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Supply chain constraints and logistics efficiency emerged at the forefront of conversations a few years ago, following the pandemic and its aftermath. Suddenly, the items we desired were either out of stock, or e-commerce deliveries were delayed or expensive. Geopolitical tensions, high energy prices, and the growing use of technology are expected to reshape the supply chain operations and logistics landscape this year. These pressures have contributed to a spike in logistics costs over the years – costs have risen by around 5 percentage points since 2010 – and is expected to rise even further with the ongoing scarcity of warehouse space, labor shortages, higher final-mile costs and customer demands for faster delivery speeds. Another recent development is the reduction in container shipping costs, which coincides with a fall in consumer demand as inflation takes its toll. So how can third-party logistics companies remain competitive in this increasingly challenging environment?

For decades, the logistics industry has generated a vast amount of data, but has only been able to unlock value from a fraction of it. But today’s 3PL companies have the opportunity to tap into analytics solutions to harvest and contextualize these data points to make better decisions. Now more and more 3PL companies are adapting to these new realities. A recent study found that over 43% of 3PLs intend to increase investments in data analytics solutions to run a tighter, more resilient operation, improve customer experience and reduce operational costs. This blog will explore common challenges faced by 3PL companies and how 3PL companies are leveraging data analytics solutions that will empower your team to proactively prevent disruptions, boost visibility and improve operations.

Data analytics to deal with challenges and benefits for you

  • Holistic data visualization for decision making

One of the biggest challenges a 3PL company faces is converting the massive volume of data generated by multiple sources into valuable insights. There is customer order data from physical stores and e-commerce platforms, warehouse and supply chain operations, shipping and transportation fleet details, fuel prices, GPS data, weather forecasts, traffic updates, and information about ports and customs to contend with. A data analytics solution will provide you with a mechanism to integrate all this data into one analytics platform – which you can then use in several ways. The solution will enable you to perform different types of data analysis via a centralized dashboard. You will have the capability to perform self-service analysis to help you understand trends and patterns. This solution can also function as a starting point for predictive analytics which we will explore further in this blog.

  • Predictive analytics for risk management

To thrive in our new rapidly evolving normal, any organization must have the capability to respond fast. A holistic view of data gives you the information that you need to understand trends, bottlenecks, and weak points, and plan around any possible disruptions or emergencies. For example, you can keep track of delivery costs amid fluctuating energy prices, estimated delivery timelines from the time the goods leave warehouses until they reach customers, transport between factories and warehouses, issues in your transport fleet, if any maintenance is required, and adverse weather or traffic conditions that require any delivery route alterations. Since you also have access to historical data, you have a better view of trends that have developed over time and how disruptions are likely to affect your business operations. Predictive analytics enables you to anticipate and manage your risks in a more informed manner – especially helpful in today’s economic climate.

  • Improved customer services

Customers are cognizant of supply chain issues and understand that they may face delivery delays at times. The ability to work around constant changes and constraints, while maintaining service standards, is what will make you stand out. A data analytics solution gives you the visibility that you need to proactively improve communications with customers and delivery partners, and between 3PL companies and warehouses regarding supply chain issues and any delivery delays. You are then more prepared to update your customers on anticipated delivery times, the most accurate delivery costs, and in the case of emergencies that you have no control over, you can inform your customers about any changes to the delivery timeline. You can also ensure that you preserve the quality of any fragile and/or perishable goods through improved data visibility. Building stakeholder faith in your company will become your foundation for customer retention and business success.

  • Incorporating technological advancements to further refine operations

As with any other industry, the logistics industry is increasingly using artificial intelligence (AI) and machine learning (ML) in its business operations. AI and ML applications are particularly useful for supply chain management. Companies can use ML for forecasting, and planning – which in turn improves warehouse operations and leads to cost savings. More accurate forecasting and better planning means that you can reduce over-ordering items. Customer service is also being transformed through the use of chatbots to answer queries instantly and provide real-time updates. Route optimization also gains from the use of AI and ML – the real-time data generated helps companies plan the shortest and most cost-effective transportation routes. Global operations involve the difficulties of handling data in multiple languages. You can use ML in these instances to interpret the data and incorporate them into your operational systems which in turn will improve their efficiency.

How 3PL companies are using data analytics solutions

  • Leading North American logistics company taps into data analytics to power its decision-making

One of the fastest growing logistics companies in North America lacked a data analytics solution to provide them with a holistic view of data. The data analysis process was time consuming, and the data was not ready for analysis. The company did not have centrally consolidated data and KPIs and was unable to gain the full benefits of having more data visibility such as creating reports for different types of data analysis and predictive analysis.

Once they implemented a data analytics solution, they could view their data on dashboards to aid decision making. The data analysis process is faster as the team now spends 60-70% less time standardizing the data and has access to customized reports that enable them to understand trends. The company is now looking at cost savings in the long term as they can identify operational inefficiencies and even perform predictive analysis.

  • Asian 3PL company turns to data to transform operations

One of the largest and most reliable freight forwarding and logistics companies in Asia used a data analytics solution to further their digitalization drive and prepare themselves for Industry 4.0.

The data analytics solution integrated data from multiple sources (CRM, labor management, finance) into a dashboard to provide them with better data visualization. The company now collects data to support both managers and clients. As data is consolidated and readily available, the leadership team can make decisions faster. Furthermore, this company is now more confident about staying abreast of innovations and responding to changing market conditions.


The benefits of data analytics in logistics are clear. 3PL and logistics companies that we talk to have common needs – data visualization via dashboards, data integration from multiple sources, more knowledge of using AI and ML in their solutions, gaining real-time insights about their operations, and cost savings. They also have challenges that are unique to their companies and are looking for the best way to adopt data analytics solutions to address each of these. Intellint provides data analytics solutions using the strengths of Microsoft Power BI and Microsoft Azure platform and underpinned by our deep understanding of industry needs and trends. We are always keen to hear from 3PL companies and explore ways to take the conversation forward. Talk to us today.


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