When it comes to paperwork, the transportation and logistics industry is somewhat outdated compared to the other sectors. Paperwork is an essential aspect of the logistics sector that revolves around several repetitive tasks like mailing invoices, data input, signing bills, etc. Therefore, in the absence of document digitization, a great majority of these processes are still being done manually. This is obviously taking a toll on the productivity, cost-effectiveness, and competitiveness of the freight forwarding sector. The advancement of digitization has made available several technological solutions that are helping the industry to gradually transform into a paperless sector with the online management of documents. Keep reading today’s post to find out about the importance of digital documentation in the transportation and logistics industry.
Why the transportation and logistics industry needs to go paperless
The logistics sector leaves a paper trail for all its operations, from management to inventory tracking to international shipping and warehousing. For decades, documentation of international trade has been reliant on physical documents that need to be submitted and exchanged by post or courier services. Therefore, lost or damaged documents are a frequent matter of serious concern for shipping companies, and documents with the slightest errors could even result in cancelled shipments. Regardless of the volume or nature of the shipment, there are too many documents just for a single logistical process. Additionally, the slightest error in manual paperwork can take a serious proportion and result in delayed or cancelled cargo.
The use of paper is becoming irrelevant in this industry, especially in this era of digitization. Manual inventory takes up a lot of the valuable time of the companies and necessitates an additional workforce. Automated platforms allow companies to save a lot of their precious time, eliminate inaccuracies, reallocate resources elsewhere, and keep pace with the changes in the industry.
Advantages of electronic documents in the logistics sector
Benefits of the e-CMR
The CMR Waybill is a very important document in the road freight industry that is carried out between the transporter, the forwarder, and the carrier during international freight movement by road. CMR has always existed in paper forms which require filling out all the necessary fields and even re-entering duplicate information in more than one form. As the result, the process was often time taking and prone to human errors. An e-CMR is the digital version of the CMR where all the data exchanged between the parties are stored in one single online platform. Additionally, it also tracks the progress of the shipment in real time, monitors the movement of the cargo, and confirms the right delivery time with all the stakeholders of the shipment. Simply put, e-CMRs have substantially added to the transparency of road freight operations and made the entire shipping process more efficient.
Benefits of digital signatures
A digital signature is a digital version of a handwritten signature that is done with the help of an electronic device. It is like a coded message whose task is to relate the signatory with a document in a particular deal. They considerably cut down the time required to fill out paper documents and make way for quicker services. Moreover, it does away with the labour-intensive process of manually signing the paper works which in turn allows the logistics companies to focus on more important jobs like finding new projects and making on-time deliveries.
Additionally, it is also very cost-effective since it helps forwarders save a lot of money that is otherwise spent on printing, courier, shipping, paper, and physical data storage. The digital portal that is responsible for the e-signature stores all the data and even tracks the persons who have signed or not signed the document. They also make sure that the document is never misplaced.
Benefits of QR Codes
QR codes or Quick Response codes are barcodes that can be read by electronic devices. Just like barcodes, they store data, but rather than storing limited information they can store up to 7,089 numeric or 2,953 alphanumeric characters. QR code labels on goods can be of great help for tracking inventory and even tracking cargo at various stages during transit. Lastly, the Google Maps QR Code can even help the delivery agents to the encoded location on their phone’s maps application.
Benefits of RFID systems
RFID Systems allow logistics managers to conveniently track and manage products and assets in the supply chain. RFID tags along with QR codes can vastly improve cargo handling both inside and outside the warehouse environment. They can help with several tasks starting from inventory management to automation. They allow for data accuracy by eliminating the need for handwritten documents and the possibility of manual data entry errors. Moreover, both RFID tags and QR codes allow workers to complete a task in minutes that previously used to take hours. They help to save time by instantly identifying items and entering their information into the central computing system.
Advantages of Electronic Bill of Lading
In order to eliminate the several drawbacks of paper B/L, the transportation and logistics industry is seeking solutions that can enhance document processing while driving time and cost efficiency. Since as early as the 90s the shipping industry has been making several attempts to come up with a solution for paperless shipping operations.
The advent of the blockchain technology has provided a new impetus to the Electronic Bill of Lading offering new innovative solutions. The E B/L will eventually replace the paper document of B/L along with courier services with a digital document that can be transferred via a cloud-based system. The electronic bill of lading doesn’t simply imply a digital version of a paper bill of lading. It is like an e-document that is created, approved, and exchanged digitally via blockchain or cloud computing. However, as one of the most important shipping documents, the hard copy of the Bill of Lading is still required in up to 40% of all trade transactions in shipping.
Benefits of EDI
Electronic Data Interchange or EDI is the transfer of commercial documents from partner to partner. The exchange of business documents from computer to computer contributes to the seamless workflow of the logistics companies making the process of documentation exchange more simple and reliable. EDI includes logistics paperwork such as invoices, dispatch data, purchase orders etc. Digital exchange of data allows companies to do away with the manual process, enhance traceability, cut expenses, lower human errors and make way for for effective communication between the stakeholders.