Pandemic Drives Demand For Technology In Logistics
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With the current pandemic crisis we are dealing with there is always new information coming out about what to do and what not to do, or what is changing around the world. A logistics tech vendor company, Project44, has said they are seeing a huge jump for its supply chain visibility software. This is coming despite restrictions and recessions of the COVID-19 pandemic. They were quoted on June 30, 2020, as saying that they had raised a $51 million round of investment funding despite the pandemic. This comes after previous funding events in 2018 and 2019. They have raised a total of $140.5 million to date and are planning on investing in product innovation, rapid scalability of network, and global expansion. This new backing comes as they saw a “record-setting” first half of 2020 with a 139% increase in bookings over last year’s same time period. They believe that increase is due to significant growth from global retailers, manufacturers, and distributors around the globe.
The company has a platform that provides advanced visibility for shippers and LSP’s (Logistic Service Providers) through a network of connections to telematics and ELD’s (electronic logging devices). These devices are used by truckload and LTL carriers, as well as rail, ocean, and air freight.
There is another logistics tech firm that is seeing a jump in their demand as well. Flock Freight, whose software combines a number of small shipments that normally are LTL’s and “carpools” to create full truckload cargo. They were backed in February by a $50 million venture capital round, with Google Inc. as one of the investors. They have seen “massive expansion’ of users since the pandemic started due to shippers rushing to deliver essential goods. Oren Zaslansky, Flock Freight CEO, believes “The crisis itself is a ‘forcing function’ and its forcing change, which is something a lot of companies, knew they had to do anyway.” Some drivers are choosing to stay home to avoid traveling to regions high in COVID-19 infection rates, which is making trucking fleets feel the pinch from the pandemic. The drivers that keep working are seeing freight rates crash and wait times at warehouses jump from minutes to hours according to Zaslansky.
According to a research study from enterprise software vendor IFS, “70% of businesses plan to increase or maintain their digital transformation spending amid the pandemic.” That includes 52% that plan to increase spending. During these times increasing spending on digital transformation follow close with the myriad of concerns that are coming with economic conditions, according to IFS. Actually, the survey shows that people concerned about the economic condition were actually more likely to increase spending on digital transformation.
“The study confirms that many companies are wisely using the global downturn to divert resources to technological renewal and innovation,” Antony Bourne, IFS Industries’ Senior Vice President. There is reason to believe that companies who are more so progressive toward technology investments will be ready and equipped to come out of this. The majority of businesses are doing what they can to adapt to the economic upswing and not permanently getting rid of their digital transformation plans.