Today, AI is a must for the logistics industry. The constantly changing economy and competition make logistics companies look for the best and most effective solutions. No wonder they reach for ML and AI, which bring many benefits. In this article, we present the best solutions that AI consulting services offer for logistics. Check it out!
AI in Logistics
The role of artificial intelligence is visible in many industries. Properly leveraged, it can bring many benefits. Today we will focus on the logistics field and see how it has changed the way this industry works. Elements of artificial intelligence can be observed commonly in:
- Anomaly detection,
- Intelligent route optimization,
- Warehouse automation,
- Predictive analytics
- Autonomous vehicles, etc.
With AI, companies can automate many important functions crucial in the logistics process. It is worth noting that AI elements don’t eliminate workplaces. On the contrary, they are a key addition that allows for the acceleration and improvement of the effectiveness of certain activities.
More and more logistics companies are beginning to notice the benefits and values that AI and ML bring to this business. No wonder the implementation of AI can prove to be an effective way to strengthen the supply chain and enhance logistics capabilities. According to a McKinsey report implementing AI has allowed companies to
- Reduce logistic costs by 15%
- Boost service levels by 65%
- Improve inventory levels by 35%[1]
AI for logistics – effective solutions
Below we present the most effective solutions for your business.
WAREHOUSE ROBOTS
To improve the management of the supply chain, organizations invest in warehouse robots. This AI technology helps employees pick, sort, transport, and stack packages. Research shows that in 2021 the warehouse robotics market was valued at $ 4.7 billion. Moreover, it is assumed that by 2026 it will increase by 14%.[2] How do warehouse robots work? Stickers with bar codes are placed on the warehouse floors, which allows the robots to move around the warehouse.
ROUTE OPTIMIZATION
Artificial Intelligence in logistics allows businesses for route optimization. Algorithms and AI alleviate a lot of human burdens and revolutionize route planning. The route optimization method uses shortest path algorithms to determine the best route for logistics trucks. As a result, shipping costs will be reduced, and the shipping process will be accelerated.
As artificial intelligence becomes more sophisticated, it will make freight management much easier since it will allow for more efficient logistics planning. It also lowers shipping costs and expedites the delivery process.
ANOMALY DETECTION
Every trader is aware that if a damaged product reaches the customer, it will cause a lot of unpleasantness – dissatisfaction, resignation, negative opinion, and, consequently, loss of the customer. And this is what companies want to avoid. Therefore, many organizations have decided to implement computer vision technology. It is a technology that identifies damage and is also able to assess not only the type but also the depth of the damage.
REAL-TIME PRICING
What’s the difference between real-time price and traditional price? Real-time price, or dynamic price, is very flexible, meaning it fluctuates based on the demand, supply, or prices of competitors. The pricing software mainly uses ML algorithms to analyze historical customer data. With it, companies can react faster to fluctuations in demand and adjust the price to the customer.
AUTONOMOUS VEHICLES
A truck without a driver? It would change the logistics industry a lot, right? And it is very real thanks to artificial intelligence. Currently, Tesla and Mercedes are investing heavily in the concept of autonomous vehicles. And Uber, which took over by the startup Otto some time ago, boasted a film showing the journey of an autonomous truck. There was a driver in the cab, but his role was limited to that of an observer. The Boston Consulting Group estimates that about 10% of light trucks will be self-driving by 2030.[3]
PREDICTIVE MAINTENANCE
Predictive maintenance is nothing more than predicting machine failure. IoT sensors (installed in machines) analyze data in real-time, providing information on the technical condition. Such analytical tools allow technicians to take appropriate action before a critical failure occurs.
DEMAND FORECASTING
AI in logistics, unlike human labor, can process the huge amounts of data that generate the supply chain every day. Therefore, AI-based demand forecasting methods reduce the error rate. And thanks to the increased accuracy, you can lower the cost of forecasting, reduce operating costs, and optimize the number of vehicles sent to the warehouse.
Conclusion: Use AI ai in logistics and supply chain
The future of AI in logistics and supply chains is highly auspicious. As new technologies offer a wide range of opportunities, it is expected that soon, AI systems will be increasingly deployed by logistics companies that want to optimize their business operations. Moreover, due to the changing economy and competitive environment, companies will be forced to look for solutions that will generate better results. If you want to know how to use AI in your logistics company, start with AI consulting services.
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