Smart Warehouses: Answer to Customs-Related Supply Chain Risks

The global supply chains are facing enormous challenges due to the current U.S. trade policy: The Trump administration has created significant uncertainty and a tense situation through the announcement and retraction of tariffs. If the previously announced tariffs actually come into effect, it could have major implications for manufacturers in the U.S. who rely on the import of materials and components. They would likely have to pay 20 to 30 percent more for essential raw materials.

By: Scott Walker

(Hackensack/Düsseldorf) Supply chain managers are currently rethinking their strategies. While nearshoring or reshoring operations offers many advantages, it is not feasible for every organization. Additionally, strategies cannot be implemented overnight, and relocating production can be costly. What is needed now are tools and technologies that enable continuous monitoring and control. The Artificial Intelligence of Things (AIoT) is a promising solution for this.

Leveraging AI and IoT Together

The combination of artificial intelligence (AI) with the Internet of Things (IoT) has created new possibilities. The resulting AIoT combines the data collection capabilities of IoT devices with the analytical power of AI. This technology is applied, among other areas, in logistics to better support global supply chains.

In a warehouse, IoT sensors collect real-time data on many parameters – from the performance of individual devices to inventory levels and environmental conditions. AI algorithms analyze this data to identify patterns, predict problems, and automate decision-making processes. The result is a smarter, more responsive warehouse operation that can quickly adapt to changing demands and external pressures such as tariffs.

Increasing Efficiency Through Intelligent Systems

While rising trade costs due to tariffs cannot be controlled, optimizing the organization helps mitigate the negative effects of new developments in logistics. Thanks to AI-driven data and insights, proactive decisions can be made. This enables quicker adjustments to challenges such as customs-related supply chain disruptions. Overall, AIoT not only improves processes within a warehouse but also enhances transparency across the entire supply chain. Shipments are tracked via IoT, and AI analyzes transport data to identify bottlenecks and suggest alternative routes.

Such end-to-end transparency helps manufacturers anticipate customs-related disruptions and adjust their logistics strategies. Comprehensive visibility is the foundation for precise control and facilitates smooth operations amid global uncertainty. AIoT provides the necessary insights for better decision-making through the analysis of sensor and video data collected across all operational processes. IoT devices track the environmental conditions of loads and help ensure optimal load distribution, thereby reducing spoilage and damage. AI-powered machines and robots take over repetitive tasks, increasing speed and accuracy. Additionally, AI can track inventory in warehouses in real-time using data from IoT sensors, forecast demand, and adjust stock levels accordingly.

Benefits of Smart Technology

When integrating AIoT, challenges such as data security, investment costs, and skill gaps must be considered. Training the workforce is essential to ensure that advanced or new systems are operated correctly. An integrated approach – combining modern technology with employee empowerment – eliminates blind spots along the entire supply chain. Moreover, it maintains consistently high standards in logistics even during challenging times.

Modern warehouses are under immense pressure to deliver faster and operate more efficiently – and this pressure will intensify when the announced tariffs come into effect. This pressure to meet key performance indicators (KPIs) and control costs can lead to workplace accidents in logistics. The statistics are alarming: In Germany, approximately 100 people are injured daily in accidents involving forklifts, sometimes with fatal outcomes.

Innovative technology with AI also offers a solution here that ensures safety without compromising productivity. Instead of reacting to accidents, companies can rely on AIoT solutions that predict risky situations through continuous monitoring, issue preventive warnings, and enable early countermeasures. Such a system can continuously document activities in front of and behind forklifts and assess employee behavior in the vicinity. This way, hazards can be mitigated, and safety can be sustainably increased.

Global Trade is Becoming More Dynamic

When companies focus on improved efficiency and safety through unified operational intelligence, they can optimize processes and reduce costs. This increases their resilience to disruptions such as the currently uncertain customs policy. Efficient warehouses minimize costs, ensure high employee protection, and maximize customer satisfaction through improved processes.

As global trade becomes increasingly dynamic, manufacturing warehouses must be agile and resilient. Therefore, the question is not whether companies should adopt AIoT, but how quickly they can do so. By leveraging technology, they can maintain their agility and resilience in the long term and remain competitive. This approach positions companies to be well-prepared to handle current situations and future challenges – regardless of how global trade will evolve in the coming weeks, months, and years.
 

Scott Walker is Vice President of Supply Chain Product Management at Powerfleet and leads Powerfleet’s supply chain product teams to develop innovative products and solutions. Walker has over 25 years of experience in leading product strategies, technological innovations, and executing product developments. In the last 15 years, Scott Walker has held various positions in Powerfleet’s product, implementation, and sales teams. Before joining Powerfleet, he held various leadership positions at Emerson Electric in the industrial automation group. He attended the University of Rhode Island and earned a BS in Chemical Engineering. Photo: © Powerfleet

Title photo: © Loginfo24