Limitless opportunities for logistics

Sweeping opportunities for logistics

The world is growing closer and closer together. Political and ideological borders are disappearing. Trade barriers are being dismantled and customs duties are being eliminated. At the same time, innovative information and communication technologies are creating new, far-reaching possibilities. As a result of this dynamic development, the demand for logistics services is climbing enormously. Logistics has become a critical factor in the success of modern companies because customer and supply networks can be extended around the world. At the same time, though, intensifying global competition is developing. The result: Globalization is creating new challenges to go along with its sweeping opportunities.

The new opportunities of globalization

In the past 20 years, the conditions for global trade and business have improved tremendously. Many political, ideological and customs-related borders between countries and regions of the world have been dismantled.
The “Iron Curtain” fell and the socialist economic order collapsed while the integration of Europe continued to advance. Similar developments have occurred in other regions, including South America (MERCOSUR), North America (NAFTA) and the Pacific region (ASEAN).
In addition, worldwide efforts to remove trade barriers are progressing slowly but surely. These include the Global Agreement on Tariffs and Trade (GATT) and the Organization for Economic Cooperation and Development Organization for Economic Cooperation and Development (OECD).
A driving force of these improvements has been the enormous advances made in information and communications technology since the 1990s. This development is the result of both the World Wide Web and globally accepted, factual standards, including Windows-based PC systems, the EDIFACT EDIFACT , EAN EAN coding and, last but not least, English as the world language of business.
The standards help business partners to be located more quickly and cost effectively, and make the processes used in the everyday business world considerably more efficient than it was in the 1980s. These strides have been complemented by progressive standardization in packaging and containers led by the International Standards Organization (ISO).
For industrial and trade companies, the possibility of extending the networks of their suppliers and customers farther and farther internationally has become much more appealing. After all, they can search for materials, employees, know-how and the conditions for their activities in countries and regions that offer them the best cost-performance ratio.
Customs regulations and document processing have been greatly simplified. Communications and transport options have become significantly faster, more cost effective and more reliable. The lower transport costs arising from these changes are the reason that more and more companies are deciding to extend their value-creation processes around the world.

New challenges of globalization

Globalization is not just a world of new opportunities for companies. It also poses certain risks.
In many sectors, more intense, global commercial competition has arisen. Even in their home markets, companies are facing new competitors from around the world, and these competitors frequently enjoy massive cost advantages generated by such factors as lower production expenses.
As a result of this development, the demand for transport, storage, transshipping, communications, planning and control services is continuously growing. At the same time, pressure to optimize the quality and costs of services is growing on companies. Logistics has become one of the most important levers that companies can use to survive and succeed in global competition.

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