Why does Logistics Technology Matter?

The marketing technology’s global market size is logistics tech’s seven times the size. This gap is filling quickly. Martech is now a market worth $121.6 billion globally, serving a nearly $5 trillion global e-commerce market. The logistics industry is extensive and measured as a GDP percentage. Estimated Global logistics is 13% of the GDP, equal to $9.7 trillion. Besides, logistics tech is a $17.5 billion market globally. That’s an insignificant 0.19% investment in tech and 1/14 of the 2.44% tech investment on the front-end.

Kashyap Deorah, Founder/CEO of HyperTrack, said that when he was running the e-commerce business, the top executives believed that retail is all about price and product. If clients get the right commodities at the right cost, they win. They believed this principle applied across different channels. 

Logistics

Technology investments in logistics were moderately lower, with many of the supply chain operations conducted manually. Moreover, technology investments involved daily planning the realization of products and services.

In his 1997 shareholder letter, Jeff Bezos mentioned that they would make a sustained investment in operations and infrastructure to promote excellent customer service in addition to preference and price.

In a 2008 letter to shareholders, he said that they have a strong belief that consumers value low costs, broad selection, and quick, comfortable delivery in their retail business. He added that these needs would remain stable after many years ahead. Therefore, Amazonian e-commerce shifted its retail supply chains from distribution to satisfaction. It resulted from heavy technology investments preparing warehouses and transport to deliver each order to customers. In fact, it moved from just taking goods from warehouses to stores.

Retailers that have a relationship with customers partner with on-demand apps for logistics. They do that despite disintermediation risks. Smaller retailers moved to commission-free tech platforms that have the ability to solve the front-end difficulties as an online system.