Building Robust Supply Chain Software Applications that Fuel Growth in the MENA Region 2023
Supply Chain Management software providers in the MENA region offer valuable solutions to streamline operations, optimize routes, and reduce costs. A number of variables, including the region’s e-commerce expansion, digital transformation, and shifting consumer tastes, are causing the logistics sector to change quickly. These software solutions improve efficiency, offer real-time insights, and guarantee compliance with laws and regulations thanks to cutting-edge technologies like AI, ML, and NLP. Adopting technology-driven supply chain management is essential for companies looking to maintain their competitiveness, enhance customer experiences, and promote sustainable growth in the MENA area.
The UAE’s logistics market was estimated to be worth around 20 billion USD in 2020 and is anticipated to expand at a CAGR of 6.84% from 2022 to 2026. The logistics and supply chain sector has benefited from the region’s strong e-commerce expansion, especially in the post-pandemic economy. Consumer preference is quickly moving away from traditional retailers and toward online shopping. To serve these e-commerce companies, supply chain companies in UAE are quickly growing and upgrading their transportation and distribution operations.
The UAE’s sophisticated technology foundation and high internet adoption offer the potential to improve supply chain management. Route planning systems, driver behavior analytics, and other SCM application solutions like fuel management and vehicle tracking systems can all be used by businesses to improve efficiency and cut costs in transportation operations. By implementing software tools, businesses can optimize routes, improve driver performance, increase visibility, and move toward a sustainable supply chain.
In this regard, a few Supply Chain Management companies in Dubai provide top-of-the-line software solutions to improve the delivery process and make it more customer-friendly. For example, one of Dubai’s most important logistics software providers is Locus. It is a real-world-ready order-to-delivery dispatch management software that aids businesses in resolving their last-mile delivery complications and inefficiencies. With its services, businesses have increased their productivity and expanded across several fulfillment channels.
Locus is a logistics management software with features enabling companies to streamline their dispatch processes. It offers delivery-linked checkout, enabling businesses to schedule deliveries in accordance with consumer-preferred time windows. The route optimization features of the program produce ideal routes, assuring efficient deliveries and enabling drivers and dispatchers to complete jobs on schedule. With its third-party delivery solution, ShipFlex, Locus now enables delivery orchestration and gives cutting-edge analytical insights to address inefficiencies. Zone-based routing reduces vehicle overlap, and its geocoding engine resolves ambiguous addresses. Companies from different geographies, like Unilever, Bukalapak, Nestle, TATA, etc., trust Locus for optimizing their operations.
Transforming Supply Chain Management in MENA Region
In recent years, there have been substantial improvements and changes in the MENA region’s logistics sector. The logistics industry raised impressively more money in the first quarter of 2021 than in the same period last year, increasing by 179%. This expansion can be linked to digital transformation and business model rearrangement, which were motivated by the need for industry agility and competitiveness.
In 2022 McKinsey reported that disruptions in value chains in sectors like the automotive, consumer products, and medicines were caused by demand variability and forecasts. To respond effectively, 32% of professionals in these businesses understand how critical demand forecasting is. Demand planning and forecasting accuracy is increased by combining qualitative and quantitative forecasting with cutting-edge Supply Chain Management software solutions like AI and machine learning.
Changing customer tastes and the demand for effective last-mile delivery and warehousing are driving the digital transformation of the logistics industry. According to a poll, only 5% of supply chain experts have automated order fulfillment procedures. To optimize and automate processes, logistics firms in the MENA area are embracing SCM application solutions, including cloud computing, automatic identification, robots, automation, and predictive analytics.
Micro-fulfillment centers can improve last-mile delivery, which accounts for 41% of supply chain expenses globally. By 2025, the automated micro-fulfillment market is expected to grow to USD 5.3 billion, satisfying the rising need for quicker and more effective delivery. Many businesses are making strides toward improving last-mile delivery. By 2024, Amazon and the Abu Dhabi Investment Office hope to open a state-of-the-art fulfillment facility. The logistics sector in the area has a great deal of potential to change as a result of these efforts.
Building Robust Supply Chain Software Applications for MENA Region
With the boost in logistics and supply chain operations and its increasing share in the region’s economy, the regional governments are attempting to enhance the Supply chain operations. As the region plans to diversify in the non-petrochemical sectors, such as manufacturing, the demand to boost the supply chain is on the rise.
However, the logistics and Supply Chain Management in the MDE region face significant challenges that hinder operational efficiency and growth. This section examines the pressing issues that impact supply chain operations in the region.
Supply Chain Challenges and Solutions in the MENA Region
- Infrastructure Challenges
- In the UAE, road transportation-related challenges, such as traffic congestion, limited infrastructure, and poor connectivity, pose hurdles to efficient supply chain operations. The growing population and expatriate influx worsen congestion, causing delays and reduced productivity. Inadequate transportation networks and poor road conditions further contribute to delays and increased costs.
- Implementing a comprehensive SCM solution can optimize route planning, leverage real-time traffic data to reduce the effects of congestion, and enhance overall supply chain effectiveness. Businesses can minimize transportation delays, increase operational efficiency, and make informed decisions using cutting-edge algorithms and predictive analytics, leading to cost savings and higher customer satisfaction.
- Further streamlining operations and reducing the hazards related to traffic congestion and inexperienced drivers can be accomplished by integrating SCM software with driver behaviour analytics and vehicle tracking technologies.
- Changing Fuel Prices
- Changes in worldwide gasoline prices significantly impact the operational costs in the UAE’s transportation industry. Despite being an exporter of gas and oil, the UAE sees its fuel costs fluctuate depending on global standards. Fuel costs in the UAE have increased by more than 74% since January 2022, peaking in July 2022 at 4.76 AED or 103.58 INR per liter. Such abrupt pricing changes interfere with supply chain expenses and impair long-term planning.
- Telematics technology is one of the finest supply chain management strategies to lower fuel prices and usage. It enables fleet managers to use GPS tracking to optimize real-time routes while considering weather and traffic variables to save fuel consumption and driving time.
- Telematics also makes it possible to monitor driver behavior, including excessive speed and provides prompt alerts for better fuel management. It also assists in locating and addressing engine idling, a key cause of fuel waste. Implementing some of the best Supply Chain Management solutions, like Telematics, aids in preventing fuel theft and offers actionable data for effective fuel utilization.
- Customs and Regulatory Compliance
- Due to complex and uneven regulatory frameworks and customs procedures, supply chain management in the MENA region is complex. Customs clearance procedures, documentation requirements, and import/export restrictions that differ might result in delays and bottlenecks.
- For the supply chain to run smoothly, compliance with these intricate and varied customs and regulatory regulations is essential. To overcome these obstacles, efficient coordination, knowledge of local laws, and proactive steps to simplify customs procedures and guarantee compliance across the supply chain are needed.
- A Supply chain software development company like Tntra provides innovative software engineering services, which are supported by blockchain, AI, ML, and NLP technologies. With their knowledge, these businesses may provide specialized solutions to improve coordination, accelerate the customs process, and guarantee compliance.
- For companies operating in the Middle East and North Africa (MENA) territory, their software can automate documentation, offer real-time regulatory insights, and optimise customs clearance. This cuts down on lead times and boosts supply chain effectiveness.
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While switching from traditional supply chain management to an integrated, digitised strategy may have some upfront expenses, its numerous advantages can significantly improve business sustainability and profitability, which is essential in today’s market. Because of this, companies in the MENA area should put aside their reservations and embrace technology integration in their supply chain operations, especially in nations like the UAE with developed infrastructure suitable for technological improvements.
Businesses in the MENA region that deliver orders or strive for great customer experiences must carefully choose their Supply Chain Management (SCM) software. Businesses may streamline last-mile delivery operations and increase value for the logistics team and customers by investing in top SCM software vendors. These options provide effective route planning, real-time tracking, streamlined warehouse management, and greater communication, all of which improve operational effectiveness, reduce costs, and satisfy customers. A critical approach for MENA organizations looking to maintain their competitiveness and meet the changing market needs is to embrace technology-driven SCM.
When your organization is involved in delivering orders and wants to create a good impression on the customers, choosing the correct Supply Chain Management software providers is important!
Contact Tntra today for more information about how our SCM solutions can help your business in the MENA region.