Growing Your Logistics Business by Leveraging Technology
By Alisha Jernack
Electronic Data Interchange (EDI) EDI provides a standard and established framework for how data is formatted when sent, so that the EDI translation software of the receiver can receive and interpret it correctly.
This allows the transfer of data electronically between two systems, eliminating the need for manual processing and increasing efficiency in a range of industrial sectors such as transportation and logistics, distribution, manufacturing and utilities.
Application Program Interface (API) allows for the exchange of information between two or more parties, but unlike EDI, this exchange is instantaneous, readily available and does not follow a rigid framework. This allows businesses to customize what information they want to share and with whom and allows for integration across various software more easily and seamlessly.
With the market for shippers and third-party logistics companies becoming more global every year, companies must be able to adapt quickly to growing competition, customer demands and an increasingly complex supply chain. Shippers want to be able to get real time rate and quote updates, be able to easily track their shipments through the supply chain lifecycle and increase visibility to reduce inefficiencies.
While both API and EDI have different applications, they are not independent of one another and often work side by side to achieve the optimal result.
Visibility for the logistics lifecycle in recent years has changed from an additional perk to a necessity. There are many providers offering EDI and cloud-based SaaS APIs to help 3PL’s track their data and seamlessly integrate with the popular logistics software on the market today. While having accurate aggregated data is a necessity in today’s market, increased visibility is an added benefit.
Shippers can now search on these web-based applications for 3PL’s that offer competitive rates and are able to handle their needs in the time frame required, or maybe a customers is using the shipper strictly for heavy-haul and was not aware that they also offered storage, drayage and container solutions. Increased visibility leads to increased revenue, growth and customer satisfaction.
As a 3PL there are a lot of decisions that you must make based on the needs of your customers and the availability of your storage space and equipment. Perhaps you’d like to be able to see all your critical information from your warehousing, dispatch and truck electronic logging device systems presented in a dashboard setting.
An internal API solution would allow you to integrate all your data in one easy-to-view location. This will provide you with up-to-date, actionable data that can be used to reduce operational inefficiencies and optimize your logistical network uptime to generate additional revenue.
There are a lot of options on the market for software solutions, which can be daunting. Whether your business has a mature ERP system that is custom built or you’re a new business looking to expand into a more technologically sophisticated solution to manage your shipping lanes, there are a multitude of options to consider based on the specific needs of the individual business and what your future goals are.
Should you build a custom solution or use a prepackaged one? What will your cost be and how long before you are fully operational with the new solution?
While the shipping and logistics industry has been slow to adopt new technology, businesses that do are setting themselves apart from their competitors. The economy is now global, and shipping lanes may involve multiple parties who are all relying on real time, accurate information.
With the pace of technology integration into all aspects of business, customers now expect more granular information to be readily available.
Mazars’ technology and business consultants can address the specific needs of your business and offer an API or EDI solution tailored to your goals for the future, while being also providing best practices based on similar industries.
Our consultants work with management teams to help identify a cost-efficient solution that limits new technology business interruptions, allowing companies to quickly leverage the new tools for success.