Logistics and supply chain in the next 30 years

Article by Leonardo Julianelli

During the 30th International Logistics and Supply Chain Forum, ILOS executive partner Leonardo Julianelli closed the first day of the event by presenting the results of a study we conducted on the history of the supply chain in Brazil over the last 30 years and its prospects for the next 3 decades, which I will take the opportunity to share the main insights here.

Over the next 30 years, logistics and supply chains will face unprecedented challenges that will profoundly transform the sector. Just as the last three decades have been marked by the integration of logistics functions and the search for efficiency, the future will require a more connected and customer-centric vision, with agile, sustainable responses that are adapted to new consumption patterns and environmental demands.

A world of conflicts and new geopolitics: rethinking the location of production

The current geopolitical instability, with growing tensions between major powers, could lead to a new configuration of global chains. Escalated conflicts and the resurgence of global divisions could create a kind of new “iron curtain,” fragmenting the international market. Countries that previously centralized production are now rethinking their strategies, aiming to dilute risks with more fragmented operations closer to their main markets and in countries with good political relations, trends known as “nearshoring” and “friendshoring.” Companies in Brazil must prepare for a new flow of trade, anticipating possibilities of becoming an alternative or complementary link to these new global routes. However, this requires improvements to the national logistics infrastructure.

Labor shortages and transformation of work models

With an aging population, there is a decrease in the availability of professionals to work in traditional logistics roles, such as drivers and freight operators. This trend highlights the need to create models for attracting and retaining people, making logistics a more attractive career for younger generations, which includes rethinking the work model, with competitive salaries, benefits and career opportunities. At the same time, the increase in autonomous vehicles and other technological innovations could be a solution to this shortage, but they require adequate investment, infrastructure and regulation.

Artificial intelligence (AI), quantum technology and autonomy in decision-making

With the advancement of AI and automation, logistics can reach unprecedented levels of orchestration and efficiency. The ability to capture and process information in real time for autonomous decisions will be a competitive differentiator. However, today’s AI technologies are still energy-intensive and face computational limitations. In the more distant future, quantum computing and neuromorphic computing can solve these issues, enabling AI with near-human cognitive capabilities. However, application at scale still depends on technological advances and control over environmental operating conditions.

For this integration to occur, it will be essential to develop a data infrastructure capable of protecting and, at the same time, enabling the secure and agile sharing of information between partners in the chain, which makes cybersecurity a strategic element of vital importance for the supply chain of the future.

The climate crisis and the imperative of decarbonization

Global warming is no longer a future possibility, but a reality that directly pressures logistics operations, especially agricultural supply chains and those that depend on climate-sensitive natural resources. In addition to the growing demand for energy, the sector faces challenges in making an urgent transition to sustainable energy matrices and minimizing carbon emissions. In the short term, the challenge is to create infrastructure, partnerships and policies that align logistics and transportation with low-carbon standards. In the long term, this means radically transforming the energy matrix and investing in technologies that do not require the burning of fossil fuels. 

The new role of logistics operators and the capillarity of e-commerce

E-commerce is far from having exhausted its growth potential, and portfolio diversification and order fragmentation will require more distribution and fulfillment centers, new routes and greater capillarity of logistics services. In this context, the evolution of the role of the logistics operator will become crucial, offering faster deliveries and aggregated services, partially replacing traditional distributors and reaching the end consumer. 

Investments and strategies for the future of the supply chain

Looking to the future of logistics in Brazil means preparing today with the right decisions and creating an environment that can adapt to the rapid changes in the global market. Investments in infrastructure, technology, partnerships and new skills will be decisive. We will have to build a logistics system that not only meets the needs of the market, but also helps define industry standards for a more complex, connected and customer-oriented world.

The next 30 years will be marked by the ability to adapt to environmental and technological demands and by the choices that companies and governments make today to create resilient, agile and sustainable logistics. As major insights, we can highlight:

• Adapting to the new is a continuous necessity, especially in a scenario of growing uncertainty, where being well prepared becomes essential for success. 
• The present is the ideal time for decisions and positions that will shape the future, requiring strategic choices. 
• While the skills required change, the role of humans remains indispensable, highlighting the importance of human intelligence and judgment in the supply chain. 
• For intermediary links to continue to be essential, it is vital that they add intelligence to their services, transforming themselves to meet the new demands of an increasingly complex and dynamic market.

References

• Lecture “LOGISTICS 30+30: HISTORY AND PERSPECTIVES OF THE SUPPLY CHAIN ​​IN BRAZIL”, presented by Leonardo Julianelli at the International Supply Chain Forum, on 15/10/2024