Jun 23, 2022 3 Min READ

What Is the IoT (Internet of Things)?

Ashley Hawkins

Ashley Hawkins has over 5 years of experience in applied mathematics, previously working as an editor and copywriter in engineering and tech. She now works as a Content Marketing Specialist at Extensiv where she writes content on industry trends and best practices. With experience in research and consulting on software workflows, Ashley is passionate about the future of technology and logistics.

3 Min READ
What Is the IoT (Internet of Things)?


Imagine: You just got home from a (very) long day at work and are feeling exhausted to the point that searching for your keys in your purse might put you over the edge. No matter, you can unlock your front door with an app on your phone. Before you even made your evening commute home from the office, you made sure to set the thermostat at home—again with an app on your smartphone—to a chilly 70 degrees since summer is in full swing, and the cool hum of the air conditioning unit welcomes you home. You walk through the front door and ask your cloud-based virtual assistant to turn on the lights and play your favorite song; it is officially time to unwind.

The Internet of Things has become a regular part of our existence with smart homes becoming increasingly popular and the ubiquity of cloud-based voice assistants like Amazon Alexa and Google Assistant. But you may still wonder, what exactly is the Internet of Things, and what does it have to do with warehousing?

IoT Defined

IoT, or the Internet of Things, refers to a physical network of "things" that connect through the internet to collect and exchange data with other devices and systems. These "things"—colloquially called smart devices—are equipped with sensors, software, and other technologies that upgrade them from normal versions of the same devices (think the front door lock in the example above).

There are three basic components that make a device part of the IoT: sensors, internet connectivity, and processors for computing power. Many IoT devices are controlled through apps on a smartphone or tablet, but other IoT devices can detect and monitor their environment to act on the status information they receive without any user input, especially devices used to regulate environments—temperature, humidity, etc.— like thermostats.

IoT in Warehousing

Third-party logistics (3PL) warehouses that specialize in cold storage or other verticals that require regulating the warehouse environment to keep temperature and humidity levels stable can clearly benefit from the IoT thermostats and sensors mentioned above. But the IoT is diverse and expansive, capable of helping all warehouses with their operations outside of these specialized verticals.

Thermostats and sensors, robots, drones, and even radiofrequency identification (RFID) are all part of the warehouse IoT ecosystem. As such, IoT technologies can help with everything from improving automation in the warehouse to inventory tracking and maintenance of warehouse equipment.

While robots and drones are fancy and exciting, a more practical starting point for adopting IoT is managing inventory with RFID tags and mobile barcode scanning technologies.

Inventory Management with IoT

When placed at the entrances and exits of the warehouse, RFID tags assist with inventory tracking by notifying warehouse operators when goods come into or leave the warehouse. An RFID tag is basically a glorified barcode that holds more data on inventory and that does not need to be scanned with line of sight.

Instead, the system can scan RFID barcodes all at once and in real-time, automatically, from a distance. This way, employees picking items do not need to scan each individual item, and large pallets can be scanned as a whole instead of by individual items. Additionally, RFID tags can keep track of expiration dates, warehouse location of the item tagged, and more.

RFID tagging is the next evolution from barcode scanning, but it's expensive and not standardized across the industry. Since data can differ between RFID manufacturers, it may not sync properly, so RFID tags may not be appropriate for all warehouses.

Traditional mobile barcode scanning is a sub-sect of the IoT with scanners that connect directly to the internet instead of a computer. Other scanning technology (e.g., pick-to-light, put-to-light, and vision picking with wearable smart glasses) also falls under the IoT umbrella to aid inventory picking with lights and sensors that replace outdated paper pick sheets. All these picking technologies directly communicate with your 3PL’s warehouse management system (WMS) software to automatically record data on inventory levels and locations once workers have picked items.

Benefits of IoT

The main benefits of IoT are the reduction of errors, increased visibility over warehouse operations, and enhanced predictive analysis from precise data collection. RFID tags in particular reduce errors in receiving, order fulfillment, other inventory management, and shipping as the IoT devices automatically transmit data to the WMS. This automatic and immediate data transfer allows warehouse operators to open their WMS and know inventory levels and conditions in real-time as well as to forecast demand and order inventory accordingly.

Warehouses are essential hubs in the supply chain, and IoT can help with transparency and efficiency in operations—something all 3PLs are always looking to improve. Consider implementing IoT to pair with your WMS today!

To learn more about industry trends, subscribe to our blog.


Latest Insights

Feb 02, 2023 5 Min READ

To paraphrase one of the world’s most successful investors, “Revenue is good, but cash is king!”

Jan 31, 2023 2 Min READ

As businesses continue to expand and globalize, the need for effective logistics management across multiple distribution centers becomes increasingly important. One solution that has gained [...]

Jan 26, 2023 3 Min READ

In today's fast-paced, competitive ecommerce landscape, having a flexible fulfillment network is crucial for meeting the needs and expectations of customers. A flexible fulfillment network allows [...]