Amid the growing global importance of logistics due to the unprecedented boom in e-commerce operations brought about by the pandemic, ideas about how the future of logistics is set to shape itself within the New Normal era have been drawing attention.
Leading Industry Trends: CJ Logistics at Seoul Smart Mobility Expo
At the Seoul Smart Mobility Expo 2021 (SSME) event on June 11, 2021, Ahn Jae-ho, Senior Vice President at CJ Logistics, made an in-depth presentation. Titled “Logistics Industry Trends in the New Normal Era and CJ Logistics Case Studies”, the presentation focused on the unprecedented changes in the logistics industry that have been brought about by the pandemic.
As part of his presentation, SVP Ahn proposed four keywords that the industry should focus on going forward in the New Normal Era: e-Fulfillment, Last Mile Delivery, Digitalization and Resilience.
Regarding the first keyword, e-Fulfillment, SVP Ahn explained that the demand for e-fulfillment has been increasing in order to be able to respond quickly and accurately to the rise in online orders being made by consumers. E-Fulfillment refers to a service where distributors or logistics companies store products on behalf of online sellers and deliver the product immediately through the process of selection, packaging and classification as soon as a customer places their order.
For example, CJ Logistics offers a convergent e-Fulfillment service that allows for a customer’s product to be delivered the next day, even if they order up until midnight the day before, at Gonjiam Mega Hub, Asia’s largest parcel hub. This is possible because they stock their e-Fulfillment center with e-commerce clients’ products in advance so that the moment a customer places an order, the product can be taken out and delivered to a customer right away.
The second keyword, the Last Mile Delivery, refers to the final step of the delivery process in which goods are delivered to consumers. This has become a topic of increasing importance as consumers’ delivery requests, from ‘safe’, ‘fast’ and ‘customized’ to ‘contact-free’ and ‘eco-friendly’, have been increasing just as the amount of online orders being made has. This has resulted in the diversification of Last Mile Delivery services, which now includes early morning delivery, same-day delivery, immediate delivery and date-designated delivery.
Digitalization within the logistics industry is a trend that has been accelerated by a decline in labor supply and companies cutting costs due to COVID lockdown. Digitalization is being favored by logistics companies as it helps them meet increases in demands while reducing costs.
The adoption of robotics and automation equipment at each stage of the logistics operation process is expected to continue to grow due to concerns around labor supply suspensions, the need for rapid order processing caused by an increase in the number of goods transported and the need for further improvement of accuracy and cost reduction. CJ Logistics’ automation technologies, which include an advanced picking system with distribution centers, an automatic packaging system with packaging box recommendation and a multi-sided barcode scanner, were examples of solutions introduced by SVP Ahn during his presentation.
Finally, as corporate clients switch their global supply chains, the need for logistics companies to strengthen their resilience has become more important than ever before. Within the logistics industry, the ‘Just in Time’ method traditionally focuses on a company’s procurement – production – sales process. But use of the ‘Just in Case’ method, which puts emphasis on the importance of rapid resilience to prepare for any unexpected situation, has been expanding hugely in the New Normal era.
SVP Ahn also noted that logistics companies will have to come up with backup plans as companies expand and reorganize their global supply chain to prepare for country lockdowns and the disruption of operations in manufacturing sites brought about by COVID-19. The solutions include reinforcing the visibility of inventory management and cargo movement using air-maritime connected shipping, the Trans-China Railway (TCR) and the Trans-Siberian Railway (TSR).
SSME 2021 was hosted by the city of Seoul at the Mapo-gu Oil Tank Culture Park (formerly Mapo Oil Depot) from June 10 to 12, 2021 and featured various exhibitions and presentations under the theme of the ‘Smart City Created by Mobility Innovation’.
