A growing number of companies are paying to track in real time everything from truckloads of pork chops to shipping containers full of exercise equipment.
Logistics providers, retailers and suppliers are inking deals with software firms that use location data and weather and traffic information to monitor shipments and alert customers to events that could hold up delivery, such as a loaded truck sitting in a yard for more than an hour.
This month, supply-chain software firm Descartes Systems Group bought MacroPoint LLC, which provides location-based truck tracking, for $107 million. Descartes already tracks ocean, air and parcel delivery for customers such as Home Depot Inc. and CVS Health Corp., as well as some trucking. Other “visibility” startups are broadening their scope, adding services like real-time temperature tracking.
The need for these services is growing as retailers and shoppers demand faster, more-precise delivery. Many Amazon.com Inc. customers have become accustomed to reliable two-day shipping, forcing other retailers to offer similar service. Businesses are making new demands of their suppliers as they trim inventories and reduce supply-chain costs. Wal-Mart Stores Inc. in July said it would penalize companies that made deliveries too late or too early.
“It’s the Amazon effect — customers are putting more pressure on their supplier to know where their product is,” said Bart De Muynck, a supply chain analyst with Gartner Inc. Mr. De Muynck said he expects more tracking startups to get snapped up by larger software companies.