Market Overview

While indispensable for social infrastructure, the logistics industry has been suffering from labor shortage more seriously than other industries because of its labor intensiveness, making logistics tech that focuses on saving manpower to gather attention. Deployment of logistics tech has the advantages not only of improving work efficiency in addition to manpower saving, but also of shifting from analog management using paper to digitization of logistics. On the other hand, because of “costly expenses for system development and deployment,” and of “no in-house IT personnel for system maintenance,” those businesses having deployed logistics tech are limited to major companies with enough investment capital, having their own (or within their group companies with) IT department and personnel. In recent years, however, such a situation has changed, and standard-packaged SaaS-based systems at affordable prices have become widespread, which propelled deployment at mid-tier businesses.

This press release covers increasing deployment of berth reservation/acceptance systems that manage incoming and out-coming of trucks into a warehouse, as companies foresee the “2024 Problems” that are to be occurred when work style reform-related laws for truck drivers to be enacted in April 2024, restricting the maximum overtime work to 960 hours per year and raising the extra wages for overtime work.

The market size for berth reservation/acceptance systems based on the number of bases implemented in FY2021 was estimated to 1,100 bases, 169% of the previous fiscal year. While the deployment slowed down temporarily in FY2020 due to COVID-19 pandemic, it considerably grew in FY2021 because of the recovery in eagerness to invest in the logistics business and because of the purpose to alleviate the burdens of truck drivers with “2024 Problems” in mind. During FY2021 and the first half of FY2022, there was a tendency of businesses with multiple bases having succeeded in improving the trucks’ queueing time and congestion from queueing by implementing a berth reservation system at one base to make horizontal development in implementations to other bases, which increased the number of bases with berth reservation systems implemented. The market size is projected to rise until FY2024, and the growth is expected to become gradual after that.

Noteworthy Topics

WES (Warehouse Execution System) Gathering Attention While Automation at Warehouses in Progress

A Warehouse Execution System (WES) is a hybrid software system positioned between a Warehouse Management System (WMS) to manage inventory and a Warehouse Control System (WCS) that performs material handling and robot controlling in a warehouse. There are following two factors for WES to draw attention:

1) With automation in warehousing tasks underway to improve productivity, the systems within warehouses have come to require flexibility, as they have various options to do such as material handling, robot controlling, voice recognition, etc.
2) If each task of material handling and robot controlling as well as management has been done by using WMS and WCS, there is a challenge of not being able to manage the entire warehouse productivity.

In order to solve these challenges, the WES implementation and development have started. While WES has been established as a standalone system in Japan only shortly, it is essential to change the logistics sites flexibly to adapt to the external environmental changes and technological advancement. The deployment of WES is expected to expand mainly in new bases and large-scale bases.

Future Outlook

From the logistics tech deployment statuses, it can be judged that digital transformation in logistics has just entered a digitization phase. To be specific, as “shifting from analog tasks to digital management” and “visualization of current status via digital management” have been in progress, and it has now started moving into the phase of “streamlining of sites”. In order to generate new added-values from data and to press ahead with digital transformation in logistics to achieve innovation, standardization within warehouses and digitization in SMEs are necessary. Currently, digitization of logistics is underway in large and mid-tier companies, and barely in SMEs, meaning that they can “hardly capture data”. Because the requirement in digitization differs between large or mid-tier companies and SMEs, how to help explore the necessary systems and services to these businesses will lead to expansion of the logistics tech market and consequently, to advancement in logistics digital transformation in the whole industry.

Research Outline