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Why More Manufacturers Need Logistics in 2020

Posted by IndustrySelect on Thursday, February 20, 2020

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3 MIN. READ

Taken at face value, manufacturing is a simple process. A manufacturer receives raw materials, transforms them into a product and ships that product to a recipient.

Of course, the reality of manufacturing is more complicated in 2020 than ever before.

From revolutionary technologies such as AI, machine learning, 5G and automation to the outsourcing of production processes such as shipping and handling, manufacturing today is incredibly complex.

For that reason, logistics services and experts who can synthesize these processes smoothly play a crucial role in modern manufacturing. As IndustrySelect helps logistics companies and freight brokers fnd new leads in the manufacturing world, we wondered: what's the outlook in 2020 for logistics companies looking to do business with manufacturers?

Today, we'll be examining some of the most notable trends affecting manufacturing and why manufacturers need logistics now more than ever before.

Outsourcing Has Fundamentally Changed the Logistics of Manufacturing

The days of manufacturers handling every part of the process from material reception to product delivery are long gone. Many manufacturers operate a large number of sites, either nationally or internationally. Additionally, outsourcing the packaging and the shipping process is now cheaper for most manufacturers than handling it in-house.

These changes have completely transformed how products get from a manufacturer to a client or customer. Now, large manufacturers have to worry about negotiating with shipping and handling vendors in addition to managing a vast network of plants across the nation or around the world.

Logistics experts present a solution to this challenge. Logistics services and specialists can help manufacturers streamline outsourced processes.

Bringing on logistics experts to optimize outsourced processes and internal communications can also help manufacturers to expand their outreach.

Manufacturers that once would have been land-locked can use outsourcing to ship products around the globe, reaching key markets that were once inaccessible.

As manufacturers continue to outsource more processes and expand services, logistics will only become more critical.

Logistics Plays a Crucial Role in Helping Manufacturers Navigate Burgeoning Technologies

Manufacturing, particularly in the U.S., has felt a lot of stress recently. U.S. manufacturers have suffered in recent years from a lack of talent (there are 500,000 unfilled manufacturing jobs) and the fallout of aggressive trade policies by President Donald Trump's administration.

However, manufacturing in the U.S. is starting to bounce back. New technologies like Auto-CAD, machine learning, AI, automation, big data and 5G play a significant role in that resurgence.

These technologies allow manufacturers to expedite both processes and outcomes drastically. For example, AI and CAD software can assist QA engineers by allowing much of the QA process to take place digitally.

5G technology enables manufacturers to expedite internal and external communications. Automation and machine learning help manufacturers address a lack of talent by requiring fewer contributors to production processes.

The list goes on; the long and short of it is, these cutting-edge technologies help manufacturers break through many of the barriers they currently face.

However, integrating these technologies into the infrastructure of a manufacturer is no easy task.

Employees from engineers to production floor workers have to understand how their responsibilities will change with the incorporation of new technologies. Additionally, manufacturers must use multiple technologies from different vendors together fluidly to get the most out of these tools.

Logistics specialists play a crucial role in these processes. They can help manufacturers establish education opportunities for employees to familiarize themselves with new technologies.

They can also assist manufacturers with the vendors and technologies they use, reducing friction between different resources.

The U.S. manufacturing market has weathered the storm in recent years, but it isn't out of the woods yet.

predicted global recession could hit manufacturers hard, and questions remain concerning how President Trump's policies and a new presidential election will affect the market going forward.

For manufacturers to see continued success through 2020 and leading into 2021, logistics will need to play a major role in the manufacturing market as a whole.

Are you a logistics, freight or transportation provider? An IndustrySelect subscription can help you find new business in the industrial world. Subscribers can get up to 30 data points to help them identify and pre-qualify the best leads from 500,000 industrial business that need logistics like yours. Profiles also include the names, titles, and email addresses for hard-to-reach executive decision-makers. To learn more about what IndustrySelect can do for you, visit our website and start your free demo.

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