Smart Logistics Based On The Internet of Things Technology
Smart Logistics Based On The Internet of Things Technology
Applications
A Leading Journal of Supply Chain Management
To cite this article: Yangke Ding, Mingzhou Jin, Sen Li & Dingzhong Feng (2020): Smart logistics
based on the internet of things technology: an overview, International Journal of Logistics Research
and Applications, DOI: 10.1080/13675567.2020.1757053
Article views: 2
1. Introduction
New technology, new market entrants, new business models, and new customer expectations cur-
rently cause the logistics industry to face immense change, which brings both risk and opportunity
(PwC 2016). New technologies, like the internet of things (IoT), cloud computing, big data, and
blockchain, greatly streamline the logistics process and improve its efficiency. New entrants take
market share from the incumbents through new business models based on new technologies. For
example, Uber Freight (https://www.uberfreight.com) connects carriers with the most appropriate
shipments available and builds an on-demand logistics network with its app and platform, which
has negatively impacted the American freight industry. Customers expect to obtain goods faster
and safer as well as with more flexibility at low or no delivery cost. The above new things increase
efficiency and customer satisfaction but produce fiercer competition. Some logistics companies may
go out of business if they fail to develop current logistics systems (Akgul 2019). To build smart logis-
tics based on new technologies is an effective solution to keep up with the new things.
The definition of smart logistics is widely divergent and there are no unanimous conclusions so
far. However, smart logistics usually refers to different logistics operations, like transportation, ware-
housing, and customer service, which are planned, managed, and controlled in a more intelligent
way than conventional solutions. The type and level of intelligence vary across applications and
focuses. Autonomous logistics (Windt and Hülsmann 2007), intelligent transportation system
(ITS) (European Commission 2019), the Physical Internet (PI, π) (Montreuil, Meller, and Ballot
2013), smart freight (Sternberg et al. 2010), and customer-oriented intelligent logistics (Mcfarlane,
Giannikas, and Lu 2016) are typical types of smart logistics. They are summarised in Table 1.
As shown in Table 1, although smart logistics has various types due to their respective priorities,
they all depend on the application of ICTs. We here offer a new working definition of smart logistics,
which is based on state-of-the-art technologies and advanced management and focuses on the flow
of goods. The logistics components that reflect the flow of goods mainly include freight transpor-
tation, warehousing, and delivery. The concept map of smart logistics is illustrated in Figure 1.
As shown in Figure 1, the logistics processes, i.e. freight transportation, warehousing, and deliv-
ery, in smart logistics can become information sharing, rapid response, and resource integration
through the collaborative application of IoT, big data, cloud computing, and artificial intelligence
(AI) as well as advanced management. The collaborative development makes smart logistics a col-
laborative and integrated system. It also makes logistics operations more intelligent than the tra-
ditional way. In conclusion, smart logistics makes the logistics system collaborative, intelligent,
and integrated and achieves information sharing, rapid response, and resource integration in the
logistics process by the adoption of advanced ICTs and management; from the perspective of cus-
tomers, smart logistics provides more efficient, flexible, accurate, and safer logistics services.
The key to developing smart logistics is to effectively take advantage of state-of-the-art technol-
ogies. Among them, IoT technology has been most widely applied in the logistics system (Chow et al.
2006; Xiao et al. 2016; Sharma et al. 2018). IoT is an information and communication technology
based on the internet (Ashton 2009; Weber and Weber 2010; Feng et al. 2012). It applies a variety
of information sensing technologies, such as RFID, wireless sensor network (WSN), and machine to
machine (M2M), and adopts the embedded system as well as combines network communication
technology to achieve data communication, exchange, and control with unique identifiers among
objects. IoT is committed to extending from the virtual internet to the physical world (Uckelmann,
Harrison, and Michahelles 2011), and its mainstay of development is self-identification, information
transfer, and interactive processing among objects (Miorandi et al. 2012). IoT applications enable
M2M and human-to-machine interactions (Atzori, Iera, and Morabito 2010). The technology
aspects of IoT have been well-reviewed and interested readers can refer to Miorandi et al. (2012),
Mishra et al. (2016), Ng and Wakenshaw (2017), Whitmore, Agarwal, and Li (2015), and Li, Wu,
and Li (2014).
Although IoT technology has been widely used to support smart logistics, especially in freight
transportation, warehousing, and delivery, to the best of our knowledge, few works systematically
and extensively describe the research and applications of IoT-based smart logistics in the literature.
The recent related literature has focused either on a subset of IoT technologies or on vague descrip-
tions of logistics. Musa and Dabo (2016) reviewed the applications of RFID in supply chain manage-
ment from 2000 to 2015. Naskar, Basu, and Sen (2020) also reviewed the applications of RFID in the
domain of supply chain management. Bendaya, Hassini, and Bahroun (2019) explored the impact of
IoT on supply chain management which partially involves logistics. To bridge this gap, we review
and analyze the research and applications of IoT technology in freight transportation, warehousing,
and delivery.
The contributions of this paper to literature are in three parts. First, we present a new definition of
smart logistics, which will be used for the remainder of this paper. Second, the research and appli-
cations of IoT in logistics are reviewed and summarised, which demonstrates the role and impact of
IoT on smart logistics. Last, we point out challenges of smart logistics based on IoT and provide
research needs for the development of smart logistics.
The rest of this paper is organised as follows. Review methodology and bibliometric analysis are
presented in Section 2. In Section 3, the research and applications of IoT in freight transportation,
warehousing, and delivery are reviewed and analyzed. The challenges of IoT-based smart logistics are
pointed out in Section 4. In Section 5, the research needs for developing smart logistics are presented.
Section 6 concludes this paper. A list of acronyms and terms is shown in the Appendix.
need to modify and refine the search to exactly accord with our review topic. The principles of the
search are limited to the following points:
. Focus on articles from high-quality journals. We only search for articles from the Science Citation
Index Expanded and Social Sciences Citation Index in the Web of Science Core Collection (http://
www.webofknowledge.com/wos). Conference papers, book chapters, and review papers are
excluded.
. Focus on the time when IoT began to be popular. We searched for articles in the last 12 years
(2008–2019). The Internet Business Solutions Group of Cisco estimated that IoT was ‘born’
(became popular) sometime between 2008 and 2009 (Evans 2011).
. Focus on freight transportation, warehousing, and delivery in the logistics industry. We combined
the search for ‘freight transportation, warehousing, and delivery’ with ‘logistics’.
. Do not omit keywords about IoT. IoT technology is a broad concept, we do not retrieve articles
with just ‘the Internet of Things’ or ‘IoT’. We extended the keywords of IoT to smart things, RFID,
intelligent sensing, wireless sensors and actuators, WSNs, M2M, Near Field Communication
(NFC), Z-Wave, Bluetooth Low Energy (BLE), low energy wireless communications, and ZigBee.
After refining, there were 22 articles returned correlating to freight transportation, 63 articles to
warehousing, and 54 articles to delivery. We removed some of the articles and added some other
qualified papers through their references, according to the relevance to our review topic. Finally,
we reviewed 16 articles on smart freight transportation, 29 articles on smart warehousing, and 25
articles on smart delivery, totalling 70 articles.
technology, which greatly promotes the research and application of smart logistics. Except for China,
the rest are highly developed countries or regions or unions, showing the lack of research and appli-
cation of smart logistics in the vast majority of developing countries.
Positioning System (GPS) and a geographic information system (GIS), are usually combined with
RFID to provide navigation, route planning, and transportation process monitoring (Liu et al.
2019; Zacharewicz, Deschamps, and Francois 2011; Cheung et al. 2008). GPS is used to locate
and track a vehicle’s location in real-time; GIS provides a spatial distribution of roads and related
facilities, road conditions, and the optimal routing navigation services for drivers.
IoT technology, especially WSN, improves the monitoring and security level during transpor-
tation. Remote measurement of product core temperature with WSN is important to guarantee
food quality and reduce losses for perishable goods (Jedermann, Pötsch, and Lloyd 2014). That is
because the perishability of perishable goods is always related to the storage environment. Ambient
sensors are exploited to obtain temperature and respiratory (oxygen and carbon dioxide) data, which
monitor the goods storage environment during transportation (Zhang et al. 2019). The above moni-
toring achieves non-invasive measurement and acquisition with higher efficiency and greater secur-
ity. During the monitoring with WSN, RFID can be used to detect changes in load, identify drivers,
save WSN configuration, and maintain the desired environmental requirements (Santa et al. 2012).
As a result, goods can be tracked, traced, and monitored during transportation. It is worth mention-
ing that WSN for condition monitoring in railways improves the safety, security, and reliability of
railway freight transportation (Shrestha et al. 2013; Fraga-Lamas, Fernández-Caramés, and Castedo
2017; Hodge et al. 2015). WSNs can be used to monitor and assess the condition of railway infra-
structures such as tracks, track beds, bridges, and the equipment placed on the tracks. This condition
monitoring achieves real-time fault alerting of freight railcars.
In Table 2, we summarise and classify smart freight transportation based on IoT according to the
major mode of transportation. Noted that RFID and WSNs technologies are widely exploited in
road, waterway, and railway freight transportation. There are common impacts of IoT on these
three transportation modes, including real-time tracking, tracing, and monitoring of transportation
facilities and goods. The specific impacts of that on road freight transportation are to support vehicle
route optimisation and fleet management. Containers in waterway transportation are not convenient
to open for inspection. Fortunately, RFID can provide unique identifiers and electronic container
seals, and WSNs can conduct non-invasive monitoring and measurement. The impact of IoT on rail-
way freight transportation focuses on condition monitoring and alarm of various railway infrastruc-
ture. However, we cannot find studies that examine the strategic level impacts of IoT on freight
transportation, such as transportation network design and mode selection.
We summarise and classify the smart warehousing based on IoT according to the type of ware-
housing activities, as shown in Table 3. The activities comprise inbound (receiving and storage allo-
cation) and outbound (order picking and truck loading) activities. IoT technology not only connects
the warehouse recourses, like SKUs, pallets, shelves, and operators, to provide decentralised decision
support and then to streamline warehousing process, but also integrates inbound with outbound
activities through more accurate and visual warehouse data. IoT ensures inbound and outbound
security by monitoring warehouse entities and environments. However, IoT cannot effectively
solve the problem of storage allocation strategy selection and indoor routing optimisation.
delivery man who carries a mobile terminal that integrates a GPS receiver and an active RFID tag can
be tracked with his real-time location both indoors and outdoors (Lin, Cheng, and Wang 2011).
Here, GPS provides the outdoor geographical coordinates, and RFID is used for indoor positioning.
The visibility of cargo and its storage environment, during delivery, can be achieved through cloud-
based GIS, GPS, and smart measurement devices connected with different sensors (Bogataj, Bogataj,
and Hudoklin 2017).
IoT technology contributes to ensure delivery reliability and reduce delivery failure. RFID is
always regarded as an identifying and tracking tool for the status of goods and vehicles to increase
delivery reliability, like correct orders and timely delivery. Losses of goods and wrong destinations
can be dramatically cut down with the introduction of RFID (Fu et al. 2015). Cargo theft can be
reduced significantly by using RFID multilayered grouping proof methods (Yang, Luo, and Lu
2015) or adopting accessible off-the-shelf mobile devices, RFID, and Geofence techniques (Oliveira
et al. 2015). Vehicle rescheduling during an accident can be supported by the integration of GPS,
RFID-based e-seals, and mobile network technologies (Ngai et al. 2012). Loss of goods during deliv-
ery can also be prevented by monitoring truck status with WSN. For example, the ambient light sen-
sor can provide events information, like loading and unloading, and detect an unauthorised opening
of truck doors (Ruiz-Garcia et al. 2010). Safe driving can be achieved by making use of sensor infor-
mation, like vehicle speed and engine speed, and drowsy driving can be detected with a wearable
sleepiness detection sensor (Kido and Nakamura 2016). In addition, a QR code is used to provide
a privacy-preserving delivery service and implement the authentication of couriers (Gao et al. 2018).
IoT technologies, especially WSN and RFID with sensors, can guarantee the safety and quality of
goods, particularly perishable products, by collecting, monitoring, and tracking ambient environ-
mental conditions during delivery. The ambient environmental information, like temperature and
humidity, can be collected automatically with WSN, monitoring the products throughout the distri-
bution (Tsang et al. 2018). This information can be checked by customers and provide feedback and
instructions to staff. Temperature sensors are widely used in the cold chain delivery process of fresh
fish (Trebar, Lotrič, and Fonda 2015), refrigerated vegetables (Ruiz-Garcia et al. 2010), and medicine
(Yang, Yang, and Yang 2011) where temperature needs to be strictly controlled. The sensing infor-
mation from WSN can measure and collect environmental indicators and goods status, to forecast
the perishability of goods and track ambient control (Bogataj, Bogataj, and Hudoklin 2017). Feed-
back control is performed through actuators according to a prescribed criterion function. Some
researchers integrated the RFID and WSN technology to guarantee that delivery items are held
under proper environmental conditions (Kim et al. 2016; Shi, Zhang, and Qu 2010).
IoT makes the delivery service safer and more accurate. The delivery process and information can
be tracked, visualised, and communicated. Smart delivery effectively guarantees reliability and
reduces failure. We summarise and classify IoT-based smart delivery according to the type of
goods delivered in Table 4. IoT technology plays slightly different roles in different types of goods
delivered. Smart delivery of general cargo focuses on the status of delivery and makes sure that
the goods are safely and accurately delivered. Considering the characteristics of perishable products,
extra attention should be paid to the perishability of goods during delivery. Therefore, the environ-
mental conditions of perishable products are necessary to be monitored, measured, and collected.
Meanwhile, ambient control should be conducted. However, compared with the control of delivery
processes, not many studies investigate how to make delivery faster and optimise delivery resources
with IoT.
4. Current challenges
4.1. Technical problems of RFID
RFID is susceptible to electromagnetic interference even under normal working conditions (Aviles
Gonzalez, Smith, and Vargas-Rosales 2015). For example, RFID is subject to electromagnetic
INTERNATIONAL JOURNAL OF LOGISTICS RESEARCH AND APPLICATIONS 11
interference and collision damages in container transportation due to stacked metallic containers, thus
affecting location and identification (Hidalgo Fort et al. 2018). RFID also has the problems of tag col-
lision (Wang et al. 2014; Chen and Zhao 2019) and tag identification loss (Zhao, Li, and Li 2014).
Although RFID makes the inventory and goods management more efficient, the classification statistics
of massive tags become a troublesome problem (Huang et al. 2019). Multiple reading and omission
errors are the major technical problems of RFID utilisation in a warehousing setting (Kim, Yang,
and Kim 2008). Receiving errors will be triggered when the frequency from the RFID tag is weakened
or blocked by the stocking of goods or metallic packaging materials. In addition, Pereira et al. (2013)
pointed out that RFID tags and sensors are subject to cost, energy consumption, and network deploy-
ment. For example, the data stored in the RFID can only be captured where RFID readers are in place,
usually at transit points like ports or warehouses, which limits the widespread adoption of RFID and
affects the tracing resolution (Harris, Wang, and Wang 2015; Santa et al. 2012).
logistics is limited to partial logistics system integration and intelligent support. In addition, there are
dynamic delays and connection problems in the transportation/delivery data transmission under the
current wireless communication networks, like GPRS/GSM (Zacharewicz, Deschamps, and Francois
2011). It is not conducive to the rapid response and decision-making of incidents, such as tempera-
ture control and alert transmission, during transportation/delivery.
access control, and user privacy assurance, should be strengthened. Lin et al. (2017) point out that
IoT can be attacked in many ways from the perception layer, network layer, and application layer.
Data privacy risk may lead to information disclosure, which triggers the abuse of tracking user pre-
ferences and schedules. Users, including couriers and customers, have concerns about data security
and privacy violations in the tracking of logistics processes. Logistics companies are also worried
about data being stolen by competitors (Lin et al. 2017). Security and privacy concerns are particu-
larly serious under information sharing. For example, the privacy issue is the largest concern for
shared delivery, given the nature of the open access and resource sharing of connected vehicles
(Wang et al. 2019).
5. Research needs
5.1. Development of IoT technology
IoT technology has been developing in performance and function. Many anti-collision algorithms
for RFID tags have been constructed to avoid tag collisions (Chen 2015; Su et al. 2018; Chen and
Zhao 2019), and several novel protocols have been proposed to identify the missing tags (Chen,
Xue, and Wang 2017; Shahzad and Liu 2016). The sensor’s battery life can be extended by optimising
communication protocols and by in-network preprocessing of the sensor data (Jedermann, Pötsch,
and Lloyd 2014). In addition to the improvement of IoT, its supporting technologies are making
great progress. Internet Protocol version 6 (IPv6) uses 128-bit (16-byte) addresses whose space sup-
ports approximately 340 undecillion addresses (Wollschlaeger, Sauter, and Jasperneite 2017). These
almost inexhaustible addresses provide tremendous support for the addressing of any number of
objects needed in IoT. The coming fifth-generation of cellular networks (5G) brings greater speed
(to move more data), lower latency (to be more responsive), and lower energy and cost (to be econ-
omical) than ever before (Andrews et al. 2014). 5G architecture is expected to accommodate a wide
range of use cases in IoT with higher requirements for latency, resilience, coverage, and bandwidth.
However, there is no end to the development of technology and the actual demand. It is a research
need to further solve the above tough issues of IoT in Section 4.
agile approaches to facilitate resource sharing and participant collaboration in the whole supply
chain life cycle (Yan et al. 2014).
5.2.3. AI
AI is used to simulate, learn, and extend human intelligence with machines (Russell and Norvig
2009). AI makes it possible for machines to learn from experience, adjust to new inputs, and perform
human-like tasks. Computers can be trained to perform specific tasks by using deep learning (Lecun,
Bengio, and Hinton 2015) and natural language processing (Collobert and Weston 2008). Specifi-
cally, it can forecast future states and make precise judgments with the deep learning of large histori-
cal data and real-time information. It can also judge and distinguish valuable and invalid
information. Mass data collected by IoT can make AI more powerful, accurate, and intelligent,
and then the decision made by AI can be executed by IoT devices. Furthermore, AI enriches the per-
ceptive function of IoT. For example, machine vision (Davies 2012) makes robots collect more real-
time data and undertakes more efficient and precise identification and detection. Biometrics, such as
fingerprint recognition (Maltoni et al. 2009) and face recognition (Zhao et al. 1998), achieve a better
interaction between human beings and machines.
Smart logistics supported by AI can provide better decision support for logistics activities and
make the optimal operation strategy. Some intelligent algorithms have been used to solve route
optimisation problems in logistics. Genetic algorithms have been adopted to optimise transpor-
tation and delivery routes (Cheung et al. 2008; Tsang et al. 2018). An evolutionary ant colony
algorithm has been exploited to guide the routing of automated guided vehicles in an automated
warehouse (Zhou et al. 2014). Besides, intelligent algorithms can be used to solve truck or ship
INTERNATIONAL JOURNAL OF LOGISTICS RESEARCH AND APPLICATIONS 15
loading problems (Kim et al. 2008). A CBR engine has been used to provide decision support in
warehousing operations. CBR usually adopts real-time warehouse data, like identities and
locations, collected by RFID to develop a warehousing operation strategy when problems
occur in the warehouse (Lam et al. 2015). The CBR engine can generate operational assignment
activities by retrieving and analysing relevant knowledge stored in the case-based repository to
deal with receiving operations in the warehouse, which improves operational efficiency and cus-
tomer satisfaction (Lao et al. 2012). The engine can also be used to select the appropriate MHE
for managing order-picking operations (Poon et al. 2009). In addition, the prediction and optim-
isation of logistics activities based on AI can significantly promote their performance. For
example, DHL has developed a machine learning-based tool to predict delays in air freight transit
time for proactive mitigation (DHL and IBM 2018).
Figure 5. System architecture of smart logistics for the collaborative development of various technologies and advanced
management.
6. Conclusions
This paper systematically and extensively describes the research and applications of IoT-based smart
logistics. Specifically, we reviewed and analyzed the research and applications of IoT in freight trans-
portation, warehousing, and delivery. The key findings and conclusions of the review are as follows:
INTERNATIONAL JOURNAL OF LOGISTICS RESEARCH AND APPLICATIONS 17
. At present, IoT technology applied in logistics is mainly composed of RFID, WSNs, and ZigBee.
RFID makes real-time logistics information traceable, which forms the basic function and feature
of IoT-based smart logistics. WSNs are effective to guarantee safety for goods and trucks in con-
dition and environment monitoring.
. Cold chain logistics, from the perishable food industry, agriculture, and the fishing industry, and
chemical logistics have a high motivation to adopt smart logistics.
. Developed economies and China attach great importance to the study and application of IoT-
based smart logistics. The vast majority of developing countries are short of that.
. The application of IoT can make freight transportation more efficient, visualised, and secure as
well as traceable, but no studies show that IoT can play a role in the transportation network design
and mode selection.
. IoT-based smart warehousing would be more efficient, visualised, and accurate as well as secure.
Besides, the warehousing process would be streamlined, and the warehousing resources would be
optimised. The decentralised decision-making can be achieved with IoT in a centralised WMS.
However, the selection of storage allocation strategy and indoor routing optimisation are still
the challenges for the IoT-based smart warehousing.
. The delivery information is interactive and sharable between delivery service providers and custo-
mers in smart delivery. Delivery would be more controllable, secure, and visualised with IoT. How-
ever, smart delivery relying solely on IoT cannot make it faster and optimise delivery resources.
. The current challenges of IoT-based smart logistics include technical problems of RFID and
WSNs, limited extension and technical capacity of IoT, standardisation issues of IoT, data acqui-
sition and processing issues of IoT, and security and privacy concerns on IoT.
. Some specific problems of IoT-based smart logistics, like vehicle routing problems, truck loading
problems, and storage assignment problems, can be solved through the joint adoption of
advanced ICTs.
. ICTs, such as big data, cloud computing, and AI, efficiently enhance the intelligence of IoT-based
smart logistics and make it a collaborative system. A smart management system integrates differ-
ent logistics components, including smart freight transportation, warehousing, and delivery.
. Research needs for smart logistics include further solving key technical issues of IoT, extending
various IoT technologies applied in logistics, developing IoT, big data, cloud computing, and
AI together to build smart logistics, and adopting advanced management to integrate logistics
systems.
This paper proposes a new working definition of smart logistics and pays more attention to IoT-
based smart logistics. Limited by the article space, the detailed research and applications of other
technologies in logistics have not been analyzed.
Acknowledgments
This research was funded by the Natural Science Foundation of Zhejiang Province (No. LY18G010019). The authors
gratefully acknowledge financial support from the China Scholarship Council.
Disclosure statement
No potential conflict of interest was reported by the author(s).
Funding
This research was funded by the Natural Science Foundation of Zhejiang Province (No. LY18G010019). The authors
gratefully acknowledge financial support from the China Scholarship Council (No. 201808330377).
18 Y. DING ET AL.
ORCID
Yangke Ding http://orcid.org/0000-0002-4072-8077
Mingzhou Jin http://orcid.org/0000-0002-2387-8129
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Appendix