and more.

When delivering items in more congested areas, Bluetooth tags and beacons provide tracking data. Even retail stores can use these tags to monitor customer footfalls and offer customized marketing messages.

Finally, when it comes to handing over packages to customers, installing automated parcel lockers can reduce logistical hassles substantially. The reason is courier personnel only need to deliver parcels to the designated parcel terminals instead of looking for individual customer’s address.

DHL, for example, is introducing Parcel Box, which allows recipients to install a personal locker at their front door to make sure parcels are delivered instead of getting a slip of paper with a “sorry we missed you” note. These parcel boxes are already functional in Germany, and in the process of getting implemented in other European countries.

The last mile delivery has long been dependent on traditional logistics and human intervention, which often lead to errors. With increasing parcel volumes, having more convenient delivery points will make life easier both for logistics firms and consumers. Soon IoT-enabled temperature-controlled smart lockers may replace traditional mailboxes to make delivery a simple and seamless process.

The Way to Future

Every day millions of shipments move across the world, which involves a lot of efforts including packaging, loading, tracking, and delivering. Integration of IoT in the entire process of logistics can help weed out non-value added (NVAs) or unproductive activities. IoT can connect various devices or assets in a supply chain and analyze the data generated from these assets to provide key insights. In this way, IoT enables logistics services providers to be more efficient by creating customized and automated services for their customers.

Integration with stand-alone IoT-enabled technologies like parcel lockers are making life easier for logistics companies. By connecting to various devices, tracking each phase of the delivery process has become simple and smart. Automated click & collect lockers are physically robust, technologically advanced, and virtually secure. Most importantly, you can significantly reduce your logistics cost through bulk delivery.

If you wish to know more about parcel lockers, dial +91-8882-760-760 or drop an email to, and one of our representatives will give you all the details.


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