Opportunity, Innovation, and Entrepreneurship in Logistics and Transportation Sector

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Opportunity, Innovation, and Entrepreneurship
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Introduction
Making prediction concerning the future development directions is gaining concern.
Nonetheless, making a forecast of the forthcoming events as well as the development directions
is becoming elusive since the prediction’s certainty is minimal. Regardless, there are several
studies that focus on the analysis of the future trends using different techniques. Future research
concerns itself with making forecasts of the future states of a long spanning and essential events
as well as the phenomena and its consequence. Future trends have a huge effect on the global as
well as the national economies. These trends will result to technological as well as structural
changes among business sectors with the service industry included.
This report is based on the logistics and transportation sector, focusing at designing of a
last-mile fulfillment strategy and hub services to assist capture opportunities that are presented at
the intersection between urbanization and e-commerce in the long-run (de Sousa and Mendes-
Moreira, 2015, pp.90). According to Jens, Hady and Dorota (2016), there is the possibility of the
transportation and logistics industry being significantly altered by many megatrends in the years
to come. These megatrends are reshaping this business environment. As the megatrends continue
to reshape the transportation and logistics industry, most of the leading players will be in a
position to capture the business opportunities presented by decisively reacting faster compared to
their rivals (Dekker, Bloemhof, and Mallidis, 2012, pp.678). The most successful organizations
will begin to prepare for these likely changes as early as now.
Some of the megatrends that are related to the transportation and logistics sector include
urbanization, e-commerce, sustainability, as well as infrastructure congestion and scarcity

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(Kersten, von See and Skirde, 2014, pp.17). This report thus will focus on creating an
understanding of the changing business environment.
Relation to Literature
Urbanization
Due to the continuing migration of individuals from the rural areas to the urban centers,
several megacities are observed to be continuously evolving and creating new demand patterns
among the consumers who directly have on influence on the logistic players (Kunze, 2016,
pp.288). Cities have been observed to be the manifestation of the cultural, the economic, as well
as social acceleration experienced by individuals in the modern industry. According to Markku
(2012) in the year 1950, almost 2/3 of the global population resided in rural settlements while the
remaining settled in the urban areas. However, he notes that by the year 2050, a reverse of the
population will be observed globally, with more than 6 billion individuals residing in the messy
as well as the burgeoning urban areas (Pfohl, Ehrenhöfer and Zuber, 2013, pp.87). A study
conducted by the Sustainable Urbanization Policy Brief reveals that currently, the urban centers
are occupied with not more than 5% of the global landmass. The urban centers have undergone
massive global infrastructural and technological innovations. Urbanization has made it necessary
for urban planning decisions as well as strategic design to facilitate equity, world
competitiveness, energy-efficiency, as well as mobility patterns. It is observed that with a decline
in the density, the city areas are observed to grow faster compared to the city population. This
has an effect on the environmental sustainability (Prentkovskis, Junevičius and Skačkauskas,
2017, pp.431). The manner in which industries manage these uncertain urban growths in the
years to come will determine the likelihood of their sustainable endeavors. This shows the reason

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as to why there is need for transport and logistics sector to address the enhanced city complexity
resulting from urbanization.
E-commerce
E-commerce entails the buying and selling of goods and services by firms as well as
customers via the internet. In this era of World Wide Web, the rise of e-commerce has resulted in
some multi-story shopping centers closing. The online retail boom has been facilitated by
technology which has had benefits on some retailers (Sabadka, 2015, pp.17). Adoption of
smartphones and tablets has facilitated the e-commerce’s shift from an untested frontier that has
developed to become a retail industry’s retail industry. According to Ozan (2015), Europe is for
example expected to have a 12% growth rate in e-commerce by end of 2018. Due to these
developments and continuous growth in e-commerce, it has as well become a changing factor
that is reshaping the global transportation and logistics sector. Transportation is viewed as a
primary piece to the success of any retail business. The role of this sector is expected to become
even greater as e-commerce continues to take shape in the retail industry. The reason is that
having an efficient supply chain facilitates high service level to be availed across all the
channels. As a result of e-commerce, there is an inevitable market shakeout that awaits the
transportation and logistics sector (Savelsbergh and Van Woensel, 2016, pp.581). The e-
commerce products that require being transported keep on increasing on a daily basis. This has
resulted in spurring new concepts and ideas within transportation and logistics sector such as the
development of a last-mile fulfillment strategy.
Infrastructure Congestion and Scarcity