Breaking down the top four trends set to influence road transport and logistics in 2024

The realm of transport and logistics has had a wild last four years. Disruptive factors include the COVID-19 pandemic, technological advancements (particularly in AI), economic conditions, geopolitics, climate change, regulatory shifts, and the increasing demand for digitalisation in the industry.

These challenges continue to shape and influence the sector globally but morph into new shapes that may take time to recognise. With help from logistics experts at Descartes Systems Group, TechHQ clarifies four central emerging logistics and transportation trends set to influence business success in 2024.

1. Labour shortages

A recent Descartes study found that 76 percent of organisations are experiencing notable workforce shortages. The road transport sector specifically faces a pressing challenge with a shortage of HGV and van drivers, disrupting the timely delivery of goods across various industries. Manufacturing, healthcare, and e-commerce sectors, all heavily reliant on transportation, bear the brunt of this. To counteract its effects, companies must consider investing in driver retention initiatives and competitive compensation packages. The latest route optimisation software will also help to maximise delivery capacity without adding new drivers or vehicles. In the future automation solutions like autonomous vehicles for efficient last-mile delivery operations may become the norm.

2. Rising costs

Escalating expenses, encompassing labour, fuel, and raw materials, will impact businesses’ bottom lines in all sectors. Experts say that the price of diesel is poised to rise sharply in the coming year, impacting the bottom line of many companies that rely on road transport. Manufacturers are likely to see elevated production costs, whereas service industries could grapple with increased operational expenses. Effective cost management strategies such as process streamlining, enhancing supply chain efficiency, and astute sourcing practices will be imperative for businesses. Additionally, embracing sustainable methodologies and integrating energy-efficient technologies can provide long-term relief from cost pressures.

Source: Descartes Systems Group

3. Customer experience

The so-called ‘Amazon effect’ – where customers put more pressure on their supplier to know where their product is – has pushed customer expectations in logistics and home delivery to new heights. A Descartes study in 2023 revealed that 67 percent of consumers experienced a home delivery problem in the three-month period surveyed, and 68 percent took some form of action against the retailer or delivery company. Adapting to these expectations means that retailers should offer a range of costed delivery options and implement tighter time windows for deliveries.

Monitoring driver performance and providing real-time delivery status information to customers based on accurate GPS location data will help to manage proactively expectations. Ensuring third-party delivery agents reinforce the retailer’s brand and delivers to the same standards is essential. Businesses can enhance the overall customer experience by focusing on these areas, driving their respective industries’ satisfaction, loyalty, and competitiveness levels.

4. New business models

Companies are urged to embrace new business models centred around innovative logistics and electronic customer engagement in response to the imperative to reduce costs and enhance customer satisfaction. Distribution industries are transitioning from fixed delivery cycles to hybrid routes, improving cost-efficiency and service responsiveness. These adaptable models hold promise for replication across all sectors. Additionally, adopting eco-friendly delivery options, such as consolidating orders for weekly delivery and leveraging technology to identify more sustainable delivery routes, not only meets growing consumer demands for environmentally conscious practices but also contributes to cost reduction. As delivery strategies evolve, logistics leaders are encouraged to seek inspiration beyond their sector and seize new opportunities.

Meeting these challenges with digital transformation

Meeting the above challenges to drive success in 2024 and beyond necessitates a new approach accessible through digitisation. For example, by harnessing advanced analytics, AI and machine learning, companies can gain comprehensive insights into fleet operations, optimising routes and resource allocation to effectively navigate labour shortages and rising costs.

Integrated customer engagement platforms provide clients real-time updates and self-service options, fostering transparency and trust while reducing operational strain. Furthermore, proactive drivers’ hours management, coupled with innovative mobile solutions, ensure a culture of safety and compliance, mitigate risks and enhance overall operational efficiency.

Source: Descartes Systems Group

The unique needs of high-volume carriers can be met with enhanced strategic and operational modeling capabilities. Integration with tachograph remote download devices enables intelligent route planning, ensuring compliance with drivers’ hours regulations while optimising resource usage. State-of-the-art load optimisation software enhances load-building accuracy, maximising payload capacity and minimising transportation costs.

The Descartes effect

Descartes route optimisation and delivery scheduling software offers transport operators and fleet managers an integrated solution to help address the challenges of labour shortages, rising costs, poor customer experiences and outdated business models. Descartes is seen as a trusted advisor for thousands of fleet operators, driven by the success of its customers. Global brands like Royal Canin, Ontex, and Sonepar – each with fleets from 15 to thousands of vehicles – have found savings and enhanced customer experiences by employing software solutions that optimise their logistics and fleet management processes. Schedule a consultation with the expert team today to discover how Descartes can take your business to new heights in 2024.