The past year saw major shake-ups in the logistics industry. Industry notables faltered, with less-than-truckload shipping standard Yellow Corp. announcing bankruptcy and digital freight brokerage startup Convoy shutting down. There was an unprecedented freight slowdown, and consumer sentiment about economic conditions across the U.S. continued to trend negatively. 

That said, in recent months, the U.S. Treasury has reported considerable progress in reducing inflation. The New York Fed indicates that the probability of a recession occurring in the next 12 months has decreased from 66% in August to 56% as of November, and may continue to fall. According to Allied Market Research, the logistics market is projected to grow at a compound annual growth rate (CAGR) of 5.6% between now and 2032. 

Nonetheless, industry consolidation will continue this year as a proving ground for companies’ tech. Digital commerce’s share of the retail market will continue to climb, and the promise of autonomous trucking will likely be fulfilled over the coming year, along with other technological advances that will benefit both consumers and shippers. Two thousand twenty-four will be the year our industry begins to realize the promises of modernity.

A Shifting Economy

In 2024, more furniture manufacturers, retailers and transportation companies are likely to fold. This consolidation may reveal unanticipated ways forward — for example, freight brokerages have grown from a minor industry to one that makes up more than 20% of all trucking freight. At the same time, however, Convoy’s failure demonstrates that not all companies in an expanding sector will necessarily find success, and that cost controls matter. The events of 2023 highlight how unsustainable some of the logistics industry’s longest-standing bad habits, such as hesitance to adopt new technology and failure to manage and adapt to shifting market conditions, have become. In 2024, logistics companies will need to adopt technology that optimizes routes, warehouse operations and other facets of logistics. Retailers and manufacturers will in turn need to seek out those providers that embrace modern approaches. As we saw with the closure of Yellow, every dollar counts, and embracing innovation is critical to enabling revenue and cost savings. Technologically advanced companies will take share from less modern companies, driving consolidation.

Digital commerce’s share of the retail market will continue to increase through at least 2027, according to Insider Intelligence. Whether or not consumers spend more, a greater proportion of their spending is sure to take place online, especially as the digital natives of Gen Z increasingly come of age and enter their household-formation years. Of course, this has been true for a long while; the pandemic years only cemented it. This year, the technological innovations necessary to facilitate e-commerce’s growing share will catch up.

Evolving Technology 

This year, logistics companies will finally embrace dynamic scheduling. This tool allows customers to schedule their deliveries at the time of checkout, instead of waiting days or weeks until their order arrives at a local hub to do so.

Dynamic scheduling requires knowledge of when a product will arrive at the final mile hub, and exactly how long its journey from the hub to the customer will take, based on which routes a logistics company uses and when they run them. Many carriers avoid sharing this information, because they don’t want to be locked into a specific schedule, instead preferring to run trucks where and when they need to. However, my customers routinely report that consumers are significantly less likely to cancel an order once the delivery date has been scheduled.

Dynamic scheduling, therefore, becomes a critically important tool for reducing cancellations. By committing to a predictable schedule, carriers can fill out routes with more deliveries. This will be a differentiating technology for the industry in the years ahead.

This will also be the year that autonomous trucking moves from the realm of the experimental to an actual part of the cross-country supply chain. Although the federal government has yet to approve autonomous trucking for interstate travel, many states approved it for intrastate work. Ultimately, this shift will revolutionize long-haul trucking for both shippers and trucking companies. While it’s challenging for autonomous vehicles to operate safely in populous environments like cities and towns, they are perfectly suited to long stretches of cross-country roads. With autonomous technology, human drivers can handle the parts of a route that require increased vigilance and finesse before handing off the shipment to automation for less populated legs of the journey —and more truckers can sleep in their own beds each night. 

Spending More Where It Counts

The need for modern logistics technology becomes harder to ignore each year, even for the most old-fashioned organizations. At the same time, some logistics companies that bet it all on the promise of new or trendy tech were disappointed by a lack of return on investment, with nearly three in five companies regretting software purchases made in the last 12 to 18 months. That’s why I expect logistics companies to be more strategic about their spending in 2024.

Like other sectors, the supply chain industry is subject to fads and buzz that can skew more level-headed evaluations of which solutions are right for which companies. While one particular brand of running shoes might have the splashiest ad campaigns, that doesn’t mean it will work for both the casual jogger and the marathon runner. Similarly, there’s no one-size-fits-all solution when it comes to logistics. 

I’m hopeful that this year, companies will finally take this understanding to heart. In 2024, organizations will direct extra focus to figuring out which platforms and technologies are right for them. Rather than requiring a total overhaul, the best solutions give companies the functionality and support to do what they’re already doing with greater ease and efficiency.

By keeping in mind what this year is likely to hold, and implementing effective and flexible technology solutions, those in the supply chain sector can draw on their knowledge to see a successful 2024.

Doug Ladden is co-founder and chief executive officer of Deliveright.