How to Protect High-Value Inventories from Cargo Theft

As the global logistics and transportation industry becomes increasingly interconnected, cargo theft has soared to a 10-year high. According to a recent report, incidents increased 46% in the first quarter of 2024 compared to the first quarter in 2023.

This upsurge signals an urgent need for expanded security measures. In response, business leaders are adopting IoT monitoring of product location and condition to sustain agile supply chains that can withstand disruptions to maintain seamless logistical continuity. Central to supply chain resilience is visibility into the precise geographical coordinates of moving assets in real-time and proactive tactics and strategies to prevent cargo theft or resolve its consequences.

What Is Cargo Theft?

Cargo theft occurs when thieves misdirect freight away from the intended receiver by misrepresenting themselves as the operating authority. A network of fraudulent carriers nationwide is gathering intelligence on the shipping and receiving procedures for various well-known distribution centers. California, Florida, Georgia, Kentucky, and Texas are hotspots within that network.

Cargo theft typically involves the following targets:

• Locations: warehouses, platforms, depots, wharves, airports, container stations, distribution and consolidation facilities
• Vehicles: motor trucks, railroad cars, sea vessels, aircraft
• Containers: trailers, intermodal containers and chassis
  
  

Types of Cargo Theft

Straight cargo theft occurs when unattended freight that can be quickly and easily sold is physically stolen — typically at truck stops, parking lots, drop lots, and rail yards.

Strategic cargo theft involves the use of deceptive tactics to mislead legitimate carriers to redirect freight to counterfeit carriers — including business account seizures, fabricated pick-ups, identity theft, and double brokering fraud.

Cyber cargo theft occurs when hackers infiltrate digital networks to obtain sensitive data, which they subsequently exploit to intercept freight inconspicuously.

Cargo Theft Tactics

Cargo thieves employ sophisticated methods to execute their deception. The following tactics pose major challenges to tracking and recovering stolen freight.

Document forgery: Cargo thieves alter transportation and customs documents to disguise the illicit movement of freight across borders, disable the ability of companies to trace the origin and intended destination of freight, and confound legal efforts to arrest offenders and reclaim goods.

GPS jamming and spoofing: Cargo thieves use these tactics to map misleading trails or obscure the actual location of stolen cargo, thereby delaying response times and recovery efforts.

Cyber-attacks: Cargo thieves hack company websites to retrieve shipment details, schedules, and documents — for instance, they send employees a phishing email that installs Trojan Horse malware granting illegal access to a company’s legitimate shipping paperwork, which they then use to commit fraudulent pick-ups.

Impact of Cargo Theft on Supply Chain Logistics

Cargo theft causes direct financial damage by triggering systemic disturbances throughout the shipping industries. Each year, global business forgoes an estimated $1.6 trillion in revenue due to logistical interference.

Delayed deliveries: Cargo theft creates inefficiencies across the supply chain network that halt production lines and lead to significant delays for industries reliant on just-in-time delivery systems.

Inventory gaps: For businesses that promise 24/7 availability, empty shelves damage brand reputations and lead to customer dissatisfaction with goods and services, such as long waits for vaccines at clinics and pharmacies or perishable foods arriving spoiled at grocery and convenience stores.

Profit loss: Costs that arise from the need to replace stolen goods and pay increased insurance premiums can significantly affect a company’s bottom line.

Recommendations for Cargo Theft Mitigation

The following procedural tactics and technological strategies can help mitigate cargo theft for both the short- and long-term.

Procedural Tactics
These tactics are easy to implement and require only that security and logistics personnel incorporate them into their daily routines.

• Verify the identities of contractors when using online load boards. 
• Research motor carrier numbers and company contact information thoroughly through the FMCSA.
• Confirm positive identities of drivers, trucks, and trailers at point of pick up. 
• Ensure freight loads are never left unattended, especially at truck stops, drop lots, and rail yards. 
• Install high-security rear door, air cuff, and landing gear locks for any freight that may need to be left unattended for a short period. 
• Participate in the cargo security community and join cargo trade organizations for up-to-date news and tips. 
  
  

In addition to these procedural tactics, another option is to build redundancy into your supply chains — for instance, holding greater inventory volumes at retail stores or using multiple warehouses spread across different locations.

Technological Strategies
The sophistication of cargo theft methods requires a corresponding evolution in security strategies. Logistics and transportation companies are urged to adopt the following advanced technological solutions to counteract these threats.

• Enhanced verification processes: Implement rigorous checks and balances within the document verification process to identify discrepancies and prevent potential forgeries.
• Advanced tracking technology: Upgrade GPS and radio frequency identification (RFID) technologies to include tamper detection and enhanced encryption to counteract jamming and spoofing.
• Increased cybersecurity measures: Strengthen cybersecurity protocols, conduct regular security audits, and train staff to recognize potential cyber threats.
• Comprehensive security solution: Integrate end-to-end security solutions that safeguard goods, including physical, cyber, and logistical elements.
  
  

SmartSense Voyage: Protect your critical assets in motion

As the logistics and shipping industries continue to confront the escalating challenge of cargo theft, the need for a proactive and comprehensive approach has never been more critical. Sensing-as-a-Service solutions are crucial in safeguarding against future threats and maintaining the integrity of the logistics network.

SmartSense Voyage offers solutions that comply with strict regulatory requirements for storing, handling, transporting, and tracking high-value products. GPS/IoT-enabled asset tracking provides visibility into the real-time location of these assets to help companies avoid theft and loss while improving revenue:

• Supply chain: Track the location and condition of product with increased accuracy between distribution centers and stores.
• Information technology: Locate high-value assets when they are removed from the business.
• Loss prevention: Reduce cargo theft by pinpointing route deviations, unscheduled stops, and door openings.
  
  

At the heart of SmartSense Voyage is the T1 sensor.  Its ultra-compact size allows it to be placed in nearly any setting, whether on a trailer or a pallet of products.

Combined with the prescriptive workflows provided by the full SmartSense Sensing-as-a-Service solution, SmartSense Voyage enables new tracking possibilities and empowers businesses to take decisive action against cargo theft.