Overview of the Top 5 Challenges Facing the Logistics Industry

2 Mins read
  • There are multiple challenges facing the logistics industry, which need to be overcome if you want to be successful.

Any industry needs to be competitive in order to survive. It’s the balance between pricing low enough that customers can afford the goods and high enough to generate a profit.

Of course, the global pandemic has created a huge strain on many industries, including the Logistics one. Logistic companies are now facing 5 key challenges and these have to be overcome if they want to continue in business.

1. Damaged Goods

One of the biggest issues facing logistic companies is items being damaged during transit. Australian Post is known to lose 14% of parcels, that’s enough to persuade most people to use a different service.

But your service will quickly be undesirable if you deliver damaged items. Training your staff can help but you’ll also find it beneficial to use data loggers. There are several types available, including those that monitor temperature, drops, and impacts. This provides the sender with confidence and places the emphasis on the logistics company to look after the parcel. It’s a simple, but effective way to reduce the number of damaged parcels.

2. Rising Costs

The cost of fuel is rising as this precious liquid becomes more scarce. Although the pandemic caused the price to drop, this was a temporary reprieve. Logistic companies are having to deal with rising running costs without being able to increase the price of their services. This is particularly important if you are personally struggling with debt.

Alongside this, wages are likely to move upward, as will many of the other overheads that are needed to run a logistics company.

3. Regulations

Government regulations are slowly tightening. Specifically, they are targeting emissions. That’s something that is directly relevant to logistic companies as they rely on their trucks to move the parcels around.

Companies need to reduce their emissions which means they’re going to need to rely more on computers. These will be able to work out the most cost-effective and low emission options to move all the necessary parcels from one point to another.

4. Internal Processes

Many logistic companies operate with simplistic systems that date back t when they started. However, society has advanced at an impressive rate, digital technology is taking over. Logistic companies need to embrace digital technology in order to maximize their efficiency and to ensure that customers can accurately track orders.

While this is a good investment, it is also an expensive one. Companies are going to need to invest in the technology and it’s not easy to get the funding during and straight after a pandemic.

5. Qualified Drivers

It may be surprising but truck driver is considered an older person’s industry. This is because there are surprisingly few young people training to drive trucks. In part this is due to the fact there are so many opportunities available today and truck driving is a relatively lonely career choice. You need to make sure that the right drivers are hired.

Of course, this creates an issue for logistic companies as they need a steady flow of drivers to ensure their company runs smoothly and efficiently.

It should be noted that this is not all the issues facing the logistic industry, just the biggest challenges.

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About author
Kayla Matthews is a journalist and writer covering topics related to BizTech, big data, AI, workflow automation and professional development. To read more from Kayla, please follow her on Twitter or check out her personal blog at
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