HOW START-UPS DIGITALIZE LOGISTICS 2018 THE … · how start-ups digitalize logistics –2018 the...
Transcript of HOW START-UPS DIGITALIZE LOGISTICS 2018 THE … · how start-ups digitalize logistics –2018 the...
© Oliver Wyman
HOW START-UPS DIGITALIZE LOGISTICS – 2018THE ACCELERATION OF DISRUPTION
TRANS AKTUELL SYMPOSIUM
APRIL 2018
1© Oliver Wyman
An Industry destined for digitalization
High volumes
Low profitability
Need for but lack of
harmonized systems
New Digital
technologies
• High number of transactions every day
• Large amounts of data
• Opportunity for automation of processes
• Mostly commoditized industry
• Many logistics sectors with low profitability
• Few defined IT standards
• Frequently, multiple IT systems within one firm
• Increasing need to harmonize logistics IT with client IT
• Data-and software-driven technology, e.g. Big Data, Blockchain, ...
• Hard- and software-driven technology, e.g. Telematics, Drones, Robotics
2© Oliver Wyman
break-through of new, digital business models
Examples
DIGITAL
MARKET PLACES
E-FORWARDING
DATA-BASED
SERVICES
ASSET-LIGHT
DISTRIBUTION
AUTONOMOUS
TRUCKING
DIGITAL
WAREHOUSE
• Matching
• Optimization of utilization and routing
• Value-added services for truckers/ carriers
• Focused on standardized transport services
• Optimized UI/UX
• Automation of logistics processes
• Data infrastructure for SME logistics providers
• Commercialization of logistics data, e.g. insurances
• «Uber for Freight»
• Intermodal last-mile distribution
• Booking platforms for Platooning
• Fleet management for autonomous trucks
• Capacity management across multiple warehouses (on-demand)
• Automation of contract logistics services
Source: Oliver Wyman
3© Oliver Wyman
Digital and hybrid forwarding business models gain importance and (re-) define success factors
Digital forwarding revenues
in %
Future success factors
2030
~55%
~15%
95%
~30%<5%
2015
Semi-digital
models
Conventional
models
Fully-digital
models
• Customer Journey
• Speed and scalability
• Integration of players along the value
chain
• Short release cycles for new
applications and continuous
innovation
But also…
• Strong solution competency for
complex transport services
Source: Oliver Wyman
4© Oliver Wyman
Digitization requires developing new competencies
Next-best-offer/
Next-best-action
Digital
Payment
Dynamic
Pricing
Digital
MarketingTalent development
Agile/ cross-functional
Teams
Digital
leadership
Digital Organisation
And Governance
Big Data/
Machine learning
Modularisation/
API Development
Continuous
Integration
Agile (Software-)
Development
Digital
architecture
Data-
consolidation
Automation/
Robotics
Artificial
intelligence
Data security/
encryption
Sensor-
Technology
COMMERCIAL
TECHNOLOGY
METHODOLOGY
ORGANISATION
Examples
Source: Oliver Wyman
5© Oliver Wyman
Changing logistics competitive landscape
CARRIERS
• Direct sales via digital platforms –
vertical forward integration
• Optimization of asset-heavy core
business using digitization
E-COMMERCE
GIANTS
• Leveraging E-Commerce volumes to support
backward integration
• Digitalization of logistics
• Mix of partnership and in-house investments
START-UPS
• Focus on asset-light, data-based business
models
• Disintermediation of the logistics value chain
LOGISTICS COMPANIES
• More investments into digital business models
• Digital Transformation of the core business
DIGITAL
LOGISTICS
COMPETITION
Source: Oliver Wyman
of funding for logistics
start-ups in 2017
~$3.5B
7© Oliver Wyman
Online freight platforms
E-forwarding
Marketplaces (carrier-to-carrier) and
load matching platforms (shipper-to-carrier)1Freight
Forwarding
Manufacturing Sea and air freight1 Terminals Land transport Warehousing Last mile
3 42 5
7 8 9
Land transport
Autonomous linehaul trucking solutions
Self-driving enabling technology
Mobile solutions for drivers/fleets
Fleet management solutions
Alternative commercial vehicle tech
Warehousing
Virtual warehousing
Automation/robotics for
warehousing
Wearables supporting
warehouse services
Last-mile delivery
On-demand delivery platforms
Urban delivery
incl. station solutions
Autonomous last-mile delivery
(drones, robots)
Data flow
Supply chain visibility and steering
Transport management systems (TMS)
Supply chain tracking (incl. last mile)
Inventory management
Big data analytics
Security/transparency/risk mgmt
Product provenance (e.g., w/ blockchain)
Risk management
Asset tagging, incl. sensors
Financial services
Financial blockchain solutions
Supply chain payment platforms
Trade financing solutions
Integrated
(e-commerce)
logistics solutions
Maritime
Vessel /asset tracking
Route optimization
Ship-to-ship/ship-to-
shore communication
Initial start-up engagement
(total funding < $50M)
Emerging start-up engagement
(total funding between $50M - $200M)
Strong start-up engagement
(total funding > $200M)
Increasing start-up activity across the logistics value chain – nine main clusters of start-up activity to be distinguished
Note: Total funding by cluster extrapolated/ estimated
Source: Crunchbase, CB Insights, Oliver Wyman
8© Oliver Wyman© Oliver Wyman
Areas of funding, 2017
In %, selected large funding rounds1Start-up Lead-Invest. $MN
$110M
$25M
$20M
$13M
$12M
$62M
$25M
$25M
$30M
$300M
$1,200M
$9M
$15M
$4M
$15M
~$3.5B
12
3
4
5
6
8 9$20M
$24M
$60M
$30M
7
Online freight platforms 5%
Maritime 1%
Land transport 13%
Warehousing (incl. robotics) 13%
Last-mile delivery 53%
Integrated (e-com.) logistics 4%
Supply chain visibility & steering 6%
Security/ transparency/risk mgmt. 1%
Financial services 3%
$30M
$60M
$114M
Start-ups now engage across the entire logistics value chain and are aggressively expanding into new spaces
1. Not necessarily largest invesmtents
Source: Crunchbase, Oliver Wyman
9© Oliver Wyman
Logistics incumbents continue to compete with various types of companies for attractive start-up players
• Digitally integrating into clients’ supply
chains and production processes
• Optimizing own operations and
processes (e.g., warehouse robotics1)
• Tapping into fastest growing,
“disruptable” areas of logistics
• Identifying scalable, asset-light
business models, e.g., freight
forwarding
• Creating next generation logistics, e.g.,
in last-mile delivery (Amazon, Alibaba)
• Applying big data analytics, artificial
intelligence and machine learning in
logistics (Google, SAP, etc.)
Logistics incumbents Tech giants
VCs
• Intelligently connecting passenger and
cargo transport
• Developing autonomous driving solutions
• Defining integrated trucking
solutions/platforms
Mobility providers
Illustrative excerpt/Not exhaustive
1. Robotics includes drones, driverless technologies, augmented reality, warehouse robots
Source: Oliver Wyman
10© Oliver Wyman
A significant increase in the number of logistics start-ups has been observed since 2016 in the DACH region
Logistics start-Ups in DACH
Online freight platforms
26%
Last-mile delivery solutions
22%
Supply chain visibility and steering
17%
Warehousing incl. robotics
10%
Security and risk
management…
Other15%
2017
>40
~33%
~60
2016
Number of logistics start-ups by area of focusNumber of logistics start-ups
2016 vs. 2017
~ 60
Source: Oliver Wyman
11© Oliver Wyman
Logistics incumbents have taken on the challenge and have intensified investments into their Digital Transformation
OCEAN TRACKING & TRACING
• Providing near real-time shipment
status, allowing forecasting of freight
journey to facilitate disruption mgmt.
• Combinable with DHL Ocean Secure
for holistic product status transparency
(incl. temperature, humidity, shocks)
ROBOTICS
• Operating one of the largest fleets of
perception-controlled robots in
warehouse logistics in Europe
• Wireless transmitting of orders to
execution robots from material
management system
PLATOONING
5G NETWORKS RAIL CAR TELEMATICS
E-FORWARDING
• Deploying a “etouch” platform for
automated online, real-time quotation,
invoicing and tracking & tracing
• Designed for high volume standard
bulk
INLAND WATERWAY
FREIGHT EXCHANGE
• Establishing a digital freight
exchange for inland waterway
shipping
• Platform for additional services
such as inland waterway document
mgmt.
• Piloting 5G mobile data standard in
the port of Hamburg
• Data transmission between
infrastructure posts with up to ten
Gigabit/ second to optimize port traffic
and make it more secure
• Piloting of Platooning technology in
cooperation with MAN in spring 2018
• Preparing for fully autonomous truck
pilots within DB Schenker terminals
Focus on Central European incumbents
• Equipping VTG rail car fleet with
telematics units to introduce
geolocating, and external influence
monitoring (shock, external
temperature, etc.) to rail freight
Source: Company Information, Oliver Wyman
12© Oliver Wyman
Logistics players need to digitize their core business and develop new business models at the same time
Start-Up investments do not replace the need
for digitizing the core business
But: Start-Ups can help
a) to develop new business models
b) to accelerate the digitization of the core business
Source: Oliver Wyman