Our team at Morai Logistics hopes everyone has had a great holiday season! We decided to kick the year off our blog by focusing on the logistics and supply chain industry that is predicted to radically shape the face of the industry for 2014: Hardware.
Both Forbes and Director of the MIT Media Lab, Joi Ito, have deemed that 2014 is the start of the tech industry, especially the start-up crowd, to move away from the cloud and digital product and services and to move onto concrete real world devices that we can interact with.
While this presents a new challenge for these start-ups and veteran tech companies, primarily due to considering factors that haven’t been looked at thanks to the rise of digital services blooming in the tech market, the logistics industry can rejoice! Many potential opportunities are opening up for the logistics and supply chain companies, predictively those in 3rd party logistics, due to the need for these new hardware devices to be sent out to consumers. Warehousing and transportation services are looking to be in demand for the tech industry for 2014 and onward as these new hardware ideas come into fruition.
The Opportunities
There are a couple of factors that have made entrepreneurs in the tech industry strive for manufacturing devices and indeed the first and foremost is the increase in the practicality of computing devices. As can be seen in most of our pockets and purses, we currently are surrounded with an extremely powerful computer that fits in the palm of our hands. If anything is a great example of today’s advancement in hardware technology, one need not look further than that. Our cell phones have reached a point where we really can use it for most of our digital needs and conveniences.
Another potentially strong factor that has given rise to new ventures in hardware and straying from software is the fact that a lot of start-ups really tried to jump on the app bandwagon. Nowadays we are nearing app saturation and a culture has been created within the community where users are starting to become more conservative when it comes to downloading new apps. This hard resulted in a downward spiral as app developers need to feed themselves and have resorted to creating in-app purchases and reserved ad space which decreases the quality of user experience.
Thus developers now have taken to hardware, as it is assumed that hardware is something that should be paid for by consumers. It makes the work that the developers put in much more predictable with regards to their profitability.
The Challenge
It seems that while these opportunities have presented themselves for the logistics and supply chain industry despite the predicted slow growth in the industry for the coming years, it isn’t without some challenges.
The primary obstacles that these new tech companies are facing are where to manufacture these goods. China seems to be the standard option because of the readily able workforce and experience in tech development, but it seems more and more that nearshoring is the way to go. Places like Mexico offer an equally ready workforce and is much closer to the majority of these tech startups (primarily US). Meanwhile, manufacturing hubs in within the US itself are starting to trend as well.
The biggest concern though is logistics. Our industry faces a major problem of staff shortage when it comes to transporting goods. Nowhere is that more present that with our trucking workforce, as recent statistics have shown that 17% of the current truck driving population is under 35 and a larger proportion is close to retirement. Thus, should the demand present itself, our industry will have to come up with solutions to get these new digital goods across.
On a lighter note, the advent of 3D printing might have an impact on the way devices are manufactured in the future. Thoughts?
That’s it for us this week! If you liked this blog post, why not subscribe to our blog? If you’re interested in what we do as a 3rd party logistics provider, don’t hesitate to check out our services (as expressed above, we are very pro finding you the lowest total cost!). We’re also in the twittersphere, so give us a follow to get the latest logistics and supply chain news! Have a great rest of the New Year week, we hope for a great start to 2014 for all of our readers!
