The logistics of tomorrow is most certainly digital and data-based but traditional processes are still most common today. This makes the industry cumbersome and slow. Truck transportation, for example, is a highly fragmented and decentralized sector. There are over 1.2 million trucking companies in the U.S. and every third truck on the road is driving empty. Digitization and innovation offer a remedy.
The digital transformation of the logistics industry is already in progress and it is opening up unprecedented opportunities to enter new markets and restructure existing business models.
Many, companies are taking advantage of these new opportunities. The fact that the overall funding for transportation-focused startups doubled from $7 billion in 2014 to $14 billion in 2015 shows the increased interest in the industry, according to Rocketspace.com. Some are optimizing end-to-end shipping, freight rates or fleet management while others are more focused on storage or local delivery.
Meanwhile, well-known companies originally not logistics-focused are devoting more and more attention to shipping. Online retail giant Amazon, after investing in a truck and air fleet, announced plans to launch a delivery service in February called Shipping with Amazon which will directly compete with UPS and FedEx. Uber, the most valuable startup worldwide, launched UberRush for last mile delivery and Uber Freight to connect carriers and shippers in the trucking industry.
These immense companies have different approaches on what to digitize and how to conquer the industry. Amazon is known for its innovative “chaotic storage” technology and its extensive use of robots. Uber was more focused on autonomous cars and trucks until recently when one of its self-driving cars caused a fatal accident, putting tests on hold.
The following infographic summarizes what they have done so far and what else they have planned. Which strategy will bring success?