The Internet of Things is everywhere. Retailers market to consumers according to their personal profiles while they shop. Doctors monitor pacemakers in heart patients across town and in real-time. Luxury cars avoid accidents on the road without driver intervention. In the supply chain, data is used by companies to track and trace products, analyze resource usage, communicate with people, automate machinery, and so much more. The possibilities in logistics, particularly for the food supply chain, seem endless (McKinsey & Company).
Let’s take a deeper dive into the IoT and the impacts it’s having.
Internet of Things Definition
The IoT is made up of sensor-embedded technologies that capture and transmit volumes of data from all types of objects to the Internet, machines, people, and beyond. Simply put, IoT involves connecting any device with an on and off switch to the Internet—for example a mobile phone, lamp, smoke detector, wristwatch, or something else.
Supply Chain Applications
While the IoT offers novel uses in many industries, logistics has long used tracking and other Internet applications to improve operations.
Consider Barilla, the pasta company that uses smart labels to give consumers full visibility into their supply chain. Using a cell phone to scan the package’s QR code, consumers can learn where, when, and how each ingredient made its way into that particular package, from the farm to the plant to the store shelf. Part of Barilla’s Safety for Food initiative, the IoT is helping the company fight against food counterfeiting while elevating food safety practices and their brand’s image (Food Manufacturing).
Barilla is just one example. Here are five major ways the IoT is transforming the entire food supply chain:
- Farming. Using drones, farmers capture data on crop growth, monitor weather patterns, and control water and energy usage. They also use predictive analytics to understand soil and air quality, as well as labor and equipment costs, to make more informed decisions. The result is better crop yields at lower costs (Food Industry Executive).
- Warehouse Management & Production. Food manufacturers employ sensors to tighten quality control, leveraging real-time analytics to streamline production, track and replenish inventory, monitor worker productivity, and analyze labor costs. Future applications could even remove people from the production equation. For example, machines with predictive maintenance capabilities could automatically fix their own malfunctions before they occur (Food Industry Executive).
- Food Safety. Food spoilage and contamination are some of the biggest concerns in logistics today. Combatting the issue, network-connected temperature and humidity sensors allow shippers to objectively monitor food containers and trucks, and trigger alerts that head off spoilage or replace bad products before they reach the customer. Such devices also make it easier for shippers to diagnose and fix problems fast, including pinpointing the origins of contamination and launching recalls.
Emerging applications aim to help shippers meet FSMA requirements with pre-loaded HACCP checklists, inspection reminders, and automated reporting (Food Industry Executive).
- Logistics. Bringing sweeping changes to supply chain management, the IoT is shifting approaches from a reactive to proactive stance. Advanced Radio Frequency Identification (RFID) tracking offers unparalleled visibility into the food supply chain, monitors and controls temperature, and automates shipping and delivery processes. Advanced RFID also allows shippers to track a product location with GPS, optimizing routes by analyzing data from weather patterns and real-time driving and traffic conditions. Collecting this data allows shippers to gauge performance in a number of areas, from understanding consumer behavior to reducing deadhead miles in truck fleets (Inbound Logistics).
- Consumer Applications. Shoppers already use in-store QR scanners and barcodes to get product information and coupons, and streamline the checkout process. Soon, smart refrigerators with optical scanners will automatically inform owners when they possess a recalled product, while technology-enabled smart pantries will order items for resupply automatically (Food Manufacturing).
Researchers predict that more than 34 billion Internet-connected devices will be in use by 2020, 40 percent of which will be used for business-related pursuits
(Food Industry Executive). In the supply chain, the IoT enables real-time visibility, immense data collection, and more proactive and automated problem solving than ever before. To prepare for the wave of opportunity to come, shippers must understand and effectively begin leveraging the IoT today, and partner with third party logistics companies and carriers that do the same.