James Middleton
07.09.2022

on demand logistics, dynamic supply chain

Logistics tech specialist Value Chain Lab (VCL), supported by the University of Cambridge’s Manufacturing Analytics Group, has been awarded an Innovate UK grant to further industrialise its Web3.0 platform, with the potential to truly challenge the status-quo of the logistics services market and maximise benefit potential with 20% cost and 25% emissions savings targeted.

The research project, currently known as ‘FLOX-II’, is a game-changing concept aimed at disrupting the road freight market, including urban distribution, with a collaboration solution that will unlock major logistics cost savings and deliver substantial contributions to the challenges of climate change, traffic congestion and urban air quality.

The award of the grant to continue the research follows the completion of VCL’s Feasibility Study IUK-47389, which successfully proved the potential and technical feasibility of building a platform capable of addressing the above problems.

In VCL’s proposed approach to a multi-agent software architecture, fast load matching and capacity allocation optimisation for highly granular route planning, early prototypes demonstrated 16% empty mileage and 20% cost savings.

“The logistics market is confronted with immense operational, Environmental and, Social challenges. For decades the sector has been plagued by razor-thin margins with problems magnified by driver shortages, Brexit, the global pandemic and geopolitical events. Moreover, customer expectations are evolving rapidly and businesses need more agile and cost effective solutions for highly volatile flows,” said Michael Ostroumov, CEO of VCL.

“In the UK, freight capacity is significantly underutilised leading to higher costs, environmental damage and congestion - 63% of journeys have an average load utilisation of less than 60% by weight or volume. Freight collaboration is proven to deliver substantial economic benefits, contributions to societal challenges of climate change, safety, reduced traffic congestion and improved urban air quality,” Ostroumov added.

VCL’s findings have established that existing approaches can’t effectively solve two problems: 1) algorithmic complexity of dynamic vehicle-routing and load-planning across logistics networks; 2) lack of operational trust and incentive for route-schedule adherence among transactional collaborators.

The FLOX-II project is engaging a group of industry partners who will provide input on the best ways to address practical operations challenges as well as involve leading market expertise to address trust and usability, two critical adoption barriers identified in the feasibility study.

Development of a prototype ready for live trials demands industrial research and development of advanced AI-enhanced hybrid architecture, optimisation algorithms and equitable gain-sharing mechanisms that will address day-to-day operational, security and incentives challenges.

Supported by world-leading expertise from Cambridge University’s Manufacturing Analytics Research Group (MAG), VCL will focus on enabling:

order book matching against spatial freight availability in real-time through a fast and scalable architecture;

incentivise collaboration through algorithm-defined gain capture and equitable allocation;

continuously adapting load optimisation and routing decision-making aided by AI-augmented reinforcement-learning algorithms to maximise collaboration gains.

The FLOX-II project will conclude with a three-month pilot of the platform’s Beta version which is designed to validate identified use cases and operational requirements as well as confirm tangible benefit delivery and equitable gain sharing approach with all participating stakeholders.

As part of the project, VCL are looking to work with stakeholders across the supply chain including manufacturers, retailers, logistics providers and government organisations. If you’d like to find out more about the project and see how you can be part of an industry changing project, please email flox@stowga.com

About VCL

Based in London, Value Chain Lab (VCL) is the parent company of Stowga, the largest On-Demand Warehousing Marketplace servicing the UK and global markets. Its clients include 3PLs (Third Party Logistics), industrial property owners, and partners with vacant space within existing commercial warehouses.