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Logistics Costs Increase After a Decline in the Previous Year

Posted by Sean Murphy on Dec 31, 2018

For the first time since 2009, U.S. business logistics rates
are on the rise, up 6.2%. This is according to the 29th Annual State of Logistics Report. What had the
biggest impact on costs? The main contributors were a prosperous economic
climate combined with demand, a strong job market, increased wages and a shortage
of more than 50,000 truck drivers. This all resulted in a 7% increase in
freight transportation costs over the previous year.

Experts are using these numbers and behaviors to predict
what may happen in the future of the logistics industry. They believe costs
will increase again due to interest rates, tight labor and higher fuel prices.
In addition, they feel corporate tax cuts will boost the demand for logistics
services.

New technologies could also impact the logistics industry,
with more companies challenging old business models. A trend that could shape
the future of logistics will be a fully digital, connected and flexible supply
chain. This next-generation software will drive efficiencies through big
data-type of technologies such as predicative analysis, artificial intelligence,
robotics and smart vehicles.

Panelists at the press event related to the release of the
report was mostly in agreement that the logistics industry is entering a new
era, where innovative technology may temporarily help companies lower
costs.

Another variable contributing to increased logistics rates
is cargo theft. According to Port Technology, the average value of a single theft
in North America is more than $65,600 USD. Experts predict that cargo theft costs business billions of dollars every
year.

Cargo thieves are opportunists. So, what can management do
to help deter them? Because many cargo thefts are committed by people on the
inside, one of the first things businesses should do is to thoroughly screen
employees. Another recommendation is to utilize technology for shipment
tracking, vehicle immobilization, as well as proactive security.

A proactive security solution combines technology with human
intelligence. Strategically placed surveillance cameras are equipped with video
analytics that will alert trained security operators of unusual activity on a
property. The operators can make judgement calls on how to best handle the
situation. They can activate speaker warnings to let trespassers know they are
being watched, contact an on-site guard or call local police. An added benefit
of Stealth’s proactive security solution is access control capabilities. Click
the video to see how access control can help decrease theft and property damage
at logistics sites.

The logistics industry is facing many challenges. Among them
are higher rates and cargo theft. Live video surveillance may help offset some
of the costs associated with theft and mismanagement of inventory.

If you would like more information about what this proactive
security solution can do for you, contact us here.