In today’s digital era, foreign trade has undergone a profound transformation, largely driven by the emergence of Big Data. Advanced analytical techniques and the processing of large volumes of data have become essential allies for companies seeking to boost their import and export capacity. But how is Big Data revolutionising foreign trade?
Perhaps before we get into the subject, we should clarify the concept that is the focus of today’s article. In simple terms, Big Data refers to a set of data that is so large and complex that it is difficult to process using traditional methods. The relevance of this phenomenon lies not only in the amount of data, but also in the potential offered by its analysis: to detect patterns, trends and correlations that can be exploited to the benefit of a company’s operations, such as imports.
The connection between Big Data and international trade
Foreign trade, with its complex web of regulations, logistics and relationships, generates immense volumes of data on a daily basis. From shipment tracking to demand patterns in specific markets, every piece of information can be crucial when making a purchase or sale. Here’s why.
- Supply chain optimisation: By analysing real-time data, companies can anticipate delays, identify inefficiencies and choose more effective transport routes. This optimisation not only saves costs (and aggravation, such as potential stock-outs), but also improves the customer experience by reducing delivery times.
- Risk analysis: Big Data enables companies to make comprehensive data-driven assessments, from identifying potentially problematic suppliers to forecasting geographic areas with emerging risks, such as political tensions or natural disasters.
- Customisation of supply: By understanding market demand through data analytics, companies can tailor their import and export offerings to the specific needs of their customers or niche markets.
- Regulatory compliance: With the constant change in regulations and standards, predictive analytics provided by Big Data can help companies anticipate and adapt to new requirements, ensuring that all operations are compliant with current regulations.
Is Artificial Intelligence the same as Big Data?
A few months ago we wrote an article on “how Artificial Intelligence is transforming import” and, although they are closely related concepts, there are key differences between them. As we said, Big Data refers to the management and analysis of large volumes of data, while artificial intelligence focuses on the development of intelligent systems capable of learning and making decisions based on that data. While Big Data focuses on the collection and processing of information, artificial intelligence focuses on the ability of machines to mimic human intelligence and work with that data to predict and automate future actions.
If we were to take these differences to an example, Big Data would allow us to collect all available information on watch purchases in China over the last 50 years, while Artificial Intelligence would draw its own conclusions on which are the best months to make these purchases and in what quantity, a task that a good sourcing partner should also be able to do.
Ethical Challenges and Considerations in the Age of Big Data
Despite the many advantages that Big Data can bring to foreign trade, the handling and analysis of large data sets comes with significant challenges (or even dangers). Data protection and privacy are a case in point.
Companies must guarantee the security of information and ensure that its use complies with data protection regulations. We cannot fall into the trap of thinking that any data can be used: doing so improperly can lead to heavy penalties.
At the same time, it is important to remember that although we take advantage of the benefits of technology, artificial intelligence or Big Data, we should not be overly dependent on algorithms and we should always encourage human thinking to participate in the process to obtain an appropriate interpretation.
In that sense, as a specialist procurement company, we pride ourselves on being at the forefront of this revolution, offering solutions and strategies that are data-driven but have people at the heart of their work. We want to ensure that our clients are always one step ahead in the dynamic world of foreign trade, harnessing both human potential and Big Data to achieve promising results.