Special Report | Driven by digital technologies and characterized by collaboration and data sharing, the logistics industry’s digital transformation has become an irreversible trend.

Digital Transformation of the Logistics Industry

The logistics industry is entering the “VUCA era,” with rapid digital transformation driven by emerging technologies such as the Internet of Things, artificial intelligence, cloud computing, robotic process automation (RPA), and blockchain. However, China’s logistics sector still faces certain obstacles in adopting these cutting-edge digital solutions. With the recent release of the “Overall Planning for Building Digital China,” the country has accelerated the implementation of key initiatives to advance this national strategy, which will undoubtedly propel innovation and transformation across all industries. Supported by favorable policies, digitalization has become a powerful enabler for the logistics sector’s upgrading and transformation.

How can we overcome the challenges of digital transformation in logistics?

Driven by emerging technologies such as the Internet of Things, artificial intelligence, cloud computing, robotic process automation (RPA), and blockchain, the global logistics industry is undergoing rapid digital transformation. However, the adoption of these cutting-edge digital technologies in China’s logistics sector currently faces several obstacles. According to the Institute of Security Industry at the China Academy of Information and Communications Technology, fostering seamless logistics information flows requires advancing the development of big‑data platforms, promoting “Internet Plus”–based efficient logistics, and accelerating information sharing across multimodal transport systems. Meanwhile, ensuring logistics data security calls for the widespread implementation of China’s digital standards and models for the shipping industry, as well as the establishment of enterprise‑level data security management frameworks.

An arrow released from the bow

Localities have successively introduced a series of incentive measures to guide and support the digital transformation of the logistics sector. For instance, the Guangdong–Hong Kong–Macao Greater Bay Area, benefiting from its financial strengths, has seen governments encourage enterprises to develop compact, efficient, and intelligent logistics equipment, accelerating the digitalization of key logistics assets such as goods, vehicles, and terminals, and driving the smart upgrading and transformation of logistics parks. Meanwhile, industrial clustering is fostering the emergence of smart logistics parks, further speeding up industrial upgrading.

In fact, the growth rate of logistics parks in China is gradually slowing down. Digital technologies are driving traditional logistics parks to upgrade and transform into smart logistics parks.

First, the digital applications of logistics parks are deployed across multiple use cases, encompassing park operations management, the logistics industry, and comprehensive services. By establishing a “smart brain” for the park—namely, an intelligent service management center—and leveraging a data‑driven platform, these solutions integrate cloud computing, GIS², video‑based intelligent analytics, wireless communication, and artificial intelligence to enable seamless interconnection among subsystems. Furthermore, by deploying smart facilities and equipment—including intelligent monitoring systems and integrated logistics systems for sorting and material handling—these initiatives enhance business value, foster ecosystem collaboration, and generate network‑effect benefits. Finally, through the development of a smart connectivity system, the park achieves interconnectedness among people, goods, vehicles, the park itself, and the surrounding city.

Second, as critical nodes in the broader logistics ecosystem, logistics parks are fully leveraging their role in enabling the “Internet of Everything.” Enterprises such as Qingdao Jiaozhou Bay International Logistics Park, Zhangjiagang Jiulong Steel Logistics Park, and Lin’an Logistics Park have already established mature frameworks for building smart parks. Among these, digitalization of operational models serves as the overarching driver, with comprehensive deployment of various digital technologies to integrate park‑wide operational systems, mobilize resources from all stakeholders, and enhance the coordinated utilization of key resources—thereby fostering smart logistics industrial parks that reflect distinct regional characteristics. Leading enterprises are paving the way, with top players in the logistics value chain spearheading the industry’s digital transformation.

Platform tools “bridge gaps,” with digital business collaboration platforms and digital infrastructure service platforms providing indispensable solutions for addressing pain points in the logistics supply chain. Leveraging capabilities such as big data, the Internet of Things, AI, and technology development, these platforms not only help the logistics industry reduce costs, boost efficiency, and improve quality but also empower the digital transformation of logistics and supply chains through data‑driven decision‑making and agile innovation. Moreover, digital infrastructure service platforms can encompass smart device ecosystems, asset‑resource operation platforms, and network freight‑transport and capacity‑ecosystem solutions.

There is resistance.

At present, in China’s end-to-end logistics chain, the sheer number of stakeholders, lengthy cycles, and a lack of robust data support have created an impasse: without seamless information transparency across all three tiers, each link in the logistics process remains fragmented and operates in isolation.

Data from road, rail, waterway, and shipping systems remain difficult to interconnect and share, hindering the development of public logistics information platforms. Although some intermodal transport enterprises in China have digitized their internal intermodal operations, uneven regional development, low levels of information sharing, rigid system architectures, and high information‑acquisition costs for participating stakeholders continue to constrain the planning and construction of logistics information platforms.

In 2019, the world’s top ten container shipping lines—excluding COSCO Shipping—jointly established the DCSA (Digital Container Shipping Association) to standardize the digital transformation of the container shipping industry and pave the way for interoperability and standardization of information technologies, as well as for the adoption of digital applications such as blockchain. However, some companies still exhibit weak awareness of logistics information security and cybersecurity, and data‑security concerns continue to impede the progress of logistics digitization.

With China’s express delivery volume exceeding 100 billion parcels, logistics companies now hold vast amounts of user data, and several data breaches have occurred in recent years. Due to vulnerabilities in system platforms and unclear delineations of responsibilities for data protection, logistics firms have invested insufficiently in data‑protection technologies and human resources, creating significant risks of information‑security gaps and undermining the smooth operation of smart logistics.

Interconnected Sharing

With regard to how to turn the situation around, the author puts forward the following points:

Establish a unified data collection system and access standards, facilitate data integration across the system, and enable data storage, retrieval, and analytical capabilities for business and social‑service information. Promote the connectivity of logistics backbone networks and other supply‑and‑marketing infrastructure to the platform, achieving end-to-end information transparency and intelligent operational control. Build a comprehensive platform that integrates multiple functions, including information matching, logistics services, transaction facilitation, social marketing, brand promotion, and supply‑chain finance.

Accelerate the standardization of multimodal transport and achieve information interconnectivity and sharing:

On the one hand, guided by the principles of government leadership, market-based operations, and multi‑stakeholder participation, a coordination mechanism has been established among departments including highways, aviation, railways, waterway transport, postal services, customs, public security, taxation, and market regulation. A multimodal transport data platform has also been built to ensure seamless information interconnection and sharing among various modes of transport and port‑side regulatory authorities.

On the other hand, policy support at the national level should be strengthened. This includes introducing subsidies and fee‑reduction measures for sea–rail intermodal transport; providing one‑stop services—covering certification and accreditation, qualification requirements, customs clearance and inspection, and credit evaluation—for all stakeholders in multimodal transport; encouraging enterprises across different modes of transport to share resources or restructure assets; and supporting market operators in multimodal transport to form enterprise alliances anchored by logistics chains and intermodal routes. Furthermore, leveraging domestic circulation and the RCEP framework will help accelerate the implementation of China’s digital standards and models in the shipping sector.

Support the development of enterprises’ digital transformation awareness and security management systems. Vigorously promote the importance of establishing a digital logistics management system.

Guide logistics enterprises in building digital security safeguards, and enhance the cybersecurity protection capabilities of critical information systems and key information infrastructure in the transportation sector.

Focus on “Digitalization + Intelligence” to drive cost reduction and efficiency gains in logistics.

In recent years, with the rapid growth of e‑commerce, the logistics and supply chain sectors have been confronted with new challenges. How can they break through the longstanding bottleneck—where traditional industrial park logistics heavily rely on manual labor, resulting in high operating costs, low efficiency, and limited personalization—and achieve end-to-end intelligent transformation? On February 27, reporters learned that logistics companies are partnering with digital cloud‑technology firms to develop an integrated smart management platform called “Shuzhi Men,” enabling end-to-end supply chain visibility and meeting the diverse operational needs of park‑level logistics.

Wang Sheng, CIO of SF Supply Chain, stated that compared with the U.S. or the global average, China’s logistics costs currently account for a relatively high share of GDP. How can costs be reduced and efficiency improved? The answer lies in leveraging technology—through digitalization and automation. Wang Sheng believes that the world has entered the digital era, and the digital‑intelligent transformation of logistics is an inevitable trend. It requires not only analyzing operational and customer data but also integrating AI and other cutting-edge technologies into logistics processes to drive intelligent innovation.

Ye Ming, Director of Industry Business Development for Amazon Web Services China, who co‑developed the “Digital Intelligence Gateway” with SF Supply Chain, stated that both sophisticated coordination capabilities and strategic planning are underpinned by digitalization. Leveraging algorithmic decision‑making, logistics parks can drive innovations in warehouse automation, thereby boosting inventory throughput, cutting transportation costs, and enhancing labor productivity—ultimately reducing fulfillment expenses. “Supply chains are becoming increasingly complex; what was once linear has evolved into a networked structure, and achieving ‘visibility and traceability’ has turned into a significant challenge. Meeting these demands requires new IoT and digital technologies,” Ye Ming emphasized.

In Ye Ming’s view, sustainable development, digital transformation, autonomous driving, and warehouse automation are all key directions for supply chain evolution. Cloud computing has become an essential foundation and a must‑have choice for many enterprises—including supply chain and logistics firms—when designing supply chain and logistics solutions. According to reports, the “Digital Intelligence Gate” solution leverages technologies such as IoT (Internet of Things), data analytics, and artificial intelligence to pursue integrated, modular innovation. By addressing the disconnects between off‑site transportation and intra‑park logistics, it has significantly boosted operational efficiency in logistics parks across multiple sites.

Today, the wave of Chinese enterprises’ internationalization and “going global” is gaining momentum. However, Chinese companies face numerous challenges in areas such as supply chain operations, including: a lack of digital supply-chain platforms that seamlessly integrate manufacturing, procurement, and distribution; and difficulty in effectively responding to disruptions—such as supply shortages or production halts—caused by unpredictable events and environmental factors, which can result in significant losses. SF Supply Chain’s “Digital Intelligence Gateway” not only enhances logistics solutions but also provides supply-chain analytics and early-warning capabilities, helping Chinese enterprises navigate their global expansion with greater confidence.

In an interview, when discussing the digital transformation of Chinese enterprises, Ye Ming noted that migrating to the cloud is becoming the new norm for China’s businesses. As China advances its “Digital China” initiative, cloud computing has given wings to digitalization across countless industries. Nevertheless, the rate of cloud adoption among Chinese companies remains significantly lower than in the United States and the European Union. Consequently, there is substantial room for growth in leveraging cloud computing to drive digital transformation in China. However, the senior executive from a foreign‑owned enterprise acknowledged that the challenges of digital transformation are also mounting, driven by the rapid emergence of new technologies and shifting industry priorities. These factors pose ongoing hurdles that must be addressed. Amazon Web Services, for its part, aims to further empower Chinese companies in their digital transformation journeys.

Perspective

Liu Jing, Vice President of Yiatong Logistics:
The key to breaking through in digital freight lies in technological breakthroughs and value redefinition.

The rapid rise of “Internet Plus” and the digital economy has swept across the globe like a transformative hurricane, permeating every facet of economic activity and driving innovation and transformation across all sectors.

From non‑vessel operating common carriers and online freight platforms to digital logistics, the evolution of digital freight—empowered by cutting‑edge technologies such as the Internet of Things, cloud computing, big data, and artificial intelligence—has fundamentally reshaped the trajectory of the logistics industry and the strategic direction of logistics enterprises.

Driven by the favorable policies supporting online freight, the threshold for obtaining a “ticket” to enter the online freight market is relatively low. However, these platforms place high demands on the comprehensive capabilities of operating enterprises. Companies that were quick to secure their entry and join the competitive fray have gradually lost their first-mover advantage. According to Liu Jing, Vice President of Yiatong Logistics, the key lies in technological breakthroughs and the redefinition of value: whether it’s online freight or digital freight, at its core, both leverage internet and digital technologies to deliver superior logistics services and foster a more robust logistics ecosystem for shippers and carriers, thereby reducing costs and boosting efficiency. Digital technology is the linchpin and an indispensable prerequisite for developing digital freight platforms.

Ensuring that all information for every shipment is traceable and enabling the creation of tangible digital scenarios across diverse business lines is a fundamental measure of a platform’s digital‑technology capabilities.

As the head of Yunda Xing, Liu Jing stated that even before launching the Yunda Xing digital freight platform, he had already positioned digital technology as the core framework for its planning and development. “Digital technology is of paramount importance to the evolution of a digital freight platform, endowing it with exceptional convenience and seamless integration.”

Convenience is a key manifestation of the seamless integration between online and offline operations in digital freight logistics. Digital freight platforms help mitigate structural inefficiencies in information flow, particularly given the inherent complexity of each link in the logistics chain. When unexpected disruptions occur, both shippers and carriers can provide immediate feedback and take timely action, significantly boosting operational efficiency and reducing logistics costs.

Integration refers to how digital technologies have turned digital freight‑transport platforms into bridges for seamless information connectivity. On the one hand, these platforms enable efficient, frictionless data exchange between logistics‑related business information and relevant government agencies, facilitating data collection and upload. On the other hand, they foster end-to-end information sharing across all links in the supply chain, enhancing the capacity of manufacturers, third‑party logistics providers, and end users to exchange and process data. This ultimately supports transparent, real‑time management of the entire freight‑transport process—commonly known as digitally empowering logistics enterprises to reduce costs and boost efficiency.

Accordingly, Liu Jing argues: “The level of development in digital technologies determines both the speed at which digital freight‑transport platforms process information and the breadth of their industry coverage. In today’s rapidly evolving digital economy, only by continuously advancing innovation in digital technologies can a platform sustain its core competitiveness; otherwise, its substitutability will be far too high.”

Openness, collaboration, and sharing are core principles of digital freight platforms, while platform‑based operations underpin the diversity of their offerings. According to Liu Jing, “Only by deploying a comprehensive suite of digital freight ecosystem services can we better meet the needs of businesses and users, deliver end-to-end solutions, and fully leverage the scale advantages of the platform economy, thereby gaining a competitive edge in an increasingly fierce market.”

Regarding the redefinition of value in digital freight‑transport platforms, Liu Jing believes that the value of logistics big data deserves equal attention. “Beyond effectively addressing issues such as information asymmetry in freight transactions and helping the industry reduce costs while boosting efficiency, digital freight also holds significant commercial value in the form of logistics big data. This data can deliver optimized solutions, enable demand forecasting across all stages of the supply chain, and support intelligent logistics decision‑making.”

Digital freight platforms have become a key opportunity for the digital transformation of the logistics sector, a powerful driver of the shift toward digital supply chains, and a robust pillar for building a modern circulation system under the new development paradigm.

Policy-driven digital China development has entered the fast lane.

The “Overall Layout Plan for Building Digital China,” recently issued by the CPC Central Committee and the State Council (hereinafter referred to as the “Plan”), sets forth that by 2025, a unified advancement framework—spanning horizontally across sectors, vertically integrating across levels, and characterized by robust coordination—will be essentially in place, with significant progress made in building Digital China. By 2035, China’s level of digital development will rank among the world’s highest, and major achievements will have been attained in the construction of Digital China.

With the goals set, how will they be implemented? The Plan specifies that the development of Digital China will follow an overarching “2522” framework: consolidating the two foundational pillars of digital infrastructure and a data‑resource system; advancing the deep integration of digital technologies with economic, political, cultural, social, and ecological‑civilization development in a holistic, five‑pronged approach; strengthening the two core capabilities of a digital‑innovation ecosystem and a robust digital‑security framework; and optimizing the domestic and international environments for digital development. Industry experts note that this “2522” framework translates the roadmap for building Digital China into concrete, easily understandable terms, making the Plan’s specific requirements more actionable and helping to accelerate progress on this ambitious initiative.
From the perspective of the “foundation” of Digital China, solidifying the groundwork for its development requires unblocking the major arteries of digital infrastructure. The Plan calls for systematically optimizing the layout of computing‑power infrastructure, fostering efficient complementarity and coordinated interconnection between eastern and western regions, and guiding the rational, tiered deployment of general‑purpose data centers, supercomputing centers, intelligent computing centers, and edge data centers. The Plan also emphasizes comprehensively empowering economic and social development by strengthening, improving, and expanding the digital economy. It seeks to cultivate and scale up core industries of the digital economy, formulate measures to promote high‑quality development of the digital sector, and build internationally competitive digital industry clusters. At the same time, it aims to deepen the integration of digital technologies with the real economy, accelerating the innovation and application of digital technologies in key sectors such as agriculture, manufacturing, finance, education, healthcare, transportation, and energy.

Lin Yifu, Dean of the Institute of New Structural Economics at Peking University, believes that the integrated development of the digital economy and the real economy can accelerate the upgrading of traditional industries and generate greater value. To fully leverage comparative advantages, it is essential to expedite the digital transformation of various sectors, enhance the quality and efficiency of economic growth, and translate development opportunities and growth potential into concrete outcomes and tangible benefits.