FOR GETTING FROM A TO B

ViewPoint: Logistics

Logistics in Australia

This ViewPoint article is an exploration of the challenges and opportunities being seen in the evolving and growing logistics industry.


The market

Australia’s transport and logistics industry generates approximately $201b a year in revenue, accounting for 15% of GDP (1). The industry is poised for significant growth, thanks to a rebound in global economic conditions. As such, rising demand from a broad range of industries will require logistics operators to support a range of door-to-door delivery, transport, storage and distribution services.

 

The industry is in the midst of immense structural change. Technological developments are presenting many opportunities to value add, and are seen as a key driver of sector growth. However, competitive forces like these are putting pressure on individual and smaller participants, with larger players better able to invest in and adapt their operations to keep pace with market expectations.

 

Be that as it may, these facts and figures, however interesting, are not the focus of this article; we want to explore the evolving ways logistics operators are connecting with brands and consumers alike to help them build their own business and reputation.

 

By examining the changing behaviour of consumers and the evolving marketplace, we’ll explore the opportunities open to the logistics industry as technology disrupts this essential and dynamic sector.

Business & Consumer expectations

Today, businesses are not just looking for ways to streamline operations.

 

They’re also striving to ensure brand continuity by teaming up with innovative partners along the supply chain to ensure quality standards and an enhanced customer experience. 

 


The information that traceability systems capture can potentially be shared with consumers in order to improve confidence and brand loyalty. (5) Companies like Frequentz are responding to this, developing business-critical ‘track and trace’ technologies that deliver better visibility into supply chain processes. From agriculture to automotive, pharmaceuticals to food, they are designing solutions that are meeting the demands of a world where doing business needs to be not only safe and traceable, but also where brand integrity is protected.

 

Online retailers outsource almost all of their logistics functions, and while they are a relatively small part of the retail trade division, they are forecast to grow strongly in the next five years. (2)

 

Clipper Logistics has seen successful at offering innovative solutions, such as their ‘Boomerang’ returns management for the retail industry in the UK. Steve Parkin, executive chairman of Clipper, said, “The group is proud to be continuously recognised throughout the UK’s retail sector as a leading provider of value-added logistics and e-fulfilment solutions and this is reflected in our latest set of full year results”. (3)

One example is DPD in the UK, which launched its ‘Predict’ offering in 2010.  Using SMS or email, Predict gives parcel recipients advanced notification of a precise one-hour delivery slot. This award winning feature has been directly responsible for over £178m of new business, making the DPD the fastest growing major delivery firm in the UK, and firmly establishing the company as the carrier of choice for premium brands in the home delivery sector. CEO Dwain McDonald commented, “Retailers can clearly recognise that DPD’s innovations give them a genuine competitive edge and the opportunity to add real value to their customers in the delivery phase.” (6)

 

Today, it’s no longer enough just to deliver from A to B, safely and on time.

 

Logistics operators have to work hard, innovate and prove to brands and consumers alike, that they are convenient, reliable and cost effective.

Takeouts

Brand perception matters. From the tone and manner of a customer service representative to a driver’s appearance at the dock, every touchpoint needs to deliver on a brand’s values. Logistics providers need to ensure positive, brand-enhancing policies and activities are a key business focus.

 

Customer service driven innovations will be key in achieving a genuine competitive edge and will provide an opportunity for logistics operators to add real value.

 

Social media is an important channel for relationship building. Logistics operators can take advantage of this channel to build connections with consumers by responding and reaching out to them and by becoming a part of their everyday experience.

 

We love working with businesses who aim to connect with their customer base on a meaningful level. And we build brand identities, communications and experiences that do justice to that aim. 

The opportunity 

In Australia, smart brands of all sizes are looking to outsource their logistics. These companies are aware that by outsourcing logistics, they are able to focus on what they know best: their core business. It stands to reason that only companies engaged in the business of logistics are best equipped to keep up with the constant changes, evolutions and demands of the logistics industry.

 

This provides opportunities for a range of logistics operators in Australia.

 

Businesses, from retail to agribusiness and in between, are increasingly looking for reliable logistics partners to help build their brands. Some businesses will be looking for niche logistics providers who have developed specific, innovative ways to add value, while others will seek out ‘one stop shop’ operators with global scale and multi-modal capabilities.

 

These are exciting times in the highly competitive logistics market. Operators in Australia not only need to innovate, they need to differentiate themselves and win the hearts and minds of businesses and consumers. To do this, they need a strong brand identity, or ‘reputation map’ that aligns to their business strategy and guides the entire organisation from the inside out.

 

We see great potential for logistics operators in Australia to build their brands and to create recognition and trust by showcasing the value of their offering. And, by engaging their target customer base in relevant and meaningful ways, they can become front-of-mind with investors, partners, employees and consumers. Ultimately, they can become logistics operators of choice in this evolving and growing industry.

Sources and reference (1, 8) Ferrier Hodgson TRANSPORT AND LOGISTICS INSIGHTS The road ahead (2, 7, 9) IBISWorld Industry Report X0016 July 2015 (3) Clipper Logistics sees profits soar, Tuesday 28 Jul 2015 12:20 (4) Frequentz Inc.’s Mobile App is a Track and Trace Industry Game Changer (5) http://www.fmi.org/docs/food-safety/fs13-traceability-backgrounder-docx.pdf?sfvrsn=2 (6) http://www.dpd.co.uk/content/about_dpd/awards.jsp (10) CILT Annual Logistics Conference 2015
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