6 Ways to Use Artificial Intelligence (AI) in Logistics

How do you use AI in logistics? There are several key areas that can be improved with the use of artificial intelligence, especially when data analytics are concerned. From predicting peaks and determining the optimal stock levels for the given period to optimising routing and automating warehousing—all of these are possible with AI. Do you want to learn more? Then keep reading!

AI for Logistics: Key Use Cases

To begin with, let us proceed with examples of how AI can improve your logistics operations. What are the most common and powerful applications of this technology?

Forecasting

It’s impossible to predict everything when logistics are concerned, but the more you know, the better prepared you can be. And how can you learn more? By using AI for data analysis.

AI models powered by machine learning can use historical data to discover patterns indicating certain situations, such as sales peaks. When using such models, all you have to do is set alerts for certain occurrences and wait—whenever a particular pattern is recognised, you will be informed. Hence, you will have the opportunity to prepare your store for the upcoming logistics challenges. This particular application is so powerful that it has become one of the main reasons why the use of AI has grown to be one of the most important e-commerce trends.

Intelligent Warehouse Management

Warehouses are the backbone of your supply chain. The better they are managed, the more products you can store, the faster you fulfil your deliveries, and the better your business works. Thus, it is crucial to streamline your warehouse management, and AI enables you to do that.

As already hinted, AI can help you compare your current stock levels with the demand and, in turn, alert you if you need restocking. It may be used to plan your space utilisation and optimise routing in your warehouse or even assign tasks to your workers. As such, using AI in this particular area of logistics leads directly to streamlining your warehouse operations and maximising efficiency.

Route optimisation

Another key use of AI in logistics is route optimisation. Simple as it may seem (after all, you could try to do that even with a simple GPS), artificial intelligence can use its predictive analytics features to choose the best route for each delivery in advance, hence reducing the overall delivery time and ensuring that your parcels are never delayed.

Intelligent Automation x Data Integration

You may also use AI for a less obvious purpose in logistics: data integration. Your supply chain operates on various systems, and you need them to exchange data swiftly, in real-time, to achieve the best results…but it’s often difficult. Setting up data integration manually requires time and IT expertise, so it is extremely costly. However, AI can help make it less expensive and quicker.

There are many intelligent automation and data integration tools available on the market, so all you need to do is pick one that will merge all your valuable data into a single source of truth. This way, you won’t have to worry about selecting the right software or about the native integration capabilities of your IT solutions—you’ll be able to use whatever suits your business the most and provides the biggest value.

Smart Pricing

Many businesses, especially e-commerce stores, use smart pricing nowadays—it’s a way to incorporate AI into your business and achieve higher income. However, can you translate this function into logistics and actually turn it into an advantage? Yes!

You may use an AI system to calculate real-time prices of your last-mile carriers and define which of them is the least expensive for a given delivery. This way, you can achieve major savings, hence improving the profitability of your whole business.

Customer Service

Whether we like it or not, customer service is a crucial part of logistics, no matter what role you play in the supply chain. With AI-powered chatbots, you can improve the productivity of your customer service teams, process more queries and offer 24/7 customer support (at least for the less complex queries). This enables you to improve customer experience and provide your customers with immediate feedback if they have any concerns about their deliveries.

AI in Logistics - The Takeaway

AI is a powerful technology, whether for logistics or any other industry. Therefore, you should consider incorporating it into your processes. Remember, AI is versatile—there are many more uses for it than we listed in this article, so don’t hesitate to experiment with it and find the best way to optimise your business using artificial intelligence.

You may also read: Deliver Amsterdam 2024: Post-Event Summary, Learnings