Connected Logistics Market Size

Connected Logistics Market Size

Connected Logistics Market size was valued at USD 33.7 billion in 2023 and is anticipated to grow at a CAGR of over 10% between 2024 and 2032. The increasing use of Internet of Things (IoT) technology is a major driver of the market. IoT equipment, including sensors and GPS trackers, allow for real-time monitoring of the location, condition, & status of commodities along the supply chain. For instance, in October 2023, Overhaul, a software-based supply chain visibility, risk, compliance, and insurance solution for the world's leading brands introduced Shipment Connect, an application that offers customers unmatched visibility into logistics processes.

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The growth of e-commerce and the globalization of trade has increased the complexity of logistics operations, which necessitates the use of innovative technologies for effective management. There is an increasing desire for faster & more reliable product deliveries, putting pressure on organizations to improve its supply chain management procedures. Advanced analytics and AI-powered solutions are becoming increasingly important, as they offer essential insights into demand patterns, forecast potential disruptions, and optimize inventory management.
 

The growing demand for operational efficiency and cost reduction is another key driver of the connected logistics market. Companies face constant pressure to optimize their supply chain systems to remain competitive. AI, Machine Learning (ML), and advanced analytics are used in logistics operations to forecast demand, enhance inventory management, and optimize transport routes. This technological integration contributes to lower operational costs, faster delivery times, and higher overall productivity, ensuring data integrity and streamlining supply chain procedures.
 

Many businesses still use outdated software and infrastructure for its logistics operations, which may not be compatible with the new IoT, AI, or cloud-based solutions. This compatibility gap restricts the widespread adoption of connected logistics technologies, necessitating significant modification, data migration, and, in some cases, complete restructuring. Being inherently time-intensive, these connections can defer the realization of benefits such as improved visibility, efficiency gains, and cost savings, posing a barrier to connected logistics market expansion.
 

The large volume of data generated by these technologies, including real-time shipment data, customer information, and operational insights, creates substantial security and privacy threats unless it is appropriately protected. Concerns about data breaches, cyber-attacks, and unauthorized access can hinder firms from implementing linked logistics systems. Additionally, compliance with data protection legislation, such as General Data Protection Regulation (GDPR) and California Consumer Privacy Act (CCPA) complicates data security management in a global setting.