Logistics Tech (Warehouse Logistics Technology) Market in Japan: Key Research Findings 2020
Yano Research Institute (the President, Takashi Mizukoshi) carried out a survey on the domestic warehouse logistics tech market and found out market trends by category, trends of market players, and future perspectives.
Summary of Research Findings
The logistics industry, which supports social infrastructures, faces the issue of manpower shortage more serious than other industries due to its labor-intensive nature, which has led logistics tech to draw attention as a solution to save manpower. Deployment of logistics tech has the advantage not only to improve work efficiency in addition to manpower saving, but also enables to digitalize logistics by shifting from analog management using paper. On the other hand, because of “costly expenses for system development and deployment,” and of “no in-house IT personnel for system maintenance,” the companies that deployed logistics tech have been limited to major companies with enough investment capital, having their own (or within their group companies with) IT department and personnel.
The conditions, however, have somewhat changed in recent years, as middle-size logistics enterprises have begun using logistics tech services, as more logistic-tech services have been generated, such as subscription services which require no initial cost, and outsourcing services for support and maintenance of services to cover the shortage of in-house IT personnel.
Yano Research Institute has assessed logistics tech services for warehousing which include cloud-based services, voice recognition, AI, and RFID by the following aspects: 1) Degree of deployment difficulty, 2) Appropriate warehouse size, 3, Trend in the COVID-19 calamity and 4) Investment size. As for 3) Trend in the COVID-19 calamity, the assessment is based on the frequency of inquiries at enterprises providing logistics tech during the period between April to December 2020, where “△” refers to the number of inquiries being leveled off. Despite that such a status can turn into growth in the long run, the assessment at this time has been regarded as somewhat low.
The systems that are assessed as “Early stage market” are as follows: Cloud-based WMS (Warehouse Management System) that manages incoming and outgoing of supplies at warehouses, berth scheduling and allocation systems that manage entering and departing of trucks, Tools for work visualization and for digitalization of daily job reporting that manage attendance and working conditions of workers, and voice/speech recognition that support various operations have been increasingly introduced since around 2015. For 2020, the COVID-19 infections have encouraged many enterprises to digitalize their business operations, which led the above systems to be stably adopted, partly because the degree of deployment difficulty was relatively easy.
Many of the systems categorized as “Seed stage market” such as AI and RFID, have been at the demonstration phase for being used for product inspections, stocktaking, picking, etc. Each logistics site is expected to go forward for full adoption in 2021.
Challenges Solved by Logistics Tech Deployment
The challenges at logistics sites and the advantages for using logistics tech are listed as follows:
■Serious manpower shortage, longer-hours of working continue:
-Logistics tech contributes in saving manpower by improving the work efficiency. As a result, it reduces cost.
■The management has been done by analog method, i.e. paper, which detered from information sharing and from data coordination across systems.
-Companies can digitalize their operation by deploying the logistic tech systems, allowing them to visualize and share information, and coordinate data across systems.
■Because the knowhow cannot be accumulated to workers universally, the work efficiency depends on individual efforts and workers.
-By making the knowhow of workers explicit, determination by AI will be available.
Significant advantages of logistic tech to the entire logistics industry are 1) shifting to paper (analog) to digital, 2) standardization of work (including basis making and rulemaking.)
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