The COVID-19 pandemic forced consumers to turn to online shopping at record levels and the e-commerce sector will only continue growing. With so much demand, supply chains are struggling to keep up with demand.
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The COVID-19 pandemic forced consumers to turn to online shopping at record levels and the e-commerce sector will only continue growing. With so much demand, supply chains are struggling to keep up.
- Global e-commerce revenue reached US$4.9 trillion in 2021, which gave way to a historical 14% Year-over-Year (YoY) growth.
- The U.S. share of e-commerce sales in 2021 was 13.6%.
- China’s share of e-commerce sales in 2021 was 24%.
- Europe’s share of e-commerce sales in 2021 was 15.3%.
- Retail giants like Walmart and Amazon deliver products same-day or next-day, resulting in a standard that consumers expect.
“While human decision-making will be imperative for shipping freight well into the future, automation technologies that focus on cost savings and workplace safety are becoming increasingly popular in the maritime industry.” – Adhish Luitel, Industry Analyst at ABI Research
Key Decision Items
Use Automation to Streamline Yard Management Tasks
Automation reduces the costs of handling each container in a way that bolsters reliability, consistency, predictability, and security for supply chain leaders. Ports can automate many aspects of yard management, such as stacking and distributing, increasing throughput, and reducing workplace injury prevalence. Other yard management processes that supply chain executives and maritime leaders can automate include port gates, stacking cranes, horizontal transport, and quay cranes.
Bolster Fleet Management with Automated Guided Vehicles
Companies like VDL Automated Vehicles and Konecranes provide Automated Guided Vehicles (AGVs) to seaport authorities for transporting to seaport authorities for transporting containers from the dock to the yard, or to the trucks ready to be loaded. Many of the most productive ports in the world, such as the ports of Long Beach, Rotterdam, and Shanghai, all deploy AGVs.
Supply chain leaders should strongly consider the use of truck platooning, with small convoys of AGVs transport containers connected by a centralized cloud communication system. This allows for smoother traffic flow, fewer Carbon Dioxide (CO2) emissions, increased fuel savings, and safer transport across long distances.
Reach New Heights in Turnaround Time with Robotic Machines
Ports that introduce robotics are presented with an opportunity to automate container handling and truck loading around the clock, as opposed to the 16-hour dockworker shifts. Take the port of Los Angeles, for example, where 45-foot-high robotic machines from APM Terminals transport containers from ships to trucks. With the deployment of robotic machines, the average turnaround time for loading trucks at the terminal was cut down from 105 minutes to just 35 minutes. Plus, the inbound trucks spend less time idling, further diminishing the port’s carbon footprint.
Pivot to a More Interconnected Supply Chain
The future of the supply chain will be all about software and predictive analytics. Companies like SAP and Blue Yonder provide solutions for operational planning and accurate demand forecasting in a volatile market. Supply chain executives must also start thinking about how various devices and applications will intertwine to form a holistic view of supply chain visibility. Software like Huawei’s Smart Port Solution leverage Artificial Intelligence (AI), big data, and cloud computing to provide a digital management platform that accounts for all key assets—personnel, vehicles, goods, network, sensors, and other devices.
Install a Private Cellular LTE/5G Network
A personalized private cellular network with Long Term Evolution (LTE)/5G capabilities is the best choice for connectivity within a smart port. A private cellular network would not rely on nearly as many access points as Wi-Fi and the implementation handles moving objects well and can be tailor-made for a port’s unique needs.
These connections enable ports with the following abilities:
- Connection of Internet of Things (IoT) sensors, AGVs, and research equipment
- Terminal handling improvements
- Mobile voice communication throughout the terminal
- Mobile-enabled yard inventory applications
Prepare for Resistance from Unions
Seaport authorities considering automation technologies will need to think carefully about the ramifications on workplace morale, as dockworkers will fear job losses. To illustrate, coming to bargaining agreements has been a challenge for West Coast unions in the United States. When contract agreements can’t come to a happy conclusion, the already disrupted global supply chain will be exacerbated. As a safety net, companies should start the discussion of potentially rerouting their supply chain where union disputes are happening.
Carefully Decide if the Costs Are Worth It
The high investment costs associated with implementing and maintaining port automation may scare off key stakeholders. As a counterargument, the full breadth of benefits of a smart port must be explained thoroughly—increased productivity, lower labor costs, fewer workplace injuries, etc.
It’s true that only 5% of the world’s seaports are at least partially automated, with the biggest ports leading the way in adoption because they have the financial resources to do so. Seaport automation is far from being mainstream and may not even be the right solution at the time for some ports.
Key Market Players to Watch
Dig Deeper for the Full Picture
To learn more about how automation can modernize a seaport, download ABI Research’s Seaport Digital Transformation research analysis report.
Not ready for the report yet? Check out our following Research Highlights:
- Expanding Supply Chain Tracking with Returnable Transport Assets (RTAs)
- How Digital Transformation Fits into the Food and Grocery Retail Supply Chain
This content is part of the company’s Supply Chain Management & Logistics Research Service, which includes research, data, and ABI Insights.