Opportunity Radar

From Logistics & Transportation 2030 at http://www.pwc.com/gx/en/transportation-logistics/tl2030/emerging-markets/for...

The radar is designed to provide a pragmatic, but creative perspective into the future. In order to provide a tool which supports decision-making, the radar presents opportunities with different degrees of innovativeness. While some of them are almost near implementation, others remain visions by current standards.


Online platform to organise logistics

The market for logistics services is currently somewhat fragmented, lacking in transparency and inefficiency in most emerging markets. Online platforms may be an option to better coordinate logistics services. In some developed countries, these platforms have already been implemented successfully. They include relevant information about logistics service providers in the market and serve as freight exchanges or tendering platforms. An online platform which integrates comprehensive information would facilitate the rapid identification of optimal providers for required services.

Social network broker

Professional social network brokers (SNB) could assist in ‘getting to know the right people’. Social networks and personal contacts will continue to be crucial in doing business successfully in the future. Foreign companies which aim to enter an emerging market could contact SNBs and share their ideas on future business plans in the respective emerging countries. In turn, SNBs will arrange and initiate the first contact between the new market entrants and relevant individuals in the emerging country.

Consolidation scout

Consolidation scouts could develop an attractive business opportunity in emerging countries. They could use their experience and knowledge about the logistics markets in specific emerging countries and assist in identifying potential acquisition targets for companies aiming at growth through mergers and acquisitions. Consolidation scouts would check not only financial situations and product portfolios, but would also assess cultural fit, distribution networks, and strategies in order to spot optimal acquisition targets. Consolidation scouts might also serve as advocates for the deal, once they have identified a suitable M&A partner.

4PL 2.0

Fourth-party logistics service providers (4PL) coordinate and manage delivery or supply networks to achieve efficient, agile networks and support other service providers. Such companies could play an important role in emerging markets, where they could help to increase currently low levels of efficiency. 4PL 2.0 would provide a facilitating role in fragmented markets, as they offer a service portfolio based on the combination of logistics services provided by sub-contracted logistics service providers. 4PL 2.0 would incorporate even the smallest logistics service providers and their service offerings within an emerging market into their networks, providing small logistics service providers with jobs which they might not have received without the 4PL’s support and activity in the logistics market. Companies benefit from 4PLs’ extensive networks and experience, which will help them select for the best logistics service solution for each individual customer.

Collaboration of logistics service providers to shape new transport corridors

The design and shape of new trade corridors will be strongly affected by the new players actively using them. Logistics service providers should work closely together in order to shape those new transport corridors, i.e. identify future transport corridors, seek ways to build up required infrastructures, actively contribute to their establishment and develop services which are optimised for transportation activities taking place in those corridors.

Logistics scouts

Logistics scouts could aim to identify logistics experts in developed countries. Working on behalf of logistics companies in emerging countries, they could aim to secure qualified logisticians and supply chain experts willing to relocate to emerging markets. Logistics scouts would serve to help to close the talent gap in some emerging markets.

Establishment of research cultures

The importance of logistics research and research oriented cultures in emerging countries is still lower than in many developed countries. Nevertheless, as research is a driver for sustainable development and innovation, ways to promote research in emerging markets will need to be found. Logistics companies in emerging countries should aim to increase research activities in their markets by establishing concrete incentive systems. For example, logistics companies in emerging countries could collectively announce attractive research prizes or reward best practices in the logistics industry.

Managerial accounting and performance measurement

Many logistics processes in emerging countries are rather inefficient today. In many emerging countries, logistics costs represent a much higher proportion of overall GDP than in developed nations. Advanced managerial accounting and performance measurement processes could assist in better understanding cost drivers in logistics processes and becoming more efficient.

Logistics honey bee network

The original honey bee network is an organisation founded in India made up of like-minded individuals, innovators, farmers, scholars, academicians, policy makers, entrepreneurs and non-governmental organisations (NGOs). It functions on the premise that members exchange knowledge and innovative ideas in a fair and just way. The goal thereby is to establish a sustainable knowledge sharing organisation in which each member benefits from other members’ ideas and skills. In the past, numerous innovations have been realised within the network which are used by a large number of network members today. Similar networks could be established for logistics industries in emerging markets. Within these networks, logistics service providers could share innovative ideas, best practices and knowledge in order to improve their logistics industries.

Mobile tracking and tracing

The usage of mobile phones is well-established in certain emerging markets, with coverage rates in some cases exceeding those of developed markets. This trend is likely to continue and could support new areas of application, such as the use of mobile phones as simple tracking and tracing devices. For example, truck drivers could be localised via their mobile phones which would give information about the location of the transported goods and products. Using established and widely-used technologies such as mobile phones would lessen the requirement to install cost-intensive tracking and tracing systems.

CSR guard

Many companies are increasingly aiming to operate in a responsible way and are highlighting their CSR [Corporate Social Responsibility] activities, often as part of a strategy to protect and build valuable brands. Achieving real sustainability usually means monitoring the activities of supply chain partners as well, however many companies report challenges around monitoring the extent to which supply chain partners are also complying with CSR guidelines. This difficulty is especially acute when suppliers are located in other regions. Many LSPs already have a core competency in connecting companies across the supply chain. They may be able to leverage valuable knowledge about partners’ activities and develop service offerings which would monitor whether supply chain partners stick to CSR related agreements.