Why Custom Software Development Is Better for The Logistics Industry

Today’s immensely dynamic and interconnected world sets high requirements for companies from all industry domains and the logistics sector is no exception.

The logistics industry is experiencing the most profound transformations due to the digitization of many processes from goods storage and delivery to transportation management. Therefore, logistics companies have to obtain the software that would effectively handle their operations such as warehouse filling, transportation management, finance operations, data processing, and many others.

Although there are many off-the-shelf solutions available, still many companies prefer creating their own logistics software solutions. In this article, we explain how businesses can benefit from digitizing their logistics operations and when it’s better to develop a custom software solution over off-the-shelf.

How Digitization Is Transforming Logistics

Logistics digitization is a comprehensive process that affects all sectors of this industry. Many businesses are leveraging logistics digital solutions to keep the competitive edge in the highly volatile market.

The Logistics industry has already experienced some level of digitization so far and is proceeding with it on different levels:

• data management is empowered with various data collection and processing apps, diverse software for supply chain control and management;
• physical transportation utilizes robots, drones, Internet of Things (IoT), and driverless vehicles for goods management and delivery;
• marketplaces – digital marketplace platforms connect potential buyers and sellers with the help of cross-border commerce platforms and foster businesses to use their resources more accurately through sharing platforms, e.g. shared transport/ warehouse capacity, etc.

The core logistics areas that undergo digitalization are:

• Inventory management 

It allows managers to quickly track each inventory position using Barcodes, RFIDs, or QR-based systems. Apart from real-time tracking it also shares some extra data on each item, e.g. its value, status, condition, etc. With inventory management software businesses can optimize their costs, improve the delivery time, and stay updated on each item’s current state.

• Transportation

It can be rather challenging for a company to track all the goods shipments manually. Transportation allows performing simple fleet management, making the process less labor-intensive and less error-prone. Besides that, vehicle tracking management software helps logistics companies to calculate the best routes for fast and inexpensive goods delivery and create multi-channel shipping routes.

• Supply chain management

Supply chain management allows businesses to control and manage the flow of their goods and materials from the point of origin to the end-users, cutting the necessity in middlemen and, therefore, reducing product costs. Above all, companies can track the production-shipment-distribution chain of their products and share this data with their consumers, improving product transparency and customer satisfaction with the products.

• Order management

With order management software, businesses get access to up-to-date data on the stocks and transport load, and can automate the order tracking and placement processes for themselves or their business partners. As a result, companies can optimize the use of their resources and provide their clients with the latest data on the products, transportation, storage space, and others.

• Warehouse management

For some businesses, it’s essential to have warehouse management as a standalone feature in their software solutions. It gathers all the tools related to warehouse management in one place and helps companies optimize the use of their warehouses. These tools can include price customization, creation of quick invoices, sending notifications, barcode scanning, improved packing, and others.

• Internal processes

For effective logistics management, some companies include in their software the functionality that helps them to perform faster routine processes. For example, it can be billing automation, automation of transportation and warehouse documentation, visual tracking of all manufacturing and transportation stages, seamless integration with other software, data sharing between various departments, and others.