Importance of Logistics Management & How Automation Can Help


Importance of Logistics Management & How Automation Can Help

According to Research and Markets, the global logistics market was valued at USD 9,525.1 billion in 2021. Aided by technological advancements, growth in e-commerce, increasing trade activities, and changing consumer behavior, the industry is expected to grow further at a CAGR of 5.7% between 2022-2027 and reach USD 13,326.3 billion by 2027. This unprecedented growth is pushing enterprises across different industries to understand the importance of logistics management and make it efficient. Read on to know more about it:

What is logistics and logistics management?

Logistics is an integral part of supply chain management. It includes storage, transportation, and delivery of either raw materials or finished goods from one place to another. Logistics management includes managing all the processes such that the timelines are not breached, business bottom lines are not hurt, and every logistics component works in a synchronous manner. It ensures the following seven Rs of logistics management:

  1. Right product
  2. Right quantity 
  3. Right condition
  4. Right time
  5. Right place
  6. Right customer
  7. Right price

Importance of Automating Logistics Management In Various Industries

Before we talk about the industry-wise benefits and importance of logistics management automation, let’s read some compelling statistics that reflect the significance of logistics management. The global supply chain market is expected to be US $31 billion by 2026; however, only 6% of businesses have complete visibility over their supply chain. As much as 81% of businesses believe data analytics to be a crucial factor in reducing logistics costs. Around 90% of fortune 500 companies use 3PL logistics services for their logistics and supply chain management. Now, take a look at the importance of logistics management and logistics automation, and hence, a logistics software solution,  in different industries.


Manually managing manufacturing operations can lead to challenges, such as the inability to optimize in-plant operations, poor operational visibility, high incidental charges, inefficient bidding processes, increasing transportation costs, poor ETA adherence, and more. A logistics software solution:

  • Facilitates seamless RFQ and inquiry management.
  • Sends automated alerts on shipment delays, transshipment aging, and completion of other processes. 
  • Keeps customers informed by sending automatic alerts via SMS/Email/WhatsApp.
  • Collaborate with designated CHA/Forwarder/Shipping lines to streamline the complete import and export process.
  • Minimizes cost leakages and offers end-to-end visibility across bulk shipments. 
  • Sends cost-based alerts on detention and demurrage.
logistics automation importance

Courier, Express, and Parcel

Courier, express, and parcel service providers find it difficult to cope with rapidly changing delivery demands and consumer behavior, offer different fulfillment models to their clients, and ensure operational flexibility, timely deliveries, and logistics sustainability. Logistics automation solves these problems by:

  • Streamlining first mile, line haul, and last mile processes.
  • Leveraging data and analytics to improve KPI benchmarking and drive accurate decision-making.
  • Designing optimal delivery routes, considering multiple constraints, for drivers. 
  • Utilizing delivery vehicles’ capacity completely and improving logistics visibility.
  • Making it easy to locate delivery addresses through advanced geocoding.
  • Driving seamless collaboration and communication among stakeholders.
  • Reducing customer onboarding time. 
  • Automating mid-mile trip creation, task allocation, hub pickups, and other tasks.

Freight Forwarders

Heavy reliance on paperwork, inability to communicate with businesses and vendors, tracking shipments, and adhering to changing regulations are some of the difficulties freight forwarders face due to the lack of logistics automation. An intelligent logistics management solution for retail brings automation and facilitates:

  • An automated RFQ system for sourcing rates.
  • Sending RFQs to all vendors for bidding in just one click.
  • Creating new shipment queries across full container load and port container load.
  • Real-time shipment tracking.
  • A dedicated portal to get RFQs and check rankings in the bidding process.
  • An online chat system for transparent communication.
  • Smart data and analytics to make data-driven decisions and measure different metrics.


Like other industries, the retail sector is also struggling to deal with high rates of returns, the inability to offer multiple delivery options, operational inefficiencies, increasing transportation costs, and more. Logistics automation empowers businesses to provide omnichannel fulfillment along with end-to-end supply chain management. The intelligent logistics solutions offer:

  • Auto-allocation of orders to the most efficient 3PL.
  • Automated route planning and optimization. 
  • Analytics and insights dashboard to track detention and demurrage and avoid incidental charges.
  • Real-time shipment tracking and carrier milestone alerts.
  • Arresting fake delivery attempts.
  • Unified communication in your own branding to your end-customers.

Quick Commerce

Players in the quick commerce domain experience problems like the inability to facilitate hyper-fast deliveries, dependency on manual intervention, dealing with massive order volume, inability to scale delivery operations, and more. Automating delivery management can overcome these challenges through the following:

  • Auto order allocation and dispatch
  • Real-time order tracking 
  • Smart order clubbing 
  • Intelligently assigning orders to a suitable driver
  • Offering multi-payment options 
  • Intelligent route planning and optimization   

Key Features To Look For In A Logistics Management Platform

Before we delve deeper into the features to look for in a logistics management platform, let’s check out different types of logistics software solutions:

  • International Logistics Management Software Solution
  • Route Planning and Optimization Management Software
  • First Mile Management Software Solution 
  • Middle/Mid Mile Management Software Solution 
  • Last Mile Delivery Management Software Solution 
  • Courier Aggregator Management Solution
  • On-demand delivery Management Solution 

To know more about each of these solutions in detail, read: Different Types of Logistics Software Solutions and Their Use Cases. 

You can choose to implement any of these solutions to automate components of your business’s logistics. However, using separate software for managing these components might not give you desired results. Therefore, you should implement an integrated logistics management software that facilitates complete logistics automation through features like:

End-to-end Logistics Management

Make sure the logistics software solution streamlines all three legs, i.e., first, middle, and last mile management. It should offer complete visibility of the operations and processes involved in the movement of goods from the source to the destination.

Automated Route Planning and Optimization

Route planning and optimization is an integral part of every business’s logistics and supply chain management. Therefore, the logistics software you choose should include this feature to optimize delivery routes based on the delivery location, delivery time window, real-time weather and traffic conditions, number of stops, and other factors. Besides, it should include dynamic route planning to accommodate last-minute changes.

Unified Management of All Courier Partners

It should offer a platform to manage and monitor all the third-party logistics partners your business is connected with. The smart logistics solution should also offer an auto allocation of orders to the best carrier based on multiple parameters defined by the business.

Freight Procurement

Auto-analyzing and comparing freight quotes from different shipping lines and freight forwarders should also be a part of the logistics software solution. The feature helps to get the best freight rates based on transit days, costs, and various other factors.

features of logistics management platform

Real-time Shipment Tracking

The software should offer a real-time shipment tracking feature to allow all stakeholders to get the updated status of the shipment. It helps to avoid incidental charges and get accurate ETAs. The software should also send automatic milestone alerts via SMS/WhatsApp/Email.

Data Analytics

Advanced data analytics drive intelligent business operations and ensure operational efficiency. By making data-driven decisions, logistics managers can predict problems and minimize delivery times, reduce overhead costs, increase fleet capacity, and more. 

Shipsy: AI-Backed Logistics Management Solution

Shipsy’s smart logistics management platform empowers businesses across industries to optimize and orchestrate end-to-end logistics management. The AI-powered solution can be seamlessly integrated into your existing ERP/WMS/OMS system and offer a 360-degree visibility of first, middle, and last mile operations.

Shipsy’s custom SaaS-based logistics management solutions simplify domestic and cross-border logistics to minimize shipping costs, digitize major logistics operations, and ensure the timely delivery of goods. It ensures:

  • 32% increase in mid-mile vehicle utilization
  • 12% reduction in freight costs
  • 37% decrease in ETA SLA breaches
  • 64% increase in customer experience
  • 34% decrease in incidental expenses 
  • 23% decrease in last mile delivery costs
  • 12% reduction in line haul logistics costs
  • 40% reduction in customer query calls per order
  • 18% increase in delivery net promoter score 

To learn more about the features and functionalities of our logistics management software solutions, click here. For a customized demo session, get in touch with our experts.


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