How IoT can make sure goods get from A to B. By Ittay Hayut
It’s estimated that there are some 20 million shipping containers in the world that are actively transported from port to port. At any given time, there are approximately five million to six million shipping containers being transported by sea to and from various destinations around the world, making around 200 million journeys each year. The amount of cargo that is moving through the supply chain is exponentially multiplied when you take into account all that travel by air and land, in addition to this.
For most cargo, there is zero visibility – no one knows what happens in the supply chain, whether on sea, air or land. Of those containers listed above, roughly 1400 are lost at sea each year, with as many as 50 going overboard in a single incident. Cargo theft adds to the problem, costing the industry up to $30bn each year in the US alone. With so much lost packaging as prevalent as it is, organisations are increasingly demanding end-to-end supply chain visibility, in order to identify issues when they happen, and prevent problems from occurring. The alternative is faulty operations, losing customer loyalty and significant revenue loss.
In the air cargo industry, where $6.8 trillion worth of goods are shipped annually, there is too much at stake not to adopt the latest technology – even if the expense seems high. An inability or unwillingness to embrace digital innovations ends up costing more in the long run. Fortunately though, approximately 87 per cent of supply chain executives say they plan to increase their use of the Internet of Things (IoT) over the coming months and years. The trouble is that IoT is yet to go fully mainstream into the spectrum of business as decision makers generally lack both the knowledge around how the tech will be useful, as well as what type of IoT they need to make their business more profitable in the long run.
IoT is beneficial for the supply chain from end to end
The overarching benefits of connected IoT in the supply chain are worth the investment. With IoT, all objects in the supply chain, from containers to climate monitors to engine sensors, are able to communicate within one unified system, which makes incredible things possible, including full end-to-end tracking of goods travelling along a route.
One major problem that proliferates in the supply chain industry is in getting cargo from A to B in one piece. Far too many goods are spoilt or broken in transit, for example 40 per cent of all perishable products never make it from the farm to the table. Of course, there are many variables that contribute towards the amount of goods that go to waste, but as this NRDC report states, using the wrong temperature during transit and lengthy or disrupted transportation methods all increase the likelihood of damaged or wasted goods.
The data collected from IoT sensors can help to ensure the integrity of goods, however. From perishables such as food and beverages to life-saving pharmaceuticals, ensuring the optimal environmental conditions of products is key to bring reliable products to market that meet industry standards. By installing connected devices in pallets, organisations can receive real-time notifications of shipment conditions. For instance, if the temperature changes or if a pallet moves irregularly, the supply chain manager can trigger swift remedial action, thus saving those items from degradation or damage in transit.
This data, once collected, aggregated, and analysed, can offer much deeper intelligence into the entire operation that directs decision-makers to viable solutions in the supply chain. This insight can drastically improve efficiency, reduce costs, and drive up profits not just for the supply chain companies, but the wholesalers, retailers and suppliers that will eventually sell those products.
It’s important to note that “no single technology can address an enterprise’s full IoT requirements,” as noted within an IHS Markit whitepaper as far back as 2017. “Consider tracking moving assets in the supply chain; a cargo container tracking solution may involve satellite connectivity at sea, cellular at dockside, RFID while passing through checkpoints and Wi-Fi when in a distribution centre.” This is why it is crucial that companies integrate solutions that can utilise all multiple technologies, but this is not without its complexities. Having a device that solves all of these problems is too expensive for many logistics companies, because common solutions use a great deal of power and are inefficient. For these reasons, not many organisations have adopted these technologies thus far.
How to make IoT sustainable
The most ubiquitous geolocation technology currently used for IoT tracking is the Global Positioning System (GPS). This has its benefits for the tracking of vehicle fleets and products in transit. However, for the tracking of non-motorised inventories and shipment of goods, GPS still leaves a lot to be desired, particularly across lengthy supply chains.
Currently, when compared with its radio frequency-based alternatives, GPS requires a significantly higher amount of power from the tracking device. Using GPS drastically increases costs to run the equipment, rapidly drains battery life and, most importantly, its functionality is heavily reduced when used indoors. This is extremely limiting and costly for a retail business with a sprawling supply chain and a number of warehouses for storage. Knowing exactly where your shipment is and when, and having visibility over the quality of the products inside, is paramount to maintaining control and making sure that goods get safely from A to B. But if tracking devices frequently need to be replaced or recharged, the whole supply chain is disrupted.
And yet, while IoT deployments remain in their infancy, GPS is still the prevalent geolocation system in use today. New technologies and service providers have continued to emerge in recent years, although the uptake of IoT cargo monitoring remains modest. Barriers to IoT adoption in logistics have long been known, but until LPWA (low power wide area) technology there was no alternative solution for the whole supply chain.
Clearly this must change for supply chain managers to reap the benefits offered by low-power IoT-based tracking, and it will. LPWA communication protocols combined with GPS-independent positioning technologies can do so for a fraction of the power. This has been achieved by using LoRa™ (a long-range wireless communication protocol) data transmissions to calculate a product location and track it both outdoors and indoors. This uses very little power, ensuring the device tracking the product has a significantly longer battery life with little need for recharging or replacement. This saves time on maintenance, therefore reducing staff overheads.
Since IoT can be used anywhere and everywhere, its potential is limitless – especially when the solutions that it works with will only get better. Previously, IoT tracking has been an expensive investment that only some of the wealthiest retailers could afford. Now, LPWA tracking is so affordable, it’s a technology most retailers cannot afford to ignore. In the coming years, IoT will continue to solve more problems and improve efficiency in the logistics industry. To reap those rewards, supply chain leaders need to pair their tangible assets with IoT empowered by LPWA, and intelligently put it all into action. This will generate visibility, which in turn will create datasets to provide valuable insights into how their goods are being moved from A to B, leading to better decisions made by a logistics company’s leadership team.
After all, a highly-informed decision is the best decision.
Ittay Hayut is CEO at hoopo. hoopo is redefining geolocation technology, delivering high-accuracy yet low-power location capabilities to the Internet of Things (IoT). Based in Israel, hoopo is working with companies worldwide to enable new applications that require more advanced geolocation technologies. hoopo is designed for LPWA networks and sensors, delivering high-accuracy geolocation, combined with long battery life, and the backing of a rich partner ecosystem.