What Are the Logistics Technology Trends to Watch in 2025?

Machine learning. Robotics. IoT. Any one of these tech developments would be disruptive, but having all of them hit the last-mile industry at once is head spinning. And for those looking just a little further ahead, quantum computing — now in its infancy — is poised to be the next major advance that reshapes logistics from top to bottom.

The bottom line for logistics organizations is simple: Keep up with the tech bus or get run over by it. Delivery operations that embrace new tech as it appears do more, do it better and do it at a lower cost. 

Your customers want quick shipping, real-time visibility, flexibility, and great customer service. And you need to make a profit. Technology can make all of those things happen simultaneously. Falling behind in the technology arms race is not an option. Companies that evolve with technology are the ones that will survive.

What Are the Logistics Technology Trends to Watch in 2025?

In the logistics industry, digital technology adoption began accelerating rapidly at the beginning of the COVID-19 pandemic, and it's remaking all parts of the industry from e-commerce to the global supply chain.

A McKinsey Global Survey of executives showed that COVID-19 response hastened the adoption of digital technologies by three to four years. Many companies that implemented short-term solutions to meet those new demands have kept up a rapid pace of change in responding to the "new normal."

Digitization and last mile software are proving efficient tools for B2B delivery operations, B2C businesses, carriers, and shippers. Here are the logistics technology trends that will shape the industry in 2025 and beyond.

Automation

On-demand deliveries were already on the rise even before the pandemic, forcing businesses to make major changes including automation. The pandemic accelerated the need for automation, and rising costs and ongoing labor shortages have further cemented it.

Automation in distribution centers or warehouses pertains to anything from process automation to physical automation. Some of the usual warehouse automation includes digitization of manual processes, pick-to-light systems with operators using barcodes to scan and LED lights indicating the number of items for pick-up and their destination, and autonomous mobile robots and co-bots working inside warehouses.

Businesses will continue to automate many of their processes at varying levels depending on their warehouse or distribution center sizes as well as volume and types of orders they regularly fulfill.

Democratization of Technology

The presence of SaaS technology options for logistics makes it possible for more companies to take advantage of cutting edge logistics technology. Previously only large logistics businesses could afford the long-term infrastructure and IT projects required to run the most advanced software; now the burden is on the SaaS software provider to keep everything running smoothly.

This means that businesses that previously would have been stuck leveraging legacy solutions or using manual processes can now compete with larger businesses on the technology front. Access to the same technology makes every David a potential Goliath. 

Artificial Intelligence and Machine Learning

Even as buzzier technologies like ChatGPT garner big headlines that promise big future returns for business, the focused application of AI and machine learning in logistics is making a real impact right now. 

The use of AI and ML to identify every link in the supply chain will continue. When used for decision-making in the supply chain, AI reduces human error. AI in warehouse management makes planning much easier by reducing the time required for analysis.

Demand prediction is also much easier. AI can quickly digest multiple factors that influence demand as well as historical demand data. Last mile logistics analysis and optimization, supplier selection, and workforce planning can be dramatically improved by AI and ML. In short, AI and ML offer tangible results and are useful in solving some of the most complex issues in logistics.

AI and ML are also being used for supply chain predictive analytics in a way that's grabbing the attention of industry players. They are helpful in demand forecasting of products so logistics companies can optimize the use of their warehouses by segregating low demand products from high demand goods. That efficiency also translates from the warehouse floor to the customer's front door when AI/ML is used to power route optimization. 

Internet of Things (IoT)

IoT is one of the logistics technology developments that are transforming all aspects of our lives. In logistics, expanding IoT is creating more connections between goods, packaging, transportation hubs, and vehicles. It facilitates collection of more data that helps in managing assets remotely, predicting risk, ensuring proper cargo handling, and forecasting traffic congestion.

Transportation Management Systems (TMS)

TMS systems are growing in popularity especially among logistics firms. And rightly so given that many technological tools need to be organized and managed in one common center. Properly set up and integrated with the right platforms, TMS can manage carriers and optimize routes tracking delivery drivers in real-time, lowering freight expenses, increasing transparency, and improving overall customer satisfaction scores. Seamless integration between TMS and your last mile technology — making sure all platforms communicate bi-directionally – makes the entire stack more effective.

Across every industry, digital transformation is occurring faster than expected. While many companies were not prepared to make a quick digital transition when the pandemic struck, they nevertheless adopted new logistics technology quickly. Those technologies have created two classes of delivery organizations — the ones who are on the technology bus and those who are watching it bear down on them.