LogTechs in Brazil

FUNDAÇÃO GETULIO VARGAS
ESCOLA DE ADMINISTRAÇÃO DE EMPRESAS DE SÃO PAULO
NATALIA MARÍA OJEDA LARROSA
LOGTECHS IN BRAZIL: HOW LOGISTICS START-UPS ARE APPLYING
INDUSTRY 4.0 TECHNOLOGIES. A MULTI-CASE STUDY
SÃO PAULO
2021
Thesis presented to Escola de Administração

de Empresas de São Paulo of Fundação
Getulio Vargas, as a requirement to obtain
the title of Master in International
Management (MPGI).
Knowledge field: Internationalization of

Companies
Adviser: Prof. Dr. André Cherubini Alves
SÃO PAULO
2021
Ojeda Larrosa, Natalia María.
LogTechs in Brazil : how logistics start-ups are applying Industry 4.0 technologies: a
multi-case study / Natalia María Ojeda Larrosa. - 2021.
104f.
Orientador: André Cherubini Alves.

Dissertação (mestrado profissional MPGI) – Fundação Getulio Vargas, Escola de
Administração de Empresas de São Paulo.
1. Empresas novas. 2. Logística empresarial. 3. Inovações tecnológicas. 4.

Tecnologia e civilização. I. Alves, André Cherubini. II. Dissertação (mestrado
profissional MPGI) – Escola de Administração de Empresas de São Paulo. III.
Fundação Getulio Vargas. IV. Título.
CDU 658.86/.87::62
Ficha Catalográfica elaborada por: Isabele Oliveira dos Santos Garcia CRB SP-010191/O
Biblioteca Karl A. Boedecker da Fundação Getulio Vargas - SP
Thesis presented to Escola de Administração

de Empresas de São Paulo of Fundação
Getulio Vargas, as a requirement to obtain
the title of Master in International
Management (MPGI).
Knowledge field: Internationalization of
Companies
Approval Date:
14/12/2021
Committee Members:
_________________________
Prof. Dr. André Cherubini Alves
(FGV/EAESP)
_________________________
Prof. Dr. Pedro Tonhozi de Oliveira
(FGV/EAESP)
_________________________
Prof. Dr. Fernanda Maciel Reichert
(PPGA/UFRS)
Acknowledgements
I would like to express my gratitude to my advisor Prof. Dr. André Cherubini Alves for
all his support throughout this process. I thank my family for the encouragement and support to
continue advancing towards my goals. My thanks to the interviewees who actively collaborated
by sharing their experiences and outlooks. And finally, to all the FGV professors, colleagues and
friends.
Abstract
Purpose – This research aims to explore the Industry 4.0 technologies that are being adopted by
logistics start-ups in Brazil, which are also called LogTechs.
Design/methodology/approach – It is qualitative research, analyzed through case studies. To
collect the empirical data, interviews were carried out with the founders or representatives of the
start-ups. A multi-case study enables the exploration of the different existing tools to optimize
logistics operations and the analysis of specific cases that are successful in Brazil.
Findings – The research provides meaningful insights about Industry 4.0 tools to optimize
logistics processes and how LogTechs companies in Brazil apply them. Also, describes the
challenges faced by Logtechs in Brazil.
Originality/value – Beyond explaining the uses and benefits of logistics 4.0 technologies, they
are analyzed in successful cases of Brazilian Logtech companies.
Keywords – Industry 4.0, Logistics 4.0, Logtechs.

Resumo
Objetivo - O objetivo desta pesquisa é explorar as tecnologias da Indústria 4.0 que estão sendo
adotadas por startups de logística no Brasil, também chamadas de LogTechs.
Desenho / metodologia / abordagem - É uma pesquisa qualitativa, analisada por meio de
estudos de caso. Para coletar os dados empíricos, foram realizadas entrevistas com os fundadores
ou representantes das start-ups. Um estudo multi-caso permite a exploração das diferentes
ferramentas existentes para otimizar as operações logísticas e a análise de casos específicos de
sucesso no Brasil.
Resultados - A pesquisa fornece insights significativos sobre as ferramentas da Indústria 4.0
para otimizar os processos de logística e como as empresas LogTechs no Brasil as estão
aplicando. Além disso, descreve os desafios enfrentados pela Logtechs no Brasil.
Originalidade / valor - Além de explicar os usos e benefícios das tecnologias de logística 4.0,
são analisados em casos de sucesso de empresas Logtech brasileiras.
Palavras-chave - Indústria 4.0, Logística 4.0, Logtechs.

Table of Contents
Acknowledgements 5
Abstract 6
Resumo 7
Table of Contents 8
List of Figures 14
List of Tables 15
Introduction 16
Aims and Objectives 18
Research interest 18
Research objective 18
Research questions 18
Gap 18
Literature Review 20
Industry 4.0. 20
Innovation cycles 20
Industry 4.0 definitions 21
Industry evolution path 22
First industry revolution 23
Second industry revolution 23
Third industry revolution 24

Fourth industry revolution 24
Industry 4.0 technologies 25
3D printing 26
Artificial Intelligence (AI) 27
Big data analytics 28
Blockchain 29
Internet of Things (IoT) 30
Machine Learning 31
Robotic systems 31
Principles and fundamental of Industry 4.0 31
Logistics 4.0 32
Logistics definition 32
Logistics in Brazil 33
Logistics 4.0 development path 34
Logistics 1.0 34
Logistics 2.0 35
Logistics 3.0 36
Logistics 4.0 37
Advantages and disadvantages of Logistics 4.0 39
Logistics 4.0 common applications 40

Logistics 4.0 in global companies 41
Technological impact on logistics 44
Logistics 4.0 evaluation model 46
Start-ups 47
Start-ups classifications 48
The role of startups in the economy and development 50
LogTechs 52
Definition 52
LogTechs worldwide 53
Cloud Trucks 53
Hive 53
SILQ 53
LogTechs in Brazil 54
Covid impact on LogTechs 57
Challenges LogTechs face 59
The role of incubators and accelerators 59
Methodology 61
Research Design 61
Data collection 62
Multi-case study 62
Sample 63
Interviews 65
Results 67
LogTech A – WMS platform 67
Management 67
Concept of the company 67
Innovation management 69
Next steps 69
Opportunities 69
Challenges 70
Material flow 70
Industry 4.0 technologies applied to manage products and materials 70
Benefits and results 71
Information flow 71
Industry 4.0 technologies applied to manage information 71
LogTech B – Beer industry logistics management 73
Management 73
Next steps 76
Opportunities 77
Challenges 77
Material flow 77
Information flow 79
LogTech C – International trade business intelligence platform 80
Management 80
Next steps 82
Opportunities 82
Challenges 84
Material flow 85
Information flow 86
Interviewed LogTechs logistics 4.0 dimensions 88
Challenges faced by interviewed LogTechs 90
Industry 4.0 technologies adopted by interviewed LogTechs 91
Discussion 92
Conclusions 95
References 97
List of Figures
Figure 1. Waves of Innovation ......................................................................................... 20
Figure 2. Industry 4.0 technologies .................................................................................. 25
Figure 3. Industry 4.0 enabling technologies ................................................................... 26
Figure 4. Industry 4.0 in Logistics ................................................................................... 37
Figure 5. Some typical solutions of Logistics 4.0 ............................................................ 39
Figure 6. Advantages and disadvantages of Logistics 4.0. .............................................. 40
Figure 7. Fourth Industrial Revolution impact on manufacturing, logistics services and
retail .............................................................................................................................................. 44
Figure 8. Expected impact of digital transformation on the cost situation in companies 45
Figure 9. Digitalizing business models by sector ............................................................ 46
Figure 10. Logistics 4.0 dimensions ................................................................................ 47
Figure 11. Nomenclature and classification of Startups according to the Target Public . 48
Figure 12. Nomenclature and classification of Startups according to the Income Model 49
Figure 13. Nomenclature and classification of Startups according to the Stage. ............. 49
Figure 14.The Global Startup Ecosystem Ranking 2021 ................................................. 51
Figure 15. Share of top global ecosystems by continent.................................................. 51
Figure 16. Exponential growth in the last five years ....................................................... 55
Figure 17. 283 Brazilian LogTechs.................................................................................. 56
Figure 18. Summary of How Covid-19 has impacted entrepreneurship globally ........... 58
List of Tables
Table 1. Companies and interviewees .............................................................................. 65
Table 2. Interviews guidelines for evaluation .................................................................. 66
Table 3. Interviewed LogTechs logistics 4.0 dimensions ................................................ 88
Table 4. Challenges faced by interviewed LogTechs ...................................................... 90
Table 5. Industry 4.0 technologies adopted by interviewed LogTechs ............................ 91

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Introduction
The industry went through several waves of significant innovation, which drastically
changed operations. The most recent wave of innovation is the so-called Industry 4.0 that
brought the "smart" concept to many operations through technologies such as the Internet of
Things, Big Data, RFDI, Cloud computing, augmented reality, robotics, and others. Mc Dougall
(2014) defines it as “the technological evolution from embedded systems to cyber-physical
systems. It connects embedded system production technologies and smart production processes
to pave the way to a new technological age which will radically transform industry and
production value chains and business models”.
Logistics was no exception. The impact on logistics was even so significant that the term
Logistics 4.0 began to be used. This is how solutions emerged, such as autonomous vehicles,
traceability of containers and assets, Blockchain, augmented reality for warehouse management,
big data, and machine learning to predict scenarios. These technologies are achieving efficiency
levels much higher than those previously obtained.
In Brazil, the larger logistics companies adopted them, always staying at the forefront.
Nevertheless, there is also the sector of a large number of start-ups that are emerging seeking to
take advantage of these technologies combined with innovative management ideas. These start-
ups are gaining space in the market and are known as LogTechs.
Their presence in Brazil is increasing and the solutions they offer are of great added
value. Most of the research covers Industry 4.0, however the materials related to logistics 4.0 are
less. Even less when we refer to start-ups that offer logistics solutions 4.0.
The question that arose were which of these Industry 4.0 technologies are being exploited
by Brazilian LogTechs and what are the challenges they face.

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In recent times, the Covid-19 pandemic has undoubtedly represented a great challenge for
various sectors, and significantly for startups, that are usually in the growth phase and still do not
have the necessary stability to face successfully changes of this magnitude. In addition, other
challenges were described and compared between the three developed cases.
Logistics in Brazil are complex due to the extension of the territory, the lack of adequate
infrastructure. The implementation technologies offered by LogTechs, have the potential to reach
from small to large-sized companies, and be very beneficial to improve logistics performance at
extensive reach.
To better understand the technologies offered, and the LogTechs operations, a multi-case
study was carried out. It allowed internalizing the value propositions of each one, growth
opportunities, and challenges they face in order to make a comparison that generated valuable
insights.
To access empirical information and thus develop the multi-case study, interviews were
conducted with LogTechs founders or representatives.
In order to analyze the results obtained, the Logistics 4.0 dimensions model from
Oleskow-Szlapka and Stachowiak (2019) was used, breaking down the results in three main
areas: management, material flow and information flow.
In this opportunity, the objective was to delve into three specific LogTechs operations to
obtain specific and practical details. However, it would be of great value for future investigations
to do a larger-scale analysis with quantitative data.

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Aims and Objectives
Research interest
Logistics represents great challenges in Brazil considering the precarious road
infrastructure, high costs, and technological delay. Therefore, the engagement of logistics
services providers towards technology and innovation is key to fostering development and
competitiveness. Nowadays, Industry 4.0 tools are on the rise, and LogTech companies are
gaining space in the Brazilian market. In addition to facing the challenges experienced logistics
companies have regarding logistics in Brazil, LogTechs also deal with entrepreneurship obstacles
in the market.
Research objective
The objectives proposed for the present investigation are the following.
• Explore Industry 4.0 technologies that LogTechs in Brazil are applying
• Identify the challenges that LogTechs are facing in Brazil.
Research questions
The questions that arise from this scenario are intended to be answered throughout the
development of the research.
• What are the Industry 4.0 tools that can be applied to logistics operations?
• How are LogTechs in Brazil applying Logistics 4.0 technologies?
• What are the challenges that LogTechs are facing in Brazil?
Gap
There are numerous studies on Industry 4.0, Logistics 4.0, and its tools with a broader
approach or focused on large-scale logistics provider. This study seeks to deepen industry 4.0
tools use in logistics with practical examples of LogTechs operating in Brazil. There is a large
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number of studies covering topics such as industry 4.0 and logistics 4.0 solutions, its benefits,
maturity models to measure performance, historical background, concepts and opportunities.
However, the literature regarding LogTechs specifically is much more limited. This study will
contribute to obtain valuable information on this less explored field.

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Literature Review
Industry 4.0.
As a starting point for this research, it is important to draw some considerations about
innovation, which encourages the emergence of all the technologies to be mentioned later. It is
the innovation that generates competitive advantages and drives improvement, promoting
economic growth and the development of nations.
Innovation cycles
To have an overview of which were the most important stages of innovation in recent
years, Figure 1 shows the “Schumpeterian Waves of Innovation”.
Figure 1. Waves of Innovation
Source: (Levi Jakšić et al., 2018)
Summarizing those events, it seems that the first wave began in 1785 with the
introduction of waterpower, textiles and iron; in 1845, the steam, rail and steel changed the
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industry; later, in 1900, electricity, chemicals and internal-combustion engine did the same; the
fourth wave started in 1950 with the launching of petrochemicals, electronics and aviation; and
finally, in 1990, digital networks, softwares and new media revolutionized the industry one more
time. (World Economic Forum, 2021).
Compared the extension of each wave, it is easy to notice that the period of time from the
first one to the fifth, was certainly shorter as the industry evolved. Thus, the time would be
shortened between the next waves over a long period of time.
Some new theories, suggests that we are already facing a sixth wave of innovation.
Technologies like Artificial Intelligence, Internet of Things, robots, drones and clean tech, are
reshaping the global market (World Economic Forum, 2021).
Later on, this same concept of waves of innovation will be associated with the so-called
"Industry Revolutions", with the corresponding versions 1.0, 2.0, 3.0 and the current and latest,
Industry 4.0. According to Ferreira and Lisboa (2019), the Industry 4.0 can be associated with
the sixth industrial revolution.
Industry 4.0 definitions
Industry 4.0 refers to the fourth industry revolution. The concept was used for the first
time in 2011, at one of the largest trade fairs in the world, the Hannover Messe. Later, the term
was also adopted by the industry and the German government, to finally be spread by the rest of
the world (Hitpass & Astudillo, 2019).
There is no single and clear concept of Industry 4.0, but rather several definitions from
different researchers from a set of various disciplines. According to Koh et al. (2019) the concept
involves the following disciplines: Engineering (65%1), Computer Science (45%), Business,
Management and Accounting (16%), and Decision Sciences (14%).

22
McKinsey Digital (2015) defines Industry 4.0 as “a digitization of the manufacturing
sector, with embedded sensors in virtually all product components and manufacturing
equipment, ubiquitous cyber physical systems, and analysis of all relevant data”.
Pfohl et al (2015) state that “Industry 4.0 is the sum of all disruptive innovations derived
and implemented in a value chain to address the trends of digitalization, automation,
transparency, mobility, modularization, network collaboration and socializing of products and
processes”.
According to Mc Dougall (2014) “Industry 4.0 or Smart industry refers to the
technological evolution from embedded systems to cyber-physical systems. It connects
embedded system production technologies and smart production processes to pave the way to a
new technological age which will radically transform industry and production value chains and
business models”.
For the purposes of establishing a definition to be used as a guideline for this research,
Wang et al. (2016) say “Industry 4.0 makes full use of emerging technologies and rapid
development of machines and tools to cope with global challenges in order to improve industry
levels. The main concept of Industry 4.0 is to utilize the advanced information technology to
deploy IoT services. Production can run faster and smoothly with minimum downtime by
integrating engineering knowledge. Therefore, the product built will be of better quality,
production systems are more efficient, easier to maintain and achieve cost savings”.
Industry evolution path
To fully comprehend the purpose of Industry 4.0, it is essential to study the many
changes that the industry has undergone and how impacted on markets and technologies.
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First industry revolution
Before to the First Industry Revolution took place, the majority of people in the United Kingdom
lived in rural communities and traveled narrow trails on foot or on horseback. Manufacturing,
mining, and trading operations employed a small number of people, because industry was limited
and concentrated in a few locations (Haradhan, 2019).
The steam engine's creation in 1760 triggered the first industrial revolution. It facilitated
the shift from agriculture and feudal society to modern industries, and it was defined by the shift
from manual to machine production (Xu et al., 2018).
The average income and level of life of average populations did not change much during
this first revolution. But it was noticed that more workers concentrated in cities as manufacturing
developed, and cities expanded fast (Haradhan, 2019).
Other notable events of this periods are the use of coal as a primary source of energy,
railways as a primary mode of transportation, and iron and textile industries boost (Xu et al.,
2018).
Second industry revolution
The Second Industrial Revolution occurs between 1860 and 1914, as a result of the
development of new energy sources such as gas, oil, and, most significantly, electricity (Xu et
al., 2018). What allowed the creation of all these advances, was the availability of capital and the
emergence of multiple business organizations. New types of transportation such as the airplane
and vehicle become available (Smith, 2001). The telephone and radio were the most recent
communication technology, at that time were mainly employed as strategic aspects and
instruments during the First World War and the Second World Cup, respectively (Xu et al.,
2018). Furthermore, combustion engines, chemical industries, alloys, petroleum and other
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chemicals were developed fostering the industry. Also, indoor plumbing with running water
come to the homes of citizens, which improved quality of life and therefore, life expectancy
(Haradhan, 2020).
Third industry revolution
During the Third Industrial Revolution flourished the need of renewable energy sources,
the use of information technologies, and the core of this revolution, the boost of the internet. (Xu
et al., 2018).
The Internet, enabled by technical advancements in computer hardware, software, and
telecommunications, reinvented business models. This shift in corporate operations has resulted
in remarkable increases in production, driven by both efficiency gains and the establishment of
new markets. (Smith, B., 2001). This efficiency was achieved with the implementation of
electronics and information technology to automate production. (Xu et al., 2018).
Fourth industry revolution
What differentiates the fourth industry revolution from the previous three and is the
extensive use of cyber-physical systems in production and the integration between intelligence
and networking systems (Li, et al., 2017). Industry 4.0 may be defined as a thorough digitization
and integration of manufacturing processes, beginning with the customer order and continuing
through the design of manufacturing processes to downstream product services (Wilkesmann and
Wilkesmann, 2018)
Industry 4.0 facilitates the continual improvement of resource productivity and efficiency
throughout the whole value chain (Wilkesmann and Wilkesmann, 2018)
Industry 4.0's objective is to accelerate digitalization and, as a result, the integration of
business activities horizontally and vertically. Therefore, real-time access to information on

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operations, inbound/outbound logistics, market demands, and product-customer interactions are
possible (Ardito et. al., 2018).
Industry 4.0 technologies
When identifying and classifying the technologies that are part of the fourth industrial
revolution, there is no defined list. Among them we can mention 3D printing, artificial
intelligence (AI), augmented reality, cyber security, big data analytics, cloud computing, Internet
of Things (IoT), machine learning (ML), robotic systems, smart sensors and others (Li, et al.,
2017) (Ardito, et. al., 2018) (PWC, 2021). However, the technologies that are mentioned most
frequently within the definitions of Industry 4.0 are Cloud computing, 3D printing, Big data
analytics and, above all, IoT.
Figure 2. Industry 4.0 technologies
Source: PWC (2021)

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Figure 3. Industry 4.0 enabling technologies
Source: Ardito, et. al. (2018)
3D printing
It is a process that utilizes additive manufacturing. The final products of 3D printing are
constructed from consecutive layers of materials, without the need for component assembly
throughout the manufacturing process. Additive manufacturing methods enable the production of
small quantities of bespoke items with complicated and lightweight designs (Koh et al., 2019).
3D Printing is employed in different areas, from the pharmaceutical industry and medical device
manufacturing to the manufacture of replacement parts and aviation components (Radivojevic,
2019).
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According to Radivojevic (2019), 3D printing will have a significant impact on logistic
processes and services under the following ways:
• regional logistic networks will become more complex, and new supply chain strategies
will be developed;
• companies will be able to offer new logistic services in the field of spare parts supply;
• logistic providers will be able to define a global 3D platform with a digital model base;
• and personalization of products and services, in accordance with user requirements, will
be realized through 3D printing in the closest distribution center. 3D printing enables the
customer to order things, resulting in an increase in delivery and a reduction in stock
expenses.
Artificial Intelligence (AI)
Peres, et al. (2020), define Artificial Intelligence as a “sub-discipline of computer science
dealing with the development of data processing systems that perform functions normally
associated with human intelligence, such as reasoning, learning, and self-improvement”.
Yao, X., et al. (2017) state that the ongoing interest in AI began around 2010, fueled by
three factors:
• the sources of Big Data, which include e-commerce, social media, the research
community, organizations, and government;
• the machine learning approaches and algorithms that have been dramatically improved as
a result of the raw data provided by Big Data;
• and the powerful computers that enable Big Data computing.

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AI technologies may be seen as facilitators for systems to comprehend their context,
analyze collected information, and solve complex problems, as well as to learn from experience
and enhance their capacity to do certain tasks (Peres, et al., 2020).
Big data analytics
Big data is created from a growing number of sources, including internet clicks, mobile
transactions, user-provided content, and social media, as well as purposely generated material
through sensor networks or commercial activities such as sales inquiries and buy transactions
(George, G., et al, 2014).
To make sense of the enormous amount of information collected, Big Data technologies
include tools and techniques for storing, transferring, processing, and analyzing massive volumes
of data that cannot be stored, processed, or analyzed using conventional tools and database
technologies (Radivojević, 2019). Based on the processed information, effective decision-
making can be done.
Manufacturing businesses have recognized that data analytics skills are critical to
maintaining a competitive edge in the digital era. As a result, they focus their efforts to honing
their algorithm building and data interpretation abilities. (Koh et al., 2019).
An example of a Big Data analytical methodology is Data Mining, that facilitates the
discovery of hidden information, connections, rules, and logic within the data. It has multiple
predictive applications like forecasting market trends, user behavior, and the causes of diseases
(Radivojević, 2019).
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Blockchain
Blockchain technology have garnered widespread interest and sparked several initiatives
across various sectors. The financial sector, is seen as the principal user of the blockchain
concept (Nofer et al., 2017). However, it is also being exploited within logistics operations.
At first look, the Blockchain seems to be a simple data structure for recording
transactions (Ghiro et al., 2021). A block is a collection of data and information about a single
transaction that is appended to the preceding block to establish a chain. Blockchains may be
discovered with all parties involved in commercial transactions, providing information visibility
and availability (Radivojevic, 2019). Blockchain technology in logistics and supply chains
enables information security, protection, and monitoring, data transparency for all partners and
users, financial savings through smart contracts, and the creation of new business models, among
other benefits (Radivojevic, 2019).
Cloud
Cloud computing centers are capable of storing and processing massive amounts of data,
which benefits manufacturing and production while also providing enterprises with increased
performance and cost savings. Cloud-based manufacturing is essential to the successful adoption
of Industry 4.0. (Koh et al., 2019).
Cloud Computing refers to the usage of a variety of computer services over the Internet
and can be reached through different devices, which provides flexibility. A large number of users
can share the same resources and the cloud monitor and measure resource usage for each user in
real time. In this way, logistics organizations no longer need to invest in software applications
and hardware infrastructure (Radivojevic, 2019).

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Internet of Things (IoT)
It enables the integration of intelligent machines, sophisticated predictive analytics, and
human-machine cooperation with the goal of increasing productivity, efficiency, and accuracy.
(Koh et al., 2019)
It may result in the establishment of virtual networks to support the smart factory; at the
same time, it enables the factory to collect and send data in real time. And therefore, it facilitates
distant manufacturing operations and has an effect on stakeholder cooperation. Kevin Ashton, a
British entrepreneur and creator of start-ups, conceptualized the Internet of Things. The concept
was developed in 1999 to describe a system in which the material world interacts with computers
through ubiquitous sensors (Witkowski, 2017).
According to Witkowski (2017), the Internet of Things is defined by three features:
context, omnipresence, and optimization.
• Context: the object's ability to interact with an existing environment and its quick
responsiveness to changes.
• Omnipresence demonstrates that items are much more than links to a user network of
human operators in the modern day.
• Optimization: is the expression of an object's functioning.
The use of identification technologies to various items in logistics has resulted in the
creation of intelligent containers, pallets, packing, packaging, vehicles, shelves, forklifts,
infrastructure, ports, and terminals, among others. Numerous Internet-connected devices are
available in logistic systems, which eventually result in global inter-connections (Radivojevic,
2019).
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Machine Learning
Machine Learning is acknowledged a fundamental subfield of AI, however not the only
one. Anyway, the names are being used interchangeably at times (Peres, R. S., et al, 2020).
Machine learning is a sub-division of artificial intelligence. Artificial intelligence is described as
a machine's capacity to emulate intelligent human behavior. Therefore, AI allows solving
problems like humans would do (MIT Management Sloan School, 2021).
Rather of manually writing algorithms, a machine learning model will be trained on pre-
existing data. Following that, the machine learning model is capable of performing taught tasks
on raw data (Knoll et al., 2016).
Robotic systems
Industrial robots are machines with automated and integrated intelligence and
capabilities, which are required to improve the manufacturing process (Bayram and Ince, 2018).
Robotics has been used in manufacturing for many years, however, modern robotics systems are
more adaptable, autonomous, and intelligent, capable of communicating and cooperating and
also capable of learning (Koh., et al., 2019)
Utilizing robots and automation in manufacturing processes allows the following
benefits: increased product quality and safety, reduction of mistakes, required manpower and
expenses, and improvement of quality standards. (Radivojevic, 2019).
Principles and fundamental of Industry 4.0
As shown by history, the primary objective of every industrial revolution has been to
boost output; each revolution has resulted in a profound transformation of factories. It seems that
this time, the apparent future of manufacturing is the intelligent production combining the
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physical and digital worlds is a massive undertaking that spans several areas such as robots, big
data analytics, simulations, sustainability, and humanism (Lasi et al, 2014)
Several businesses are having difficulty defining and executing Industrie 4.0 scenarios.
Design principles and fundamentals address this problem by giving a "systematization of
knowledge" and specifying the parts of a phenomena (Hermann et al., 2016).
According to Lasi (2014) the fundamentals of Industry 4.0 are as follows:
• interoperability, which is achieved through the ability of people and machines to
communicate via the Internet of Things and Internet of People,
• virtualization, Cyber-physical Systems, and Digital twins, which must create a virtual
copy of reality,
• decentralization, which occurs without human interaction,
• and real-time capability, which occurs when data is collected in real-time during
telecommunications.
• Modularity, since the manufacturing process must adapt to changing market trends and
client demands.
Logistics 4.0
Logistics definition
The term "logistics" derives from the French "Logis," which refers to army lodging. The
Greeks used the word "Rhocrematics" to refer to the study of material flow. Early in the
nineteenth century, the military created logistics and described it as the planning and
transportation of soldiers (Amr et al., 2019).
Logistics is defined as "the collection of means, procedures, and infrastructures that
ensure the storage, transportation, and/or delivery of goods and services to the consumer, from
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both the point of origin of raw materials and the point of manufacture" (Oleśków-Szłapka &
Stachowiak, 2018).
However, if we want a more comprehensive definition of this phrase, Martin Christopher,
author of "Logistics and Supply Chain Management" (Christopher, 2011), provides the
following: "Logistics is the process of strategically managing the acquisition, movement, and
storage of raw materials, components, and finished inventory (product finished) within an
organization and its marketing channels in order to maximize current and future profitability
through cost-effective order processing." We are not only talking about ensuring that customers
receive their goods, but also about the organizations in charge of this duty maximizing the
profitability of their logistics systems while retaining cost efficiency.
In all definitions it seemed a common idea, it is that Logistics 4.0 is understood as the
application of Industry 4.0 technologies to processes and operations of the logistics chain in
order to make it more efficient.
Logistics in Brazil
The continental dimensions of Brazil and the provision of existing infrastructure, such as
logistics, are two main challenges for the productive sector in the country. As deficiencies in
transport networks increase logistics costs, which are equivalent to 12% of Brazilian GDP,
second given by Inter.B consulting. It is the index of the highest level registered in other major
nations in territorial extension, such as the United States (8%), Canada (8%) and Russia (9.5%).
(Exame, 2021)
Two big problems are the main causes of the market's waste: dependence on the road
transport and insecurity. In the first case, the Confederação Nacional dos Transportes (CNT)
understands that this modality corresponds to 60% of all or non-country merchandise traffic.
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Barely the size, quantity and quality of Brazilian roads represents a challenge that involves high
costs in commercial logistics from the calculation of freight or monitoring of deliveries and
vehicles selected for operation. (Mundo Logistica, 2020).
According to de Brazilian National Transport Federation (CNT) (2020), in Brazil, most
part of the cargo is transported within the country via the road system; followed by railway,
maritime, pipelines and air system, in that order. But even being the main transport modality,
from the 1.720.700 km of roads in Brazil, only 213.452 km (12,4%) was pavemented in 2020,
according to de CNT 2020 annual report.
Logistics 4.0 development path
Logistics 4.0 was established in 2011, supporting Industry 4.0. Nowadays, words such as
Supply Chain 4.0, Procurement 4.0, Marketing 4.0, Distribution 4.0, Warehousing 4.0, Inventory
Management 4.0, and Order Management 4.0 are often used. This is the logistic industry's
answer to the development and needs of Industry 4.0. Logistics 4.0 applies Industry 4.0
activities, from market needs processing and production planning through the delivery of smart
goods to end users. The answer lies in the digitization of logistical operations and processes.
(Radivojevic, 2019).
However, to get to this point, logistics also evolved with each industrial revolution, as it
is summarized below.
Logistics 1.0
The supply chain was managed locally, and logistics were centered on push delivery
processes. Warehouses were utilitarian structures in which raw materials and completed products
were stored on the floor and goods were moved by hand carts. The owners of factories and shops
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were responsible for the coordination of manufacturing and logistical operations. (Radivojevic,
2019)
As a result, logistics was limited to optimizing the three P's, as defined in: (Amr et al.,
2019).
• Place (Location and Destination) - Adding value to the consumer by transporting things
between places that maximize the customer's value.
• Period & Pace (Time value) - concentrating on time creates value for consumers. This is
essential in the management of inventories and the flow of commodities.
• Pattern (Ordering Forms) - The process of creating value by concentrating on the
intended forms.
The phrase logistics, or Logistics 1.0, originated in military uses and transferred to
corporate organizations in the 1960's. However, it was focused on optimizing transportation and
moving commodities inside an organization, which was supported by transportation instruments.
Thus, logistics 1.0 met the industrial requirements established by the clients in the first place
(Amr et al., 2019).
Logistics 2.0
The second industrial revolution occurred during the late nineteenth and early twentieth
centuries and was characterized by the introduction of assembly lines and mass manufacturing
(Radivojevic, 2019). Automation of cargo handling was referred to as "Logistics 2.0" in the
logistics sector (Amr et al., 2019).
This time was remarkable by the many discoveries and innovations that altered the course
of civilization. Logistics began to gain importance when new forms of transportation emerged.
As a consequence, globalization of supply chain management resulted in the development of

36
logistic networks, the emergence of new professions and organizations specializing in specific
logistic operations and processes. (Radivojevic, 2019)
During the second Industry Revolution, the logistics concept added the fourth "P";
Process Coordination or Partnerships management. Warehouse and road activities also have been
included in the managerial coordination for the first time. This resulted in an increase in
interaction between diverse firms that act as suppliers to one another. As a consequence,
Logistics 2.0 focused on the process of coordination between various stakeholders involved in
the same supply chain. (Amr et al., 2019).
Logistics 3.0
The third industrial revolution was defined by the developments in information and
communication technologies and their use in the producing sector. The use of computers in
manufacturing processes was essential during this time period (Radivojevic, 2019).
The notion of Logistics and Supply Chain Management was established. Logistics makes
use of ICT, identification technologies, and facility monitoring, as well as electronic data
exchange methods, innovative technological solutions, and software applications for process and
activity management (Radivojevic, 2019)
Furthermore, a new "P" was added to Logistics to emphasize "Flow Management." The
fifth "P" was called "Pliancy" or "agility," since the emphasis was not just on physical flow.
Additionally, the approach analyzed processes at each organization's administrative levels,
financial flows, service flows, the flow of choices and ideas, and anything else that adds value to
the customer (Amr et al., 2019).

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Logistics 4.0
Industry 4.0 refers to the development and integration of new information and
communication technologies into the manufacturing process, with the primary objective of
promoting intelligent networking of products and processes across the value chain, enabling for
more effective utilization of organizational processes in the development of goods and services,
hence increasing consumer benefit via unique products and services. (Barreto et al., 2017)
Logistics 4.0 is defined in two ways: processual, where supply chain processes are a
focus of Logistics 4.0 activities; and technical, using tools and technologies that assist internal
supply chain processes (Olesków-Slapka and Stachowiak, 2019). "Logistics 4.0" is used to refer
to the convergence of traditional logistics with cyber physical system-developed technologies
and applications. Logistics 4.0 is a subset of Smart Services and Smart Products. (Barreto et al.,
2017)
Figure 4. Industry 4.0 in Logistics
Source: Khaksari (2018)

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Barreto et al. (2017) states that a robust and effective Logistics 4.0, depend on the
following applications: resource planning, inventory management, transportation management,
intelligent transportation systems, and information security.
In the logistics sector, where businesses handle millions of daily shipments, massive
volumes of data are collected through order transcripts, clever low-power sensors, GPS, RFID
tags, weather predictions, and even social media. By integrating automation, the Internet of
things, drones, 3D printing, and creative applications, warehouse operations may be enhanced,
becoming smarter, more connected, automated, and robotized. (Olesków-Slapka and Stachowiak,
2019).
In the next figure, Glistau and Coello (2018), summarize the main applications of
Logistics 4.0 nowadays, dividing into cyber-physical modules and utilities, and smart
infrastructure.
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Figure 5. Some typical solutions of Logistics 4.0
Source: Glistau and Coello (2018)
Advantages and disadvantages of Logistics 4.0
Like all technology, Logistics 4.0 appliances have their challenges. Most part of the
disadvantages or challenges that represent, comes from the technical requirements and
implementation of the solutions. Logistics 4.0 is based on advanced knowledge and high-end
solutions; that is why, the ability to identify, assimilate and use the knowledge, is a valuable
competitive advantage. (Oleskow-Szlapka and Stachowiak, 2019). Below we can cite the
advantages and disadvantages of Logistics 4.0 according to Oleskow-Szlapka and Stachowiak
(2019).
40
Figure 6. Advantages and disadvantages of Logistics 4.0.
Source: Oleskow-Szlapka and Stachowiak (2019)
Logistics 4.0 common applications
Information security. Just as technology has great benefits that make the supply chain
more efficient, it can also generate deficiencies that represent risks to business security.
Information leakage and cyber-attacks are common nowadays. Therefore, the implementation of
new technologies must be accompanied by investments in security. (Barreto et al., 2017).
Pricing. When selectin suppliers, pricing tools are valuable to calculate and forecast
optimal prices. Some variables analyzed are production capacity, market demand, variety and
transport conditions (Jahani et al., 2021).
Reducing Costs. Many technologies such as IoT make operations more efficient, and
consequently, are also cost-effective. Results as having adequate stock control, avoiding last
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minute orders, reducing waste, -all of them as result of IoT implementation- has a positive
impact on cost reduction. (Jahani et al., 2021)
Resource planning. The importance of using industry 4.0 tools in resource planning is so
important that the term Procurement 4.0 is gaining space. Some benefits are efficiency,
effectiveness, profitability, valuable support for decision making and the development of new
business models (Bienhaus and Haddud, 2018).
Risk management. Supply chain involves several risks, and digitalization through
Industry 4.0 technology represents a mitigation method to address them. Risks like damaged
cargo, misplacement, contract negotiation, can me significantly reduced. One of the key elements
for this purpose is blockchain adoption (Jahani et al., 2021).
Transportation management systems. It is a specific area of supply chain management
systems, which focus on order management system with distribution system. Also enables the
interaction between manufacturer, carrier, customers, and other players involved. TMS allows
cargo tracking, negotiation, shipments planning, and other advanced functions (Barreto et al.,
2017).
Warehouse management systems. Multiple stake holders are able to interact through a
WMS platform, which makes coordination more effective. Some of the benefits are cargo and
vehicles tracking in real-time, accurate arrival prediction and warehouse allocation (Barreto et
al., 2017).
Logistics 4.0 in global companies
DHL. It provides several technological solutions to improve supply chain, such as
Celluveyor, DHL Resilience360, DHL Smart Sensor, Vision Picking, EffiBOT, automated
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container unloading, outdoor goods movement by autonomous vehicle and robotic sorting (DHL,
2021).
- Celluveyor or “Cellular Conveyor”– consists in a automated omnidirectional
packages conveyor. This solution won the 2016 DHL Innovation Day “Shark Tank”
contest. The Celluveyor is composed of multiple hexagonal conveyance cells with
three omnidirectional wheels. This enables infinite number of patterns for developing
handling approaches.
- DHL Resilience 360. It is a novel cloud-based risk management tool, that address the
study of several variables as climate changes, globalization and political and social
instabilities that could impact on supply chains.
- DHL Smart Sensor. Besides real-time cargo location, these sensors monitor
temperature, humidity, shock, light and also, air pression variations.
- EffiBOT. Under DHL support, the French start-up EffiBOT developed an automated
order picking using robotics. The trolley follows the pickers around the warehouse
and significantly reduce physical work. Furthermore, it is designed to avoid accidents
during operations.
- Vision Picking. DHL applies augmented reality through the Vision Picking tool. It
allows de pickers to create virtual environments and optimize procedures. Its adoption
was boosted during the pandemic, and it is expected to expand to other industries in
the next years.
- Automated Container Unloading. Unloading operations represents a very physical
demanding task loose loads from containers is one of the most unattractive activities
in logistics and requires the involvement of several operators. On the other hand,
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DHL Automated Containers Unloading can be operated by a single operator, the task
becomes highly efficient and with the minimum margin of error.
- Outdoor Goods Movement by Autonomous Vehicle. Autonomous vehicles can
outperform human driving tasks, by repeating tours along the day and not being
fatigued or distracted and avoiding accidents generated by obstructions.
- Robotic Sorting. Traditional manual sorting is time-consuming and tend to make
mistakes, that is the reason why robotics can facilitate this operation. a demanding,
time-critical and error-prone task. A robot arm with a camera can recognize labels
and classify packages to place them in the right position. makes it possible to carry
out this task with high effectiveness and the minimum margin of error. (DHL, 2021).
Maersk. The company considers investment in Industry 4.0 essential as a long-term
strategy, investing mainly in digitalization, Internet of Things and blockchain (Chi Li, 2018).
- Remote Container Management (RCM) system. Provides the transmission of
containers information in real-time, such as exact location and temperature, regarding
refrigerated containers. The temperature and humidity monitoring are essential when
transporting fresh goods.
- Blockchain. Maersk shipping records are being protected by blockchain technology,
the information cannot be altered and, therefore, fraud is diminished, and traceability
is very reliable. The blockchain adoption represents around billions of dollars
savings.
- TradeLens. This platform, also based on blockchain technology. Through
TradeLens, a supply chain network that is also based on blockchain technology,

44
several stakeholders can interact and access to real-time and reliable cargo
information. (Chi Li, 2018).
Technological impact on logistics
Amr et al., (2019), compared the expected impact of the Fourth Industry Revolution on
manufacturing, logistics services and retail sectors. The results showed that the highest rate of
cost reduction was seen on the logistics services, with a reduction of 34.2%. Also, when
analyzing the expected additional revenues, as the result of the implementation of these
technologies, the logistics services obtained the best outcome with 33,6% of revenues.
Figure 7. Fourth Industrial Revolution impact on manufacturing, logistics services and retail
Source: Amr et al. (2019)
These results can explain how crucial is the application of Industry 4.0 technologies to
logistics, and hereby, the need of creating a whole new area under the name of “Logistics 4.0”
Another study on the subject, presented by the World Economic Forum (2017), agrees
with the stated before, that Industry 4.0 technologies affects positively to the logistics sector. The
Figure 8 shows that logistics companies applying Industry 4.0 technologies, reports 33,6% of
additional revenues, 34,2% presents a cost reduction, 17,8% of the companies presents both
positive results, cost reduction and additional revenues. And finally, only the 14,5% of the
companies reported no impact; which is a low number compared with the 20,1% from
manufacturing industry and 25,5% from retail.

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Figure 8. Expected impact of digital transformation on the cost situation in companies
Source: World Economic Forum (2017)
In the same way, it can be noted that the degree of extensive application of these
technologies is comparatively higher in the logistics area. Even so, it must be recognized that the
degree of application is still considerably low, and more than 40% of the companies from the
three sectors do not even plan to do so.

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Figure 9. Digitalizing business models by sector
Source: World Economic Forum (2017)
Logistics 4.0 evaluation model
The Council of Supply Chain Management Professionals (CSCMP) defines logistics as
the process involving planning, implementing and controlling (management), efficient
transportation of goods (flow of materials) and exchange of information (flow of information).
(Oleskow-Szlapka and Stachowiak, 2019).
Based on that definition, Oleskow-Szlapka and Stachowiak (2019) created a framework
to analyze the Logistics 4.0 performance of a company, dividing into three main evaluation
areas: management, material flow and information flow.

47
The conclusions about the Logistics 4.0 performance of the companies under analysis,
may be reached based on the quantity of solutions implemented, the awareness and commitment
of the leaders, and the level of integration within the operations.
Figure 10. Logistics 4.0 dimensions
Source: Oleskow-Szlapka and Stachowiak (2019)
Management: the first dimension represents the foundations of logistics and its
connection with innovation. Tasks as ongoing investments, products design, innovation roadmap
and strategy, integration of value chains and others, are evaluated.
Material flow: involves all the tools that facilitate the flow of goods in the most efficient
way possible. Automation, robotization, Internet of Things, augmented reality, are examples.
Information flow: enables the use of large volumes of information, so that it is available
in real time, to analyze it and help decision-making. Some of these tools are IT systems, data-
driven services, machine learning and others.
Start-ups
According to Blank and Dorf a start-up can be defined as “a temporary organization in
search of a scalable, repeatable, profitable business model”. Baldridge and Curry (2021) say
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“startups are young companies founded to develop a unique product or service, bring it to market
and make it irresistible and irreplaceable for customers”. Relevant factors as education and
economic growth of a nation relies on its capability to innovate (Tripathi et al., 2018). The role
that startups play in this field is essential, and the results of the growth of nations demonstrate it.
Start-ups classifications
Fonseca and Franco (2021) stablished a classification for start-ups according to its target
public, income model and stage.
Figure 11. Nomenclature and classification of Startups according to the Target Public
Source: (Franco, 2021)

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Figure 12. Nomenclature and classification of Startups according to the Income Model
Figure 13. Nomenclature and classification of Startups according to the Stage.

50
The role of startups in the economy and development
In “The Theory of Economic Development” (1934), Joseph Schumpeter explains the key
role that the entrepreneurs play for a country’s economic growth. He highlights how an active
entrepreneur can bring innovative ideas that dramatically change and evolve a market (Carree
and Thurik, 2003).
Besides impacting on a country’s GDP, startup success can highly benefit its local
environment, with direct job positions creation and improving living standards. A clear example
for technological startups is Silicon Valley (Szarek and Piecuch, 2018)
To get an overview of which are the cities most impacted by startups success, there is
The Global Startup Ecosystem Report (GSER), carried out by Startup Genome and the Global
Entrepreneurship Network. The latest ranking published in 2021 shows that North America
remains dominant with 50% of the top 30 on the list, followed by Asia with 27% and Europe
with 17%. The presence of Latin America is notoriously low compared to other regions.
However, in 31st place is the city of Sao Paulo, which shows the great potential that Brazil has in
terms of innovation (Startup Genome, 2021).

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Figure 14.The Global Startup Ecosystem Ranking 2021
Source: (Startup Genome, 2021)

Figure 15. Share of top global ecosystems by continent
Source: (Startup Genome, 2021)

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LogTechs
In addition to these classifications, there are terminologies adopted to distinguish which
market each start-up is targeting. This is what is shown below with the term "LogTech".
Definition
LogTechs are companies that apply technology to logistics solutions. Just like FinTechs
(Finance), LegalTechs (Legal), these start-ups are growing in innovating in the market (CargoX,
2021).
The logistics service market is being disrupted by technological advancements and
emerging LogTech start-ups are capitalizing on these developments. On the other hand,
consumer expectations in the logistics service business continue to grow, requesting shorter
delivery times, pricing optimization, and more flexible transportation (Wehberg, 2020).
Wehberg (2020) states that typically have three major advantages compared to their more
traditional peers:
- LogTechs operate with asset-light or in some cases asset-zero infrastructure and
corresponding business models.
- While creating online marketplaces, interfaces and dashboards, they are able to
connect the demand with the supply . As a result of this they gain ownership of
the customer interfaces via customer data.
- Eventually, their post-digital character more naturally embraces lean structures
and a resilient working style. This leads to a high degree of agility and flexibility.
- LogTechs use asset-light or, in some situations, asset-free infrastructure and
business structures.
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- They successfully link the demand and supply sides by developing online
markets, user interfaces, and dashboards, and thereby acquire control of the
consumer interfaces via the use of customer data.
- Their digital nature adopts lean methodology, and this results in an extremely
high degree of agility and adaptability.
LogTechs worldwide
Some examples of LogTechs founded and operating outside of Brazil are briefly
described below.
Cloud Trucks
Founded in 2019, the company developed an app that manages load booking as a virtual
trucking carrier application. Cloud Trucks provides instant payments, schedule optimizer,
competitive rates, business intelligence tools, truck leasing assistance, and others (Cloud Trucks,
2021).
Hive
Hive offers warehousing service to online stores. The customers are able to connect their
software to Hive’s platform via API, with no coding or complex mechanisms. Hive provides
flexible storage at its fulfillment center, with no volume or timing restrictions. Furthermore,
packing and delivery is managed by Hive. And throuout the whole process, all the information is
tracked and analyzed in real-time, providing records and forecasts for decision-making (Hive,
2021).
SILQ
SILQ uses the combination of data analysis and machine learning tools with on-site
professionals, to monitor overseas manufacturing. The online platform shows timelines, updates,
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milestones in real time. Tasks like sampling and quality control are carried out on-site by
experts, ensuring the success of the operation, even with the challenges of distance and pandemic
restrictions (SILQ, 2021).
LogTechs in Brazil
Brazil faces challenges linked to packaging, management, stock and storage, freight,
transport and delivery of products and inputs, reflecting the five main sources of high costs for
the sector. Expenditures, for example, on transport reach R$415 billion, Inventory R$270 billion,
Storage R$268 billion, Administration R$27 million, giving a total of R$750 billion spent on
logistics in Brazil - 12.7% of GDP. Compared to the US reality, for example, such costs do not
even represent 8% of GDP. (Distrito, 2020)
From studies carried out in Brazil, the growth of start-ups with a focus on industry 4.0
technologies applied to logistics operations, is at its peak. The "District" innovation platform has
been able to identify 283 Brazilian LogTechs, in its last study carried out in 2020 (Figure 17).
Furthermore, according to historical records, it can be appreciated that the growth has been
accelerating in the last 5 years. However, it was possible to notice a marked slowdown in 2019,
with the impact of the Covid-19 pandemic (Figure 16).

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Figure 16. Exponential growth in the last five years
N° of start-ups accumulated
N° of start-ups per year
Source: Adapted from Distrito (2020)

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Figure 17. 283 Brazilian LogTechs
Source: Distrito (2020)
As addressed before, “logistics” is a broad concept that encompasses several operations
within the supply chain. Therefore, Distrito subdivided the identified LogTechs into 5 divisions
and 10 subdivisions, which are as follows:
- Logistics Management:
- Cargo management
- Delivery management
- Fleet management
- Freight marketplace
- Reverse logistics:
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- Waste
- Packaging
- Stock:
- Stock 2.0
- Last mile
- Delivery:
- Last mile
- Door to door
Taking this classification as a reference, the research will focus on the logistics
management category. Logistics Management encompasses solutions that leverage analytics, the
Internet of Things, and artificial intelligence to increase efficiency and security or to reinvent a
specific activity, stage, or equipment involved in the management of the logistics process.
Covid impact on LogTechs
Covid-19 pandemic dramatically impact on business worldwide. Several countries have
taken tough measures in response to the Covid-19 spreading globally, therefore, it dramatically
impacted on business worldwide (Kuckertz et al., 2020). Entrepreneurs were compelled to adapt
its supply chain to the new health-emergency behavior. Considering lockdowns and restrictions,
this meant, speeding up digitalization process and going part or 100% online. Besides websites
and apps, sales were redirected to online marketplace and social media played a key role,
because consumers were spending more time on them (Rodrigues and Soares, 2021).
In addition, it is important to note that for the majority of startups that already had a
strong focus on technology, the pandemic has accelerated their refining and innovation
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capabilities. Likewise, it favored the creation of new startups directly focused on meeting needs
that were generated during this new pandemic lifestyle (Rodrigues and Soares, 2021).
Some governments such as the Chinese, have developed strategies to promote
entrepreneurship, being aware that Covid-19 could significantly impact the economy. Mainly,
the countries and localities highly dependent on tourism, were the most affected. These results
could be seen in the world bank reports on gross domestic product (GDP) by nation (Meahjohn
and Persad, 2020).
Below, Meahjohn and Persad (2020) graphically expose the main effects of the pandemic
on startup operations globally. In second place are disruptions in the supply chain, with 34%.
Figure 18. Summary of How Covid-19 has impacted entrepreneurship globally
Source: (Meahjohn and Persad, 2020)

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Challenges LogTechs face
The pandemic is just one of the latest and greatest threats businesses face globally. However,
even before that, startups face a countless of challenges before reaching a certain maturity level.
Giardino et al. (2015) identify major challenges that startups face in early stages.
- “Thriving in Technology Uncertainty. developing technologically innovative
products, which require cutting-edge development tools and techniques.
- Acquiring First. Paying Customers persuading a costumer to purchase the
product, e.g. converting traffic into paying accounts.
- Acquiring Initial Funding acquiring the needed financial resources, e.g. from
angel investors or entrepreneurs’ family and friends.
- Building Entrepreneurial Teams. building and motivating a team with
entrepreneurial characteristics, such as the ability to evaluate and react to
unforeseen events.
- Delivering Customer Value. defining an appropriate business strategy to deliver
value”.
The role of incubators and accelerators
Incubators and accelerators collaborate to overcome the first big obstacles that startups
face. They provide programs to coach entrepreneurs and founders within their journey, with the
goal of enabling them to develop their early-stage ideas into viable and successful business. This
coaching may involve know-how sharing, lean and agile methods, business plan and customer
networking (Tripathi et al., 2018).
Governments seeking to boost entrepreneurship should consider incubators and
accelerators within their strategies. These programs are of short duration, they represent a low
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investment for the governments or private entities that promote it, nevertheless, with very
positive results (Startup Genome, 2021)

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Methodology
This section presents the methodology used for this research and is divided into two
segments. First, in "Aims and Objectives" is clearly established what is intended to achieve with
this research and what will be the guiding questions for its development. Second, the
"Methodological Approach" describes in detail the research design, delimits the sample, and
finally, determines the data collection and analysis methods.
Research Design
Based on the established research questions, a qualitative approach is the best suited to
answer them appropriately. This design allows to thoroughly describe the basic concepts such as
Industry 4.0, Logistics 4.0 and LogTech. Furthermore, it enables the exploration of the different
existing tools to optimize logistics operations and the analysis of specific cases that are
successful in Brazil.
According to Denzin and Lincoln (1994),
“Qualitative research is multi-method in focus, involving an interpretive, naturalistic
approach to its subject matter. This means that qualitative researchers study things in their natural
settings, attempting to make sense of or interpret phenomena in terms of the meanings people bring to
them. Qualitative research involves the studied use and collection of a variety of empirical materials
case study, personal experience, introspective, life story interview, observational, historical,
interactional, and visual texts-that describe routine and problematic moments and meaning in
individuals' lives” (p.2).
Also, Cresswell (1998, p.15) defines qualitative research as “an inquiry process of
understanding based on distinct methodological traditions of inquiry that explore a social or
human problem. The researcher builds a complex, holistic picture, analyzes words, reports
detailed views of informants, and conducts the study in a natural setting”.

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Hence, the qualitative design proposed, provides more flexibility during the development
of the research, and moreover, provides information with a high degree of detail.
Data collection
As a first step, an exhaustive review of the existing literature was carried out. The search
for related literature began on academic articles platforms, with the following keywords:
"Industry 4.0", "Logistics 4.0" and "LogTech". The first search throw 80 potential sources. From
these results they were filtered using some selectivity criteria, such as year of publication,
reliability of the source, objectivity, accuracy, and relevance for the subject under research. After
this filter, there were 40 documents on which the review was developed.
After laying a foundation on the broader matter, the investigation continued with more
specific topics focusing on the Brazilian market. In this way, fifteen Logtecs were pre-selected to
carry out the interviews. From all of them, it was possible to interview three LogTechs with a
strong presence in Brazil. To collect the empirical data the method chosen was the interview. In
this way, the three founders of each LogTech were interviewed. The data analysis was carried
out through the case studies. As there were three different firms under analysis, it could be
considered a multi-case study.
Multi-case study
Gerring (2004) defines the case study as “an intensive study of a single unit with an aim
to generalize across a larger set of units”. A qualitative case study is a research method that
allows the investigation of a phenomenon in its full context using a variety of data sources
(Baxter & Jack, 2008). This guarantees that the topic is not examined through a single lens, but
rather from multiple perspectives, allowing for the discovery and understanding of numerous
aspects of the same event. (Baxter & Jack, 2008).

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Yin (2003) states that there are four main reasons to consider a case study design, and are
the following:
- The objective of the research is based on “how” and “why” questions
- The behavior of the individuals under analysis are out of the influence of the researcher
- Contextual insights are meaningful for the analysis
- Phenomenon and context limits are not evident
Case studies frequently allow several observations of a single case, resulting in more
solid evidence of the factual truth of a particular claim than would be achievable in a cross-unit
research (Gerring, 2004). Moreover, the case study research, analyzes single cases without
discarding any type of inferences from outside the scope of the current research (Gerring, 2004).
For this research, a multi-case study was conducted, allowing to contrast differences and
find similarities between them. In other words, a multiple case studies can be used to either, “(a)
predicts similar results (a literal replication) or (b) predicts contrasting results but for
predictable reasons (a theoretical replication)” (Yin, 2003).
For the development of the cases, primary information was obtained through interviews
with key representatives of the LogTechs. In addition, to complement the cases, secondary
information about each startup was obtained based on their websites and secondary interviews.
The anonymity of the LogTechs is preserved without mentioning in detail the source of the
secondary information neither.
Sample
The sampling method selected for this research was a purposive sampling. In this type of
sampling method, the members of a sample are chosen based on the study's goal. Deliberate or
judgmental sampling are other names for it (Bhardwaj, 2019).

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When selecting the companies to be analyzed, a filter is already made, taking into
account the criteria that must be met so that the results obtained by the study are relevant. With
this sampling method, it is almost certain to obtain information aligned with the objectives
because it is directed to a target audience (Bhardwaj, 2019).
Fifteen LogTech companies operating in Brazil were pre-selected. All of them were
presented on the market as strategic allies for logistics processes optimization, they rely on
investment in technology to generate added value and are highly committed to innovation.
At the time of the contacts to set the interviews, three of the pre-selected agreed to
collaborate. The other companies did not respond, or said they had no time available, or they
rather respond the questions by e-mail. Furthermore, the distance factor for not being in Brazil
due to the pandemic, could represent a disadvantage since it made it more difficult to reach
representatives and request the interviews.
The profile of the three interviewees is described below: two founders and a business
analyst.
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Table 1. Companies and interviewees
LogTech Company concept Interviewee
WMS platform start-up. Manages Co-founder and CEO. Business and

warehouses and distribution centers in real operational strategy of the company.
A
time. Supply chain and logistics management
specialist.
Beer industry logistics management. Business analyst. Commercial specialist,
Develop intelligent solutions for the identification of new business
B
different stages of the beer production and opportunities, market and trend analysis.
distribution process. Chemical engineer.
International trade business intelligence Founder and CEO. Specialist in
C platform. Tool to monitor, analyze and International Trade Logistics, Freight

optimize import operations. Forwarding and Customs Brokerage.
Source: own work
Interviews
The interview method was used for data collection. Its structure was based on the
Oleskow-Szlapka and Stachowiak (2019) Logistics 4.0 dimensions model. As already mentioned
in the literature review, the model is founded in the Council of Supply Chain Management
Professionals (CSCMP) definition of logistics, in which it is divided into three main areas:
management, material flow and information flow.
The interviews had a duration between 30 to 45 minutes. Two of them were held by
Zoom platform and one of them by phone call.
The questions were open and were formulated based on the objectives established at the
beginning of the investigation:
• Explore Industry 4.0 technologies that are being applied by LogTechs in Brazil
• Identify the opportunities and challenges that LogTechs are facing in Brazil
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Table 2. Interviews guidelines for evaluation
Logistics 4.0 Open questions

dimensions
Management Could you explain the concept and core business of the company?
How does the company manage innovation?
What is the projection and next steps for the company?
What are the challenges that the company faced in management matters?
Material flow Could you describe the Industry 4.0 technologies applied to manage products and
materials?
Could you mention the benefits and results obtained?
What are the challenges that the company faced in material flow matters?
Information flow Could you describe the Industry 4.0 technologies applied to manage information?
Could you mention the benefits and results obtained?
What are the challenges that the company faced in information flow matters?
Source: own work
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Results
After conducting the interviews with the representatives of each LogTech, the results are
presented below, always taking as a structural basis, the three-dimensional model of logistics 4.0
(Oleskow-Szlapka and Stachowiak, 2019).
LogTech A – WMS platform
Management
Concept of the company
LotTech A describes itself as “The industry's most complete WMS, the ideal solution for
companies wishing to keep the quality of their products and increase their stock’s accuracy”.
LogTech A offers a platform that automates and integrates the various stages of a
logistics operation, from purchase (VMI), through storage and transport, allowing companies to
carry out an integrated management of their suppliers, customers and carriers in a single solution.
LogTech A empowers customers and improves processes to ensure that everyone works
collaboratively, concentrating on efficiency and achieving better outcomes.
Thanks to real-time access to inventory, tasks, and process productivity, the
implementation of a WMS system optimizes operational and logistical processes. Additionally,
the system optimizes the use of available storage space, eliminates expenses associated with lost
items or raw materials, and shortens the time between stages, resulting in a higher level of
quality and agility in the services given to consumers (LogTech A online source).
The company launched in 2012 as a software developer with a focus on logistics
solutions. Between 2012 and 2017, the company gained the know-how to develop customized
software for companies from different industries.

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In 2018, we were invited by a client -who we were already attending with a specific
project- to create a WMS solution that could offer a more horizontal concept. The tool
would not only manage the internal processes of the warehouse but also make more
efficient communication with the suppliers and customers. (Interviewee A)
After the collaborative creation between the customer needs and successful
implementation, the company owned the software to commercialize it into the market.
“The WMS market is already widespread, and it can even be considered a “commodity”
within storage management” (Interviewee A). Although several solutions have been serving the
market for decades, launched by large companies, LogTech A had the advantage of being
already born on a web platform. It allowed them to not compete directly with online solutions,
which was a definite competitive advantage because the system focused on logistics operators.
Since the core business of the logistics operator is to sell space in storage matters, the focus was
not to have a heavy IT infrastructure.
Those more complex solutions involve a whole team managing the tool, the acquisition
of machines, and high-cost traditional hardware. Moreover, sometimes the clients depend on a
"forced" consultancy.
The positioning in the WMS market is positive, thanks to the ease of implementation and
its constant evolution. Our team is always working on developing new features to make
the processes of the clients more intelligent. Our partners and clients receive all the
updated features at no additional cost. The differential is to deliver a system that, in
addition to being Saas, can attend to some conditions with adaptability (Interviewee A).
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Today 70% of its clients are medium-sized companies, companies that in the Brazilian
have a monthly billing between 2 and 15 million of reais. Also, 15% are large size and 15%
small companies.
Innovation management
Today in the WMS market and logistics in general, the volume of start-ups building
solutions is remarkable. The segment of microservices to embed IoT intelligence in those
solutions ends up being a threat from a SWOT perspective” (Interviewee A). LogTech A
always aligns what develops with new technologies, either with sensors or even hardware
such as drones. They have a medium-term objective of making an inventory using
drones, collecting that data. “We have a plan to reserve 12% of turnover to invest in
innovation. (Interviewee A)
The team now is formed by twenty people, with a young profile. The team is enthusiastic
about the challenges from an innovation point of view. They work in a collaborative
environment taking into consideration any ideas and suggestions from all members.
Next steps
“As part of our innovation roadmap, we want to reach new markets. First, the
pharmaceutical, and after that, agribusiness, which is very strong, especially here in Brazil”
(Interviewee A).
Also, it will be open for investments to accelerate the interaction process and make the
company grow with external investment support.
Opportunities
“We are always careful to grow in a sustainable way, we do not worry so much about
doubling the size of the company, but rather about acquiring know-how, gaining security in the
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processes we serve” (Interviewee A). Today LogTech A attends industrial, automotive, food
control, asset control monitoring markets. The most recent is that it is now adjusting the system
to do pharmaceutical monitoring too. So, the developers are confident that after that follow-up,
they will launch the solution ready to enter into new projects and opportunities. It is considered a
vast opportunity considering that the monitoring of drugs is extensive, globally speaking.
We have a metric that in 2018, which was the first year of operation, the company grew
in average 28.5%. This number is based on the care to grow sustainably beyond bringing
the client without being prepared to serve them. (Interviewee A)
Innovation, robust agricultural monitoring in Brazil, essential commodity, leaving the
drug monitoring that is the current objective, they also want to explore the agricultural sector.
Challenges
For any technology company is a great challenge to keep up-to-date or even ahead.
Unfortunately, many start-ups start positively but quickly disappear because they cannot
keep up with the competitive market. (Interviewee A)
During the pandemic outbreak, the company grew 19%, unlike many other competitors.
LogTech A states that a large number of companies, as their operations were reduced, sought to
replace their WMS systems with a cheaper option but with comprehensive functionalities.
Material flow
Industry 4.0 technologies applied to manage products and materials
We do also assets traceability implemented in hospitals. Hospitals have many assets that
they need to manage; many of them are moved without prior planning in case of urgency.
The tool is very user-friendly; with simple clicks, the customer can update the assets'
status without moving many procedures and points. (Interviewee A)

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In terms of support, the software has servers in the cloud and they are located in two data
centers; one in the US and the other in Brazil. Both are synchronized and in case there is an
eventuality and one of them fails, the other remains operative. The tool does not depend on a
specific technology or hardware, which usually happens in the traditional market with WMS
systems. The access could be done from PCs, Android and iOS devices, almost from any
smartphone.
For the asset tracking, mainly RFDI technology is implemented, but also sensing tags.
“There are projects where the client does not initially want to invest in RFDI, therefore, we
manage to generate our own identification labels from the system itself, through QR codes”
(Interviewee A).
Among the main results of this tool, we can name the optimization of the processes,
focusing on the waste map of the lean methodology: inventory, waiting, defects, overproduction,
motion, transportation, over-processing.
Benefits and results
The key competitive advantage of the tool is the ease of adaptation. It is in constant
evolution, and the clients are not billed for new features and functionalities. All the
implementations originate at a client's need, which in the end, benefits the former clients as well.
Information flow
Industry 4.0 technologies applied to manage information
The clients have productivity control within the solution through a gamification strategy
to engage and motivate users. It works, giving a score to each operation within the warehouse
according to the complexity attributed. Therefore, each collaborator adds points, and the system
creates a ranking where efficiency can be monitored. “Both, managers and operators can consult
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positioning in terms of score. In this way, they apply gamification to improve productivity”
(Interviewee A).
A study carried out by our own implementation team, showed an efficiency increment of
20.7%, under the Lean framework for analysis; a series of activities are being eliminated or
better distributed between partners, suppliers, or clients.
With a traditional WMS tool, the users need to be sending indicators of the warehousing
management. On the other hand, with LogTech A’s tool “the stakeholders can access an external
portal of the tool to visualize these indicators. All these indicators essential for decision-making
are available in real-time, without any extra procedure. That part of the process has not been
measured yet, but it also represents an expressive part of the cost and time” (Interviewee A).
The company carried an analysis and detected several gaps in the market that needed to
be addressed. “We realized that in the storage services market were some gaps, which includes
the lack of communication in real time between a point of consumption of a stock to the
manufacturer” (Interviewee A). That information delay that usually occurs ends up generating a
high cost to maintain high levels of stock. The company developed the software already thinking
about addressing this issue. It was a friendlier and more flexible tool. “We ended up
concentrating all our efforts on this product and today it represents 98% of our turnover”
(Interviewee A).
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LogTech B – Beer industry logistics management
Management
LogTech B is a firm committed to the creation of intelligent and engineering solutions
that strives to bring the future closer to its clients by innovative co-creation and taking on new
challenges. LogTech B optimize and maximize the revenues of businesses using algorithms. The
primary focus is on brewers and beverage wholesalers; however, the beer market involves
serving from factories, bars to distribution. The online platform offered by LogTech B is
orientated to meet customer needs, with a tailored experience that solve challenges and enhance
operations.
Services are divided into four main areas: production planning (PP), supply chain
management (SCM), a self-service system (SSS) that improves the beer consumption experience
and finally, a smart climate sensor (SCS) that monitor temperature and humidity of the barrels
and bottles.
LogTech B PP service encompasses a system for improving production planning,
minimizing waste, and increasing profit margins in a brewery. It acts as an online data center,
allowing customers to observe the brewery in real time, manage raw material and finished
product stocks, follow production from start to end, and more. Some functionalities are:
- The Production Calendar is a useful tool that organizes and visualizes plant processes and
data (Transfer, Fermentation, Drying, Washing, Grinding, and Malt, for example. The
application facilitates tracking and functions as a task guide, ensuring that each step is
completed on time and in the proper sequence.

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- The Management of Inputs and Finished Products offers practical tools that can be
utilized on a regular basis and that ensure physical space efficiency. Stock management
for kegs is accomplished by the use of styles that vary by keg size and may be tracked
through the ability to produce warnings for low stock levels.
- All barrel and equipment movements inside and outside the brewery are monitored by
Operation Control. Additionally, delays in returns and abnormalities are reported through
warnings and emails. Additionally, it enables searching and analysis of all data by type,
client, beer, and route through reports.
- Additionally, the ArB | Brew has financial and commercial management capabilities that
are connected with the other accessible tools. The operational and commercial control
tools may be controlled through the ArB | App, which simplifies the operator's day-to-
day.
LogTech B SCM is system for controlling, tracking, and improving beverage distributor
operations. Controls every movement and identifies the asset's location along the operations path
using barcodes. The barcode may be scanned using the camera on the phone or a barcode reader.
Inventory control is accomplished by the identification of quantities and package
contents; this feature also keeps track of expiry dates and stock turnover.
LogTech B SSS is intended to be practical and to enhance the beer drinking experience.
It may be deployed around the city, as well as in a bar or factory, drawing more consumers and
promoting the self-service culture. The consumer selects the kind of beer and the necessary
quantity is extracted, all in an intelligent and integrated manner.To withdraw beer, the client
must pay using a card with credits. When the LogTech B SSS Card is brought near to our sensor,
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it activates the beer tap, allowing the consumer to serve himself and pay just for the exact ml
served.
Also, LogTech B keep the kegs, monitoring the level and detecting beer losses. It
provides access to sales records, loss reports, and all client and barrel data on a centralized
platform.
LogTech B SCS is a temperature measuring sensor with an accuracy of 0.5°C
fluctuation, a temperature range of -40°C to +80°C, and humidity resistance, assuring high
performance.
To operate the temperature module, a microprocessor with an integrated WiFi module
enables online and real-time data transfer, enabling monitoring from anywhere. The
microcontroller reads the temperature sensor's output and transfers it to cloud storage, where the
user may examine the data.
LogTech B is a company that develops intelligent solutions. By employing algorithms, it
is possible to optimize and maximize the profits of companies and industries. Their primary
markets consist of breweries and beer distributors. The company began its operations by
controlling and tracking the breweries' assets, like Barrels, cylinders, and chopp containers.
These barrels are products of high added value. It does not cost less than 70 reais; the clients
have around 3.000 to 10.000 units distributed around the complex supply chain, involving
breweries, distributors, bars, and other sales points. Then it is an expensive asset, which needs to
be controlled.
LogTech B reported:
We were surprised to realize that the solutions we offer are much more advanced
compared to the competition, even considering that we have been operating for less time.
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Our competitors sell its product at a low price and have simplified functionalities. Also,
our competitors offer the exact solutions for asset tracking. However, it does not throw
the same positive results, mainly because their methodology is not oriented to breweries,
that have a very particular supply chain. (Interviewee B)
Today, the team is formed by 9 members. As a new company, many sectors are still
being structured. The team members rotate between sectors, commercial, implementation, and
support, as used in many start-ups. Nowadays, the office is located in an incubator facility, an
innovation hub. The company was accelerated this year for three months—the representative
remarked on the positive impact and results after that period.
Innovation is always present because of the environment in which we operate; we have
the opportunity to interact with other technology companies in the hub. It contributes so
that the company never stops innovating and developing. We are do not seek to create the
most technological solutions in the world, but tools that with the help of technology can
solve specific problems, which is the main driver. (Interviewee B)
Next steps
Until today, the founders are very satisfied with the results and see great potential in the
start-up. As the next steps, they will seek to grow in industries other than brewing. Moreover,
they will continue to innovate in the beer industry, always based on customer needs and
feedback.
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Opportunities
The company is very satisfied with the results obtained so far and they are aware of the
responsibility that comes with keeping innovating in the market. But in addition, the company
sees as a great opportunity to seek to expand to other industries.
Challenges
The greatest challenge the company is facing is the resistance of the entrepreneur towards
these technologies.
Many breweries are running by two or three people doing everything, from production to
sales and deliveries. Then there is a resistance to adopt new technologies and leave that
traditional and often inefficient models. (Interviewee B)
LogTech B improves constantly based on customers feedbacks.
The pandemic directly impacted the beverage sector; bars were closed, and therefore, the
production decreased. However, as the epidemiological situation improved, so did the company's
business.
Material flow
Tracking is done within the border of the factory, production, packaging, washing,
dispatch, and when it goes to the customer facilities. LogTech B has already tried various
tracking methods, like RFID, low energy sensors, and Bluetooth.
So far, the results showed that the most efficient method that works for breweries is the
barcode. It works like this. The users download a mobile app on a smartphone, that reads
the barcode and identifies the equipment. Those barcodes come as labels that stick on the
equipment. They are incredibly cheap and last a long time. In comparison, RFID requires
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a higher initial investment, and considering that our customers are mainly small to
medium-sized breweries, they do not support this technology. (Interviewee B)
Both founders are chemical engineers with experience in the production area. Therefore,
the system also does all the Planning and Control of the Production (PCP) follow-ups. LogTech
B considers that the system should be an integral solution, non an isolated distribution, and
tracking tool. Therefore, it also includes management features, like sales and financial. In this
way, it guarantees greater effectiveness and quality of management for the breweries.
An essential point in terms of food and beverage industries is the product quality and
traceability in case of emergencies.
There have already been cases in which some breweries had contamination. There were
some technical issues during the production, a cooling liquid fell into the beer maturation
tank. Unfortunately, the traceability to recall the damaged products was not as fast and as
precise as necessary, and it ended up being a tragedy with multiple hospitalized and even
died. (Interviewee B)
It requires excellent reverse logistics to know in real-time what products were sold to
each client and do a proper recall to avoid putting customers' health at risk. And it should even
be compulsory, especially when it comes to food and beverage products. This is one of the
greatest strengths of LogTech B. All the tracking is precise, process by process, from the
brewery to the final customer.
If a taste or texture variation could affect the essence of the product and the brand, it is
also possible to recall that specific lot.

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Information flow
In a city where the craft beer culture is solid, they started with asset tracking, studied, and
detected the problem. As a developer, they proposed asset tracking software. They entered the
market and saw that it still lacks specific solutions; it is a market with many peculiarities in terms
of management, not only in the logistics part but also in the commercial part. It was an excellent
opportunity.
LogTech B carried out a study that shows that:
a small brewery today loses an average of 13% of the number of barrels annually. It is an
expressive amount of loss. Many micro or small-sized breweries lost their control on the
distribution stage, and this is how the losses are very high. They sell the barrels, but there
is a lot of commercial part, planning and logisitics that the owners do not manage. The
traceability solutions eliminate this problem with high rates of accuracy. It makes them
know where exactly those assets are. (Interviewee B)
The warehouses depend on each brewery, single physical space or several factories, own
distribution, outsourced distributors, integrated system. The customers and their stakeholders
(distributors, bars, sales points) access the system and manage to view the same information in
real-time. Thus, each user knows when to have products available, quantity, presentation, and
other relevant information.

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LogTech C – International trade business intelligence platform
Management
LogTech C is a foreign trade intelligence platform that mainly seeks importers to manage
the complexity of the supply chain in the section of international transport logistics. The platform
gathers import data that usually comes from international commerce, and governmental
platforms, with the data processed in transactional or foreign trade or from the importer himself.
Shippers work with sophisticated platforms, ecomex, dispatchers, transactional platforms for
customs documents, dispatches. Unfortunately, the day-to-day management software for
companies is not very practical for foreign trade management.
LogTech C was founded by a group of specialists with a combined expertise of more than
two decades in integrated solutions. With a comprehensive and efficient performance, constantly
seeking the best solutions for each step – whether tax, legal, customs, financial, or any other – it
established a strong vision for the business, give rise to a management tool that matured into the
firm it is today. LogTech C has determined the following insights during the course of more than
two decades of work in different international commerce sectors:
- Logistics operations are growing more complex as they evolve.
- This is not supported by traditional ERPs because they are not focused on foreign trade.
- Management strategies do not do not adapt to each client’s operations, which makes the
process difficult and raises logistics costs.
To overcome these challenges, LogTech C developed a international business intelligence
with the following functionalities:
- Traceability and transparency

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- Automatic KPIs
- Business intelligence combined with automoated KPIs
The online platform provides its users a mapping of the they buy, their volumes, freight
conditions and analysis of the shipping profile. Suppliers can also be mapped according to the
value of goods and quantity of imported shipments, all the results separated by continents,
countries and exporters. The precision of details is at the item level in terms of costs and times.
LogTech C presents information about costs and deadlines in a simple and complete way.
It is possible to view the logistics costs of the entire operation, separated by recoverable and non-
recoverable taxes. The deadlines are shown by event phase, whether on arrival, clearance,
delivery and arrival.
LogTech C also presents a mapping for demurrage, monitoring and visibility of
containers in real-time. Thanks to continuous follow-up, free times can be negotiated according
to the route, freight forwarder and shipowner, and program alerts when there is a risk of
demurrage.
All the operations generate historical records, which keep improving the future results.
Automatic reports are generated for control and analysis of past operations (LogTech C online
source).
It is reflected in the company's mission the enormous challenge the company has to break
traditional and inefficient working cultural companies have been doing for several years.
Those are analog processes that must be digitalized. Tenders, for example. Supply Chain,
Procurement and Finance are not in synergy. There is also a lack of synergy between the
Supply Chain, Procurement, and Finance departments within the company. Sometimes
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Procurement do not know what it is buying, it only depends on de SC description. Supply
Chain decisions are based on a photograph of the last three months. But international
commerce is dynamic.
Companies come from a culture of stratified and fixed prices. As if a container is
a 40ft commodity, rate x, 28 days demurrage pays x, and so on. But many times, it is not
possible to take efficient decisions based on static assumptions. Companies still do not
understand that this has changed. (Interviewee C)
Next steps
Today, we are concentrating efforts on developing an algorithm with predictive
functionality, to add forecasts to the platform. It is difficult considering the great
complexity due to the dynamism of the markets. (Interviewee C)
Another feature that is being developed is an artificial intelligence tool for data capture to
quickly identify and process information contained in documents like PDFs and invoices.
Furthermore, stick with the expansion plan more aggressively, taking advantage of the
positive momentum. LogTech C will seek to enter foreign markets considering the global scope
of the tool.
Opportunities
The main markets in which the company operates are automobilist, mainly auto parts,
machines and components, chemicals and retail. The vast majority involve complex logistics
chains, with many items, suppliers, invoices, orders, that results to be difficult to manage
manually. By contrast, commodities chain, for example, is of low complexity in terms of control
and tracing.
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LogTech C is fully convinced that in the future, all companies must adopt this tool in
order to be competitive.
This tool is the future, but today represents the breaking of cultural paradigms. The
pandemic shook every business to some extent. However, specifically, logistics was hit
hard like never before. After that phenomenon, some studies said globalization failed or
was a success, totally antagonistic views. According to LogTech C founder, what
happened is an irreversible process; more and more inserted in supply chains should be
global and real-time. He remarked that in his opinion, logistics is still in the stone age, it
continues to be managed as it was 30 years ago, and that has to change.
Companies are used to summarize the last months' results and, based on that, set
objectives, price, routes, times, and other criteria. However, international commerce is a
fluid scenario; stratified and fixed price does not match anymore. (Interviewee C)
Therefore, LogTech C's objective is to show their customers this perspective to take
advantage of the tool offered.
The way companies buy from abroad will have to change; they will be turned away by
disability prices. One of the advantages of the platform is that it provides updated
information in real-time. (Interviewee C)
Now LogTech C is working on making forecasts, too. In this way, besides showing a full
context through past data, it will also predict possible scenarios with accuracy.
In Brazil, there is no direct competition. Several companies offer data reports, but none
with that critical and intelligent analysis essential for decision making. LogTech C's target
market is not Brazil only. That is why they consider the main competitor is a company located in
the United States.

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In 2018 the model was based on consulting services. However, they pivoted in 2019
towards the business intelligence platform. Today, 95% of the income comes from the platform.
The company continues to grow steadily, without sudden changes but with great potential
scalability.
Challenges
An obstacle the company faces is the long sales cycle. Usually, the potential customers
are impressed with the tool and its functionalities through a diagnosis demo. However, the
conversion takes time. Many companies resist adopting the tool, are cautious, and do not want to
be considered inefficient.
More than 60% of the approached potential customers accept the diagnosis, but later, the
process of being convinced that the tool is essential, that it is not just one more, becomes long.
The main one is the barrier to entry with the client, the client's aversion to radical changes
in the way they work. In Brazil, in the sector of logistics operators, warehouse operations, and
imports, deeply inherent practices did not evolve at the same rate as the business world has been
doing.
Companies created this dynamic that has been decades where they regulate events and do
not see the bigger picture, and where the crucial decisions are needed to be made. Comparing
events is not a guarantee that the company is working efficiently.
The dynamics of this industry is bad, stressed, where the customer is on one side, is being
deceived by the service provider who is on the other side. Purchasing tries to get the best
deal with the service provider. Companies created this dynamic that has been around for
20 years where they regulate events.

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A large company can say, I am sure that I pay the lowest freight on the market,
lowest dispatch cost in the market, lowest terminal. They believe that because they have
highly sophisticated purchasing processes, negotiations, it makes a funnel and passes
several suppliers, but it is with the focus on regulating an event and you're not seeing if
that's the event you should actually compare. So, it is a very big change, to look at the
whole picture and see if what you are doing is really the best way to do it. The fact of
buying an event well, is not a guarantee that it will work in the most efficient way.
(Interviewee C)
During 2020, the pandemic affected the company considerably and was reflected in the
stoppage of new conversions. 2021 was already more stable but still with some repercussions of
the pandemic. It is still difficult to make new conversions because the potential customers are
also getting more stable, and investing in a new logistics technology is not part of their priorities.
Therefore, many of the companies approached prefer to be recontacted next year to analyze the
possibility of adopting the tool.
Material flow
Transactional software only shows the events that are being reported, that is, invoices,
transportation documentation, values, origin information, ports, and others. However, no tool
helps the company and the day-to-day analyst to understand the quality of the events created.
With that, the day-to-day management is only reactive; the analyst is constantly reacting to
things. They do not have the time or the tool to analyze the quality of the operations they are
executing.
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The LogTech C tool works above all these other tools, capturing that data, treating this
data, organizing in the form of indicators through customer business intelligence. It gives
transparency of everything happening in terms of costs and deadlines until the level of items.
The first step of the process is a diagnosis of operations. Once the customer data is
organized, the tool lags behind processing various possible scenarios for decision
making. For example, it is possible to analyze how a specific operation was from
Germany to Brazil in the last six months. The tool criticizes the operation from a
logistical efficiency point of view. It shows how it could have been done differently and
with a cost and time reduction. The tool brings the possibility of receiving comparatives
of how it is performing. The client knows his operation well, only of his own; on the
other hand, the tool gives referential prices, deadlines, freight, and services, from global
data. (Interviewee C)
However, international commerce is very dynamic; most companies do not have the
tools to carry out these analyses.
Information flow
The tool was programmed and parametrized based on the experience of foreign trade
professionals. However, on the platform, the customers automatically receive the analysis in
real-time.
Nowadays, we try to co-create with the client, we do not develop the tool alone. We
listen to the customer, we develop the functionality to address the customer’s need, and
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we finally bring it to the market. It is a collaborative process of innovation, brought by
the customer, not pushed to the market. (Interviewee C)
LogTech C has reduced its customers' logistics costs between 5 and 30% as a measurable
result. “The logic of its value proposition is, to make the diagnosis, the diagnosis derives an
optimization proposal, the optimization brings efficiency, and finally, that efficiency brings cost
savings” (Interviewee C).
The more noticeable benefit is a reduction in logistics cost. This is given by reducing the
number of events, shipments and, consequently, a cost reduction. There are many fixed costs
relative to each shipment, dispatch, docu mentation fees, imports; a series of small costs, but they
make a big difference when summed together.
Nowadays, companies are more aware of the responsibility in stopping climate change,
and through more efficient logistics, the carbon footprint is considerably reduced. “This is also in
an early stage, but in the coming years, regulations will be tougher, and all companies will have
to adapt and reduce the impact on the environment” (Interviewee C).

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Interviewed LogTechs logistics 4.0 dimensions
Table 3. Interviewed LogTechs logistics 4.0 dimensions
LogTech B - Beer industry logistics LogTech C - International trade

LogTech A - WMS platform
management business intelligence platform
It is planned to invest 12% of the Innovation is always present because It is reflected in the company's mission
turnover in innovation and to explore of the environment in which the the enormous challenge the company has
the use of drones for inventory company operates; they have the to break traditional and inefficient
Management processes. opportunity to interact with other working cultural companies have been
technology companies in the hub. It doing for several years. Those are analog
contributes so that the company never processes that must be digitalized.
stops innovating and developing.
The company offers asset traceability, Tracking is done within the border of The events that are being reported, that
mainly RFID technology is the factory, production, packaging, is, invoices, transportation
implemented. Also sensing tags, QR washing, dispatch, and when it goes to documentation, values, origin
codes, considering the lower the customer facilities. RFID, low information, ports, and others.
investment required. energy sensors, and Bluetooth. So far,
the results showed that the most
Flow of materials
efficient that works for breweries is the
barcode. It requires excellent reverse
logistics to know in real-time what
products were sold to each client and
do a proper recall to avoid putting
customers' health at risk.
89
LogTech B - Beer industry LogTech C - International trade

LogTech A - WMS platform
logistics management business intelligence platform
The access can be done from any Small brewery today loses an The LogTech C tool works above all
PC, Android, and iOS devices, average of 13% of the number of these other tools, capturing that data,
almost from any smartphone. The barrels annually. The customers treating this data, organizing in the
clients have productivity control and their stakeholders (distributors, form of indicators through customer
within the solution through a bars, sales points) access the system business intelligence. LogTech C has
Flow of information gamification strategy to engage and and manage to view the same reduced its customers' logistics costs
motivate users. A study carried out information in real-time. Thus, each between 5 and 30% as a measurable
by the implementation team user knows when to have products result.
showed an efficiency increment of available, quantity, presentation,
20.7%, under the Lean framework and other relevant information.
for analysis.
Source: own work
90
Challenges faced by interviewed LogTechs
Table 4. Challenges faced by interviewed LogTechs
LogTech A LogTech B LogTech C
- LogTech A considers - LogTech B, shows a certain - LogTech C projects to use

it a great challenge to level of weakness when machine learning to add
find qualified labor. talking about management, forecasting functionalities.
However, they are considering that the company However, it is a complex to
satisfied with the formed is growing, and the company develop, and it have not
team. structure is not fully been lauch yet.
- The pandemic hit delimited. The company is - Many potential clients
operations, smaller nowadays taking part of a feel exposed when sharing
clients suspended business development information about their
services. program by an accelerator company's operations,
- For any technology company to address this fearing to demonstrate a
company is a great issue. certain level of inefficiency.
challenge to keep up-to- - Pandemic dramatically - Regardless of the results,
Challenges
date or even ahead in the impacted on LogTech B other potential clients
market. operations, considering the directly reject a significant
fact that bars and restaurants change. They prefer to stick
were closed during the with their traditional
lockdown. practices, trusting that it
- Many breweries are family remains the most efficient.
business or small businesses - In addition to the clients,
formed by 2 or 3 people that the entire network of
intend to assume all stakeholders is very
responsibilities, are used to attached to old practices,
traditional practices and are which LogTech C already
reluctant to adopt new considers obsolete.
technologies.
Source: own work
91
Industry 4.0 technologies adopted by interviewed LogTechs
Table 5. Industry 4.0 technologies adopted by interviewed LogTechs
Company LogTech A LogTech B LogTech C
3D Printing
Artificial Intelligence x
Big data analytics x x x
Blockchain
Internet of Things x x x
Machine Learning
Robotic Systems
Source: own work

92
Discussion
By conducting a literature review, it was possible to identify multiple technologies
applied to logistics operations. However, we were able to identify a significantly smaller number
of them in the interviews.
Among those that we find in common throughout the cases are the RFDI, web
management platforms with updated information in real-time, intelligent data analysis.
Some LogTechs focus on one or two technologies leaving behind a great variety of
technological solutions to be explored. They should be considered to develop the three
dimensions of logistics: management, material flow, and information flow.
Unlike the large multinationals that allocate an exclusive team to the development and
implementation of a 4.0 Logistics plan, for start-ups it represents a great challenge. At this point,
it is worth highlighting the important role played by innovation hubs and accelerators.
LogTech A – WMS platform brings out the best in itself through co-creation with its
clients and the adaptability it offers. With traceability devices connected with its web platform, it
offers accurate information in real-time, not only in its warehouse, as the definition of "WMS"
says, but throughout your supply chain. Also, the gaming mode in which it achieves the
motivation and engagement of the users. Nevertheless, the company could develop its full
potential by adopting “smart warehouse” technologies as robotics for handling, picking and
packing of goods, artificial intelligence and augmented reality.
LogTech B – Beer industry logistics management, offers a comprehensive and a solution
for the specific market it is intended for, the brewing industry. The company offers precise
control of operations before, during, and after production, thus counteracting the most common
weaknesses that were detected in the logistics chain of the craft beer industry. Taking into
93
account that these are mass consumption goods, they identified the importance of keeping strict
control of the traceability of the goods. To do this, they found the most economical and effective
alternative, replacing RFDI with QR codes. On the other hand, LogTech B, shows a certain level
of weakness when talking about management, considering that the company is growing and the
company structure is not fully delimited. The company is nowadays taking part of a business
development program by an accelerator company to address this issue.
LogTech C – International trade business intelligence platform, it breaks with paradigms
deeply rooted in certain logistics operations and seeks to think outside the box, which is why its
main challenge today represents the rejection of change by many potential customers. The tool
they offer offers great detail of information and analysis based on past operations and in real
time. On the other hand, it is considered that there is great potential in the company to develop
forecasts and projections based on the data obtained in combination with artificial intelligence,
specifically it could be with machine learning. As mentioned by the CEO, in fact it is already in
the plans being developed.
Now, approaching the analysis by logistics 4.0 dimension, in management it is clear that
all the LogTechs evaluated, recognize the importance of the role of innovation in their results
and are committed to continue innovating. In addition, starting from scratch is a challenge for
any startup, one of the LogTechs receives the support of an accelerator to formally structure
itself and continue growing. The three startups face the rejection of change and the adoption of
new technologies by potential consumers.
In material flow dimension technologies as RFID, QR codes and Internet of Things for
general cargo or final goods are mentioned. However, unlike what was developed during the
94
literature review, technologies that require larger investments such as robotics or augmented
reality were not mentioned.
And finally, information involves the application of tools such as data analytics, artificial
intelligence and cloud computing within the analyzed LogTechs operations. Machine learning
and blockchain were not adopted yet.
The cases present different levels of maturity in each dimension. Moreover, the three
cases have in common that they focus on a few technologies to be applied, some more than
others. However, as mentioned during the review of the existing literature, there are a large
number of new technological tools that can be taken advantage of. The logistics 4.0 roadmap
should consider creating an environment with smart solutions that cover the whole picture. Also
encompassing the three dimensions in which Oleskow-Szlapka and Stachowiak (2019) divide the
logistics concept: management, material flow and information flow.
It was also determined that LogTechs face several challenges from different nature. The
three of them mentioned that the pandemic represented a challenge, although some were
significantly more impacted than others. another common challenge was the initial rejection by
potential clients. Customers prefer to stick with their traditional practices, trusting that it remains
the most efficient way to work, even when some of them are already obsolete nowadays.
From the technologies studied throughout the literature review, artificial intelligence, big
data analytics and Internet of Things were easily identified. On the other hand, machine learning,
Robotic Systems, 3D Printing and blockchain were not specifically mentioned.

95
Conclusions
After reviewing the existing literature, it was possible to conceptually identify the leading
technologies being applied in logistics operations worldwide. It was possible to explain its
operation, advantages, and disadvantages in its application and specifically in which processes
are beneficial within the supply chain.
Interviewing three founders and representatives of Brazilian LogTechs allowed to answer
the second question established for this study, how start-ups are applying Logistics 4.0
technologies. The three of them work with a management platform such as Saas, ERP, and WMS
programs. The main traceability tools include RFDI, and barcodes or QR codes are also more
widely accepted today. The application of these technologies brings a series of advantages for
users, the main one of which could be reducing logistics costs. This shows that current logistics
operations are mostly relatively inefficient but remain acceptable.
To explain this inefficiency that was identified, it seems that the most significant obstacle
is in small or medium-sized business managers or decision-makers -sometimes even in large
business- who refuse to accept radical changes in the adoption of new technologies. Therefore,
the greatest challenge arises from this, how to make this change in work culture and make room
for the new tools available thanks to new technologies. This was the main risk, detected in the
three cases analyzed.
Another common challenge was the effect of the pandemic on LogTechs. LogTech B,
which has more physical operation, was hit the hardest. However, LogTechs A and C, whose
main product is an online platform, were less affected. This also shows us that the number of
tasks and operations that are migrating to the digital world is increasing. However, when dealing
with the distribution of products, some tasks inevitably continue to be physical.

96
The results provide a general idea of how a large number of start-ups are emerging that
take advantage of the excellent results of new technologies combined with innovative
management ideas. In addition, information was obtained from the Logtechs representatives
about the main problems in logistics reported by customers and what solutions they offer to
counteract them. Moreover, what opportunities and challenges represent these business models
as entrepreneurs in Brazil. Despite the backwardness in innovation of the entire Latin American
region, the presence of São Paulo as the only Latin American city in an important ranking of
innovation environments is noteworthy and promising for the growth of startups in Brazil. The
role of incubators and accelerators of business ideas to promote and boost entrepreneurship was
also highlighted.
Entrepreneurs usually manage to identify a specific need in the market; in this case, the
great challenge proposed by logistics in Brazil. Firstly, they decide to apply a specific
technological solution to operations to make them more efficient. However, it should not stop
there; the company must have a detailed roadmap that allows it to develop all the dimensions of
Logistics 4.0. One of the Logistics 4.0 foundations is interconnectivity in order to create those
cyber-physical integrated environments.
It is important to highlight that the sample was small and may not represent the
performance of a large part of other LogTechs in Brazil.
In this opportunity, the objective was to delve into specific LogTechs operations, explore
their technologies adoptions and the challenges they are facing. However, it would be of great
value for future investigations to do a larger-scale analysis with quantitative data encompassing
LogTechs in Brazil. Perhaps a guideline for entrepreneurs to overcome the great challenges to
running a LogTech in Latin America.

97
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FUNDAÇÃO GETULIO VARGAS

ESCOLA DE ADMINISTRAÇÃO DE EMPRESAS DE SÃO PAULO

NATALIA MARÍA OJEDA LARROSA

LOGTECHS IN BRAZIL: HOW LOGISTICS START-UPS ARE APPLYING

INDUSTRY 4.0 TECHNOLOGIES. A MULTI-CASE STUDY

LOGTECHS IN BRAZIL: HOW LOGISTICS START-UPS ARE APPLYING

INDUSTRY 4.0 TECHNOLOGIES. A MULTI-CASE STUDY

Thesis presented to Escola de Administração

Knowledge field: Internationalization of

Adviser: Prof. Dr. André Cherubini Alves

Orientador: André Cherubini Alves.

1. Empresas novas. 2. Logística empresarial. 3. Inovações tecnológicas. 4.

LOGTECHS IN BRAZIL: HOW LOGISTICS START-UPS ARE APPLYING

INDUSTRY 4.0 TECHNOLOGIES. A MULTI-CASE STUDY

Thesis presented to Escola de Administração

logistics start-ups in Brazil, which are also called LogTechs.

Design/methodology/approach – It is qualitative research, analyzed through case studies. To

challenges faced by Logtechs in Brazil.

are analyzed in successful cases of Brazilian Logtech companies.

Keywords – Industry 4.0, Logistics 4.0, Logtechs.

adotadas por startups de logística no Brasil, também chamadas de LogTechs.

Desenho / metodologia / abordagem - É uma pesquisa qualitativa, analisada por meio de

ou representantes das start-ups. Um estudo multi-caso permite a exploração das diferentes

ferramentas existentes para otimizar as operações logísticas e a análise de casos específicos de

Resultados - A pesquisa fornece insights significativos sobre as ferramentas da Indústria 4.0

para otimizar os processos de logística e como as empresas LogTechs no Brasil as estão

aplicando. Além disso, descreve os desafios enfrentados pela Logtechs no Brasil.

são analisados em casos de sucesso de empresas Logtech brasileiras.

Palavras-chave - Indústria 4.0, Logística 4.0, Logtechs.

Aims and Objectives 18

Industry 4.0 definitions 21

Industry evolution path 22

First industry revolution 23

Second industry revolution 23

Third industry revolution 24

Industry 4.0 technologies 25

Artificial Intelligence (AI) 27

Big data analytics 28

Internet of Things (IoT) 30

Principles and fundamental of Industry 4.0 31

Logistics 4.0 development path 34

Advantages and disadvantages of Logistics 4.0 39

Logistics 4.0 common applications 40

Technological impact on logistics 44

Logistics 4.0 evaluation model 46

The role of startups in the economy and development 50

Covid impact on LogTechs 57

Challenges LogTechs face 59

The role of incubators and accelerators 59

LogTech A – WMS platform 67

Concept of the company 67

Industry 4.0 technologies applied to manage products and materials 70

Benefits and results 71

Industry 4.0 technologies applied to manage information 71

Benefits and results 72

LogTech B – Beer industry logistics management 73

Concept of the company 73

Industry 4.0 technologies applied to manage products and materials 77

Benefits and results 78

Industry 4.0 technologies applied to manage information 79

Benefits and results 79

LogTech C – International trade business intelligence platform 80

Concept of the company 80

Industry 4.0 technologies applied to manage products and materials 85