September 20, 2021

ForkliftDriver400x275In a new study of third-party logistics (3PL) providers and other supply chain leaders, only about one in three either have invested in or planned on investing in robotics or other automation technologies. Instead, other technologies such as digital twins, intelligent data analytics (through AI or machine learning), Internet of Things and 5G wireless were on top of mind.

The 2022 Third-Party Logistics Study was done in conjunction with NTT DATA and Pennsylvania State University’s C. John Langley, clinical professor and supply chain information systems and director of development at the Center for Supply Chain Research at Smeal College of Business. Sponsored by Penske Logistics, the study can be accessed here, and is part of an in-person session at the Council of Supply Chain Management Professionals’ EDGE conference in Atlanta.

In terms of technology investments for the next three years, more than half of shippers (52%) and 63% of 3PLs said 5G technology is either moderately or critically important. About 63% of 3PLs stated they are investing in IoT technology to improve workforce productivity, real-time decision making and create a competitive differentiator.

In terms of future technology investments, respondents were asked whether they’ve invested in the technology in the last three years, are currently investing in, or plan to invest within the next three years, or have no plans to invest. In the category of no plans to invest, robotics topped the list:

  • Autonomous trucks (80%)
  • Autonomous Yard Jockeys (83%)
  • Drones (75%)
  • Autonomous forklifts (70%)
  • Smart Warehouse – Warehouse of the Future (61%)
  • High-dense storage, pickers or palletizers (60%)
  • Wearables for workers or drivers (59%)
  • Productivity Sensors (59%)
  • Smart Factory – Industry 4.0 / Factory of the Future (58%)

The study did say that in order to obtain a return on investment (ROI), some technologies, such as each-pick robotics, require a time commitment that runs longer than a standard three-year contract. “Technology providers are increasingly realizing the obstacles 3PLs face with securing a ROI and have embraced a lease program to make technology investments more practical and payback periods more relevant,” the report stated.

For example, Penske Logistics recently utilized leasing (also known as robots-as-a-service) to outfit a warehouse with each-pick robotics. “Some of the providers are getting creative in terms of how they allow companies like ours to consume these technologies,” said Andy Moses, senior vice president of sales and solutions at Penske Logistics. “That is an evolution that the emerging tech industry is realizing.”

On the other hand, respondents are showing much more enthusiasm towards 5G technology, with 55% reporting they plan to invest between 1% and 10% of their annual IT budget to 5G rollout and integration, with 41% saying they have no plans to invest in 5G in the next five years.

The study also covered issues such as sustainability, the cold chain, and effects of COVID-19 on the supply chain. The study is available for download here.