Maximizing Efficiency of the Logistics Industry: A.I. Route Optimization

dKargo will provide a new level of logistics services through flexible collaboration among participants that was impossible to achieve in the existing system. From the customer’s perspective, freights were often delivered and stored in an inefficient way due to a lack of collaboration. For example, a freight from one city can be sent out to a distribution center outside the city, only to be delivered back to the city. Another example would be customers having to wait for their parcel to be collected at their homes. These problems can be solved if logistics service is performed with diverse participants in a flexible, purpose-driven manner. dKargo will design an optimal route through data sharing and collaboration to build a better functioning logistics network.

Currently, logistics service is carried out by a single company or through a few participants who are closely connected to one another. This can be problematic because that single company is solely responsible to carry out all the tasks even in sectors where they don’t have expertise. As a result, relatively less competent participants will provide poorer services than more qualified participants existing in the market. This leads to a cost increase and poor customer experiences.

The most efficient participant for each sector of the supply chain will provide services which will increase the efficiency of the overall logistics network. Customers can find the most optimal logistics network route based on the recorded data of each participant on the blockchain. This will allow customers to have their goods delivered to them in the most efficient way. And logistics service providers can focus on their strengths and make better, more efficient use of their limited resources. dKargo provides an opportunity for each participant to enhance their strengths, thereby raising the efficiency of the entire logistics network.

The logistics industry is one of the main industries where economies of scale play into factor, which means that the more freight volume a company has, the lower their operating costs will be. Until now, logistics companies competed to gain more freight volume by using economies of scale to their advantage. Realistically speaking, there are limitations to the freight volume a single company can handle. There are also situations where delivery trucks are starting their delivery half-empty or where the delivery period is delayed because trucks have to wait to be fully filled. Such inefficient operation ultimately results in a unit price increase and poor customer experiences.

In this regard, dKargo offers a solution to maximize economies of scale by encouraging collaboration among participants to gather the freight volume for the same route. Each participant can find each other’s contractual information on the public ledger available on dKargo’s platform and trade their delivery volume, if necessary, to maximize the freight volume for each route. Available resources and logistics data that is generated by real-time tracking on dKargo’s platform will also be used for machine learning and help participants to fully utilize their resources. Individual participants can minimize the time required to obtain the freight volume needed for each route and also create economies of scale that wasn’t possible in the current system. dKargo can provide a better customer experience by drastically lowering the cost of logistics services while reducing unnecessary operational time.