Friday 3rd December 2021

How investment in IoT is helping telematics and logistics companies

Published on February 4th, 2021

Streamlined processes, cost efficiency, timely and accurate data collection; the benefits to be had from technology solutions are many. In regions such as Asia Pacific, North America and Western Europe, increasing numbers of companies are incorporating IoT into their business models as they look to take advantage of the latest developments offered by digitisation, but what is the story in emerging economies? reports by David Boxshall, head of international expansion at Pod Group.

Pod Group, a provider in advanced IoT connectivity for the enterprise, interviewed several companies operating in the telematics and logistics industry in Africa to find out how investment in long-term IoT solutions is helping companies in emerging markets.

Emerging economies are fragile

In the current climate, whereby prices and overheads are increasing exponentially, largely as a result of the COVID-19 pandemic, companies in Africa are looking to cut expenses where possible in an attempt to combat rising costs and stay afloat. However, while reducing headcounts might see direct costs fall, generating revenue often remains a challenge.

A panoramic shot a road in the Atlas mountains in Morocco

A cohesive transport network is essential for successful supply chains. The occurrence of natural disasters and restrictions at borders are just two examples of situations in which transport corridors might be closed, either partially or completely, impacting negatively on logistics and the supply chain in the African region.

For some logistics companies, the closure of transport corridors can see demand for their services drop off, meaning that not only are they unable to retain current customers, but the process of attracting and capturing new business also becomes increasingly difficult.

For others, finding alternative routes ensures that they are able to continue business activity; however, without the right systems and processes in place, these logistics companies run the risk of not adapting to new situations successfully. Integrating technology solutions, such as fleet data analytics, helps limit the disruption by enabling businesses to forecast with greater accuracy.

Digital analytics tools provide detailed overviews of transport legs along selected routes, giving companies the means to calculate vehicle fuel consumption, as well as the cost per kilometre or per tonne, leaving little margin for human error.

Other transport corridors

Exploring alternative transport corridors is not the only solution for logistics companies looking to generate revenue. Changing customer demand also paves the way for new business opportunities, and it is those companies utilising online systems and platforms, as opposed to manual processes, which are best prepared to take advantage of openings in the market.

For example, following the enforcement of new COVID-19 restrictions that saw public transport services reduced to just 25% of their normal capacity, a provider of fleet management solutions in East Africa adapted its business offering to provide enterprises with an integrated booking system to reserve private cars for their customers and staff remotely.

Big freight truck with flat bed going down the winding mountain road

The prior incorporation of technology solutions into the business model meant that this company was able to adapt faster to the evolving market conditions, and their ability to create a new revenue stream has made them more competitive both in the short and long term.

While the fragile economic climate may not always favour investment in technology solutions due to the often high initial costs, those companies that have incorporated digital tools into their business models recognise the benefits that such investment can bring. From providing data which allows for accurate forecasting and optimised resource allocation to enabling them to quickly develop value-added services and fill new gaps in the market, long-term IoT solutions place companies on the front foot.

Digitisation ensures that businesses are better placed to create new revenue streams which, in turn, helps them remain competitive in adverse market conditions.

The author is David Boxshall, head of international expansion at Pod Group.

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