Redspher

1. What are some of the major challenges and trends that have been impacting the Logistics industry lately?

The post covid global economy recovery is facing significant headwinds.

The first one, is the supply chain disruption started by the pandemic and the various successive crises (e.g. semiconductor shortage, local Covid restriction like in China, war in Ukraine and its consequences,). The volatility of transport demand is no longer temporary but here to stay.

The second one, is the persistent labor market challenges. The transport capacity is restricted due to driver shortage, supply disruptions and entrepreneur confidence.

The third one is the entry into force of the EU Mobility Package which has led to an increase in the shortage of carriers especially for the express delivery market. We are just starting to see the long term effect in which carriers have decided to stop or to only operate within domestic borders.

Not least of all are the rising inflation and peaking energy prices. It might soon become unbearable for a part of the industry including carriers due to maintenance costs increase, fuel prices and driver salaries.

2. What keeps you up at night when it comes to some of the major predicaments in the Logistics industry?

If we look at the cost of a transport in a simplified way, it can be broken down into three main elements i) the fuel, whose price has increased by more than 20% since the beginning of the year ii) the vehicle, of which the price has also increased between +25% to +40% depending on the country and the type of vehicle iii) the driver’s salary where the ecosystem will have to find ways to increase the driver’s salary and the attractiveness of the profession. Otherwise it will not solve the driver shortage and will then heavily impact the capacity and the prices.

“ The introduction of the Logistics 4.0 which will optimize the end to end supply chain and change the industry towards a more sustainable and resilient future.”

When we look at these three variables, we arrive at a global cost increase of a transport of about 30%. The question is how this increase will be spread between shippers, forwarders, carriers and drivers. But for sure, as it is now, the market cannot keep fixed prices with a guaranteed solution.

As most probably the shippers will not take 100% of this increase, the entire ecosystem will have to restructure in the mid-long term. Small forwarders who do not add any particular value for the shippers will see their activity decrease.

3. Can you tell us about the latest project that you have been working on and what are some of the technological and process elements that you leveraged to make the project successful?

At Redspher, we are convinced the accumulation of current events will change business models, particularly in the time-sensitive freight market. And in this context we started a transition to become a digital platform which facilitates transactions between shippers and carriers. Technology replacing the non-value added actions of a forwarder. We are dedicated to offer our shippers an easy way to find, book and track each shipment for their unexpected transport needs. On the other hand, we offer services to our carriers to easily find shipments and reduce empty mileage.

4. Which are some of the technological trends which excite you for the future of the Logistics industry?

The introduction of the Logistics 4.0 which will optimize the end to end supply chain and change the industry towards a more sustainable and resilient future. For the near future I expect a transition from thermal engine to electric or hydrogen. In addition the arrival of autonomous vehicles which can bring key advantages to the logistics industry.