How the UAE can 'future-proof' supply chains

Will Green is news editor of Supply Management
11 October 2022

The logistics sector in the UAE is set to be worth $31.4bn by 2026 and accelerating digital capabilities will be critical to economic competitiveness, according to a report.

The report, Destination Digital: The Future of Logistics by investment company ADQ, said the sector would grow by 8.41% against a backdrop of increasing e-commerce, which was prompting logistics firms to optimise distribution through digital means.

The report said data analytics, automation, and digital platforms would “increase supply chain productivity, minimise costs, and foster greater transparency”.

“The acceleration of e-commerce over the past two years has also triggered a shift towards digitalisation in the sector, encouraging logistics companies to prioritise optimal distribution through automation, internet of things, blockchain, and new warehouse management procedures,” said the report.

This would encourage “the emergence of a data-driven interconnected global logistics network for a more secure and future-proofed supply chain”.

ADQ identified five of key drivers:

1. Digitised customer interactions. This will improve the speed and quality of service, including personalisation and customer targeting, while lowering the cost of sales.

2. Improved operational efficiencies. Data analytics and automation can increase asset utilisation and reduce costs through ways such as predictive maintenance.

3. Enhanced data ecosystems. Collaboration between carriers, terminals, and customers will create data pools, increase value, and produce greater efficiencies.

4. Increased “door-to-door” business. Digital channels can simplify shipments, particuarly for simple transactions.

5. Public-private partnerships. Cooperation among industry players will accelerate digital adoption across the supply chain.

“As the UAE accelerates its economic development, the national supply chains that are essential to facilitating global trade will be at the heart of this transition,” said the report.

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