2023 Logistics Trends — Technology, Sustainability, and New Delivery Formats

In 2023, logistics and supply chains will continue to face countless and unpredictable challenges such as economic conditions, weather, geopolitical issues, and more, according to *Global Trade Magazine*.

As companies prepare for what awaits them in 2023, here’s what carriers and shippers need to know and how to get ready:

Digitalization and Data

The role of paper-based documentation will continue to decline, giving way to digital solutions. This trend will persist into 2023. Digitalization enables companies to gain valuable insights and accelerate smart decision-making. Data analytics and intelligence provide better visibility for customers, which remains one of the biggest challenges for shippers today.

TYPES OF CUSTOMS DUTIES AND FEES

When a shipper works with multiple suppliers, it’s difficult to stay updated on shipment statuses without contacting various suppliers and simultaneously gathering legal documentation for transportation. This not only reduces time and operational efficiency but also increases the risk of errors.

Reshoring and Nearshoring for Manufacturers

Reshoring and nearshoring have increased over the past decade, largely due to tensions between the US and China, a significant rise in shipping costs from China, the pandemic’s impact on global supply chains, and sustainability concerns. According to a Thomas Survey in April 2020, 64% of surveyed North American manufacturers said they were likely to bring production back to the US. These circumstances have forced manufacturers to refine their strategies, with a similar trend observed in Europe. Shippers needing to quickly transport goods from China are compelled to pay for expensive air freight, while ocean shipping takes 20 to 30 days.

Rising Diesel Fuel Prices

From January to June 2022, diesel fuel prices surged sharply in both the US and the EU. The primary reasons were the Russia-Ukraine war and the introduction of the international IMO 2020 rule, which took effect at the beginning of the year. Geopolitical issues stemming from the Ukraine-Russia conflict have caused a significant gap between global trade supply and demand, and rising fuel prices are likely to slow global GDP growth. The IMO 2020 rule mandates that bunker fuel used by ships must have a sulfur content of no more than 0.5%, further impacting diesel prices. With so many factors affecting diesel prices and market instability, companies transporting goods will need to find ways to adapt to these ongoing cost increases in 2023.

### Green Shipping and Environmental Regulations
The global freight industry already adheres to minimum fuel efficiency standards and maximum emission limits for gasoline and diesel vehicles. Stricter environmental regulations and consumer pressure to reduce pollution and greenhouse gas emissions are pushing logistics stakeholders to reconfigure operations and innovate, fostering sustainable infrastructure and electric fleets. Optimizing logistics and moving goods at a reasonable cost with minimal environmental impact can enhance efficiency and reduce carbon emissions.

Automation

Technology and automation in logistics operations have become critical for addressing industry pain points and managing shipments with lower costs and on time. According to the McKinsey Global Institute, the transportation and warehousing sector has the third-highest automation potential of any industry. Artificial intelligence, machine learning, computer vision, IoT-connected networks, and blockchain can all be applied to streamline logistics operations, making them more efficient and optimizing resources. Thus, the development of automation is expected to continue in 2023.

WHAT ARE DDP DELIVERY TERMS?

As 2022 draws to a close and we look ahead, it’s clear that the new year will continue to present challenges; however, it’s also a time of opportunity for supply chains and logistics as businesses shift from reactive to proactive and from survival mode to growth mode. Technologies set to dominate include artificial intelligence, digitalization, automation, and cloud solutions. We will also witness the introduction of more advanced technologies in this sector as companies increasingly adopt drones and robots. For manufacturers, reshoring and nearshoring will remain top priorities, while geopolitics will continue to influence supply chains. The key takeaway heading into the new year is the importance of shifting traditional thinking to develop robust supply chain and logistics strategies that align with the current landscape, as key players adapt to endless industry changes.