APIs and Logistics: How APIs Are Changing the Face of the Logistics Industry

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Companies of all sizes and industries are unlocking new possibilities thanks to APIs (application programming interfaces). There are many common uses of APIs, from driving business agility to improving the customer experience. However, there are few sectors where APIs have so much potential as the logistics industry. From giant e-commerce retailers like Amazon to small mom-and-pop businesses, shippers, couriers, and delivery services can all benefit from using a logistics API. In this article, we’ll discuss the various applications of APIs for logistics operations and your supply chain.

What Is an API?

An API (application programming interface) is a software connector between two third-party systems or applications, allowing them to easily communicate with each other in real time and bringing them into the same ecosystem. API integration is fundamental to our modern world of digitization: It powers everything from flight booking websites to online payment portals.

The two main types of APIs used today are REST and SOAP, replacing older alternatives such as Electronic Data Interchange (EDI). REST (Representational State Transfer) APIs use a stateless client-server architecture and send data in JSON or XML format, while SOAP APIs typically use the HTTP protocol and send data in XML format. APIs are also classified into public or private based on the people who are allowed to use them (i.e. the general public or only a restricted audience).

APIs for Logistics Providers

With all that said, how can APIs benefit logistics and supply chain companies in particular? Below, we’ll discuss various ways how APIs track logistics throughout the global supply chain, from trucking to warehousing.

1. Shipping API

A shipping API helps e-commerce brands integrate shipping functionality into their website. Shipping APIs may come with a wide range of features, including:

  • Label generation: Shipping APIs use automation to instantly create a label for each order placed on an e-commerce website. This helps dramatically streamline the order fulfillment process.
  • Address validation: Once the buyer inputs an address, the shipping API takes that address and verifies that it matches a real-world location. The API can also clean up the address based on defined format requirements (e.g. shortening “Drive” to “Dr'“).
  • Multi-carrier support: E-commerce customers appreciate having a variety of shipping alternatives based on speed and cost. (One study found that the biggest reason for cart abandonment is high shipping expenses.) Using a shipping API allows buyers to see the pricing for different carriers, giving them full visibility into their options.
  • Shipment tracking: 24% of customers say that they are more likely to return to an e-commerce website that offers shipment tracking. Shipping APIs allow buyers to get real-time updates about the status of their order via a website, mobile app, text message, or email.
  • Proof of delivery: Once the shipment has been delivered, shipping APIs allow the e-commerce seller to view a proof of delivery (such as the customer’s signature). This confirmation helps reduce the risk of fraudulent claims of missing or defective packages.

Looking to build a shipping API for your own business? Get started in minutes with a 14-day trial of the DreamFactory API management platform.

2. Logistics API

A logistics API helps with the coordination and optimization of your supply chain and logistics operations. The various functions of your logistics API may include:

  • Transportation management system (TMS): A transportation management system is a logistics platform that oversees the movement of goods from one location to another, both incoming and outgoing. Manufacturers, distributors, and retail businesses all rely on TMS software to coordinate the shipment of physical products. Logistics APIs can interface with your TMS, extracting the data you need to effectively conduct your business. The features of a logistics API relevant for a TMS may include sending freight quote requests, tracking and dispatching shipments, and automatic billing and auditing services.
  • Warehouse management system (WMS): A warehouse management system is a software platform that allows users to administer their warehousing, inventory, and fulfillment processes. The use of WMS software is essential for large businesses to efficiently monitor product levels and restock products before they are depleted. Logistics APIs can communicate with your WMS software, connecting it with your e-commerce website or retail outlet, so that you always have the latest information about product stock levels. This is essential to offering a high-quality customer experience: 30% of customers say that having items out of stock negatively impacts their opinion of the retailer, and 70% will go to another store after seeing multiple items out of stock.
  • Third-party software: Logistics APIs often interface with third-party software applications, such as an ERP (enterprise resource planning) system or CRM (customer relationship management) software. The information from these third-party platforms can help enrich your logistics workflows, helping you plan your business operations and manage your customer relationships better.

DreamFactory: APIs for Logistics Companies

From shipping to warehouse management, API technology offers the possibility to radically transform the face of the supply chain management and logistics industry. The only question left is: How can logistics companies actually begin to bring APIs into their operations?

The answer lies with dedicated API management solutions such as DreamFactory. The DreamFactory platform makes it easy to create and manage production-ready REST APIs in a matter of minutes. DreamFactory comes packed with features and functionality: a low-code, user-friendly interface; converting SOAP APIs to REST; a rich array of integrations with databases and data sources; ironclad security; and much more.

Want to see the power of DreamFactory for yourself? Start a 14-day free trial today to see just how easy it is to build your own APIs.

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