Physical Internet: Towards a Sustainable, Digital, and Smart Logistics

Introduction
In recent years, digital innovation and sustainability have become essential pillars in the transformation of the logistics sector. In this context, the concept of the Physical Internet (PI) is emerging as one of the most significant and strategic developments at an international level. Inspired by the functioning of the Internet, PI proposes a modular, interconnected, and cooperative logistics system, where goods and resources move with the same efficiency and transparency as data in the digital world.

This vision is no longer just theoretical: it is becoming reality thanks to advanced technological solutions that embody the principles of the Physical Internet. In Italy, the TrackOne platform stands out as one of the key enablers of this innovative paradigm, bridging theory and practice. TrackOne integrates cutting-edge technologies such as IoT (Internet of Things), Artificial Intelligence, blockchain, and interoperability standards (such as GS1, EPCIS, EDI), offering real-time and advanced control over the supply chain.

Thanks to this platform, Italian companies can now monitor environmental conditions during transport, track assets throughout the logistics cycle, optimize processes, and reduce CO₂ emissions—thus enabling a more sustainable, resilient, and digital logistics model.

This article explores concrete case studies that demonstrate how the Physical Internet is already transforming the industrial landscape in Italy and Europe. We’ll see how the adoption of interoperable and intelligent systems is improving efficiency, transparency, and sustainability in critical sectors like pharmaceuticals, manufacturing, and agri-food.

Through practical examples, technical analysis, and measurable benefits, it becomes clear that implementing the Physical Internet—enabled by solutions like TrackOne—is no longer a future vision, but a present-day strategy shaping tomorrow’s logistics.

Current Logistics System Inefficiencies: Why a New Model Is Needed

The traditional logistics system today clearly shows its limits in meeting the modern market’s needs for efficiency, resilience, and sustainability. Fragmented models, analog information management, and a lack of supply chain visibility generate waste, delays, and unacceptable environmental impacts.

Inefficient Use of Transportation Vehicles

One of the most serious problems in current logistics is the underutilization of vehicles. According to European data, over 25% of vehicles travel empty, and more than 50% do not fully use available cargo space. This results in:

fuel and time waste;
increased CO₂ emissions;
traffic congestion;
higher operational costs for companies.

Without tools for load sharing or dynamic route optimization, logistics remain misaligned with principles of efficiency and environmental responsibility.

Information Silos and Lack of System Interoperability

Another structural cause of inefficiency is the lack of interoperability among IT systems. Most companies use proprietary software or non-standard formats, making it difficult to share data across the supply chain.

Direct consequences include:

limited real-time visibility;
poor coordination between suppliers, carriers, and customers;
planning and order management errors;
slow response times during unexpected events.

Without interoperable data foundations, supply chains remain opaque and unresponsive.

Lack of Traceability and Visibility in the Supply Chain

Another key inefficiency is the lack of real-time traceability. Information about shipment status, environmental conditions of products, or asset locations is often incomplete or outdated.

This leads to:

undetected delays;
inability to identify responsibility for damage or loss;
reduced service quality for the end customer.

Logistics visibility is now a critical factor for competitiveness, yet many companies still lack it.

Rigid Logistics Networks and Lack of Flexibility

Today’s logistics networks are designed for stable, predictable scenarios. However, in an era of frequent crises (pandemics, wars, climate events), the lack of resilience becomes a major weakness.

Characteristics of inflexible logistics networks include:

inability to reconfigure flows based on demand;
reliance on few suppliers or centralized hubs;
slow reaction times to unexpected events.

A more modular, decentralized, and adaptive system is needed—one that can absorb external shocks.

Environmental Impact of Traditional Logistics

The logistics sector is among the leading contributors to greenhouse gas emissions, especially due to road transport. Major environmental issues linked to conventional logistics include:

widespread use of polluting vehicles;
lack of effective intermodality (road-rail-sea integration);
excessive use of single-use packaging;
energy waste throughout the supply chain.

A sustainable logistics model requires a radical rethink of operational practices.

Finally, logistics inefficiencies also carry a social cost. Workers, especially those in last-mile delivery, face:

irregular hours and high pressure;
low profit margins and poor wages;
health and safety risks, especially during seasonal peaks.

Improving logistics is not only a matter of technology, but also of rights and work quality.

Why a Paradigm Shift Is Needed: The Role of the Physical Internet

In this scenario of widespread challenges, the Physical Internet (PI) emerges as an innovative and systemic solution. With its modular, interconnected, and standardized logic, PI enables:

sharing of logistics resources and reduction of empty runs;
full real-time visibility of the supply chain;
proactive responses to demand variations or external events;
reduced emissions and transportation costs;
fair and transparent logistics for all stakeholders.

In this context, the TrackOne platform represents a concrete example of Physical Internet implementation in Italy, thanks to the integration of IoT, AI, blockchain, and interoperability standards (GS1, EPCIS, EDI).

What Is the Physical Internet?

The Physical Internet is a new paradigm for sustainable and interconnected logistics, inspired by how the digital Internet operates. At its core are four key concepts: modularity, openness, sharing, and flow optimization.

More specifically, the Physical Internet aims to revolutionize the way goods, data, and logistics resources are moved, by proposing an intelligent global network capable of overcoming the limitations of traditional models.

Operational Pillars of the Physical Internet

Here’s how this innovative approach translates into action within the supply chain:

Logistical modularity: all goods are moved in standardized, modular units (PI-containers), compatible with every transport mode and infrastructure.
Sharing of physical resources: warehouses, vehicles, and hubs are used collaboratively, allowing for optimized loads and fewer empty trips.
Digital interoperability: common communication and traceability protocols (e.g., GS1, EPCIS) are adopted, enabling seamless data exchange among all supply chain actors.
Intelligent logistics network: shipments are routed through a distributed network of PI-hubs—intelligent nodes that manage flows much like routers handle data packets online.

A More Efficient, Transparent, and Sustainable Logistics

The ultimate goal of the Physical Internet is to transform global logistics into a dynamic, interconnected, and highly efficient network capable of:

ensuring real-time transparency and visibility;
quickly adapting to market changes;
significantly reducing emissions, waste, and operational costs;
improving collaboration between companies throughout the entire supply chain.

This vision is increasingly becoming a reality thanks to advanced platforms like TrackOne, which enables practical deployment of the Physical Internet through the integration of IoT, blockchain, AI, and standardized interoperability.

How It Works: Inspired by the Digital Network

On the web, every message is divided into packets autonomously routed through a decentralized network. Each node (router) chooses the best path based on shared rules.

In the Physical Internet, goods are treated as physical packets contained in standardized units called PI-containers, which can be combined like modular building blocks. PI-hubs, the physical equivalent of routers, receive, sort, and reassemble containers to optimize transport.

Thanks to this infrastructure, shipments no longer need to follow a fixed A-to-B route—they can be routed dynamically based on transport availability, costs, environmental constraints, and operational priorities.

Enabling Technologies

The success of the Physical Internet depends on the integration of advanced digital technologies. Among the most relevant are:

Internet of Things (IoT): enables constant monitoring of environmental conditions, location, and status of each logistics asset.
Blockchain: ensures immutability and transparency of data shared among different stakeholders.
Artificial Intelligence (AI): allows optimization of routes, demand forecasting, and proactive intervention in case of anomalies.
GS1 / EPCIS / EDI Standards: guarantee semantic and syntactic interoperability between systems used by different players.

The TrackOne platform integrates all these technologies into a unified digital ecosystem.

TrackOne: An Enabling Platform for the Physical Internet

Within the evolution toward the Physical Internet, TrackOne stands out as a concrete and advanced enabler for smarter, more transparent, and more sustainable logistics.

TrackOne is designed to transform traditional supply chains into interconnected digital ecosystems by integrating next-generation technologies such as IoT, blockchain, artificial intelligence (AI), and international interoperability standards (GS1, EPCIS, EDI).

Key Features of TrackOne for a Smart Supply Chain

TrackOne provides a comprehensive suite of features that support the operational implementation of the PI model:

Real-time Environmental Monitoring
The platform continuously detects temperature, humidity, shocks, unauthorized openings, and other critical parameters across the entire logistics chain.
Multilevel Traceability and Advanced Geolocation
Every asset—from containers to individual packages—can be tracked across every supply chain node, providing end-to-end visibility and real-time updates.
Digital Interoperability
Through the adoption of globally recognized standards (GS1, EPCIS, EDI), TrackOne easily integrates with existing ERP, WMS, and TMS systems, ensuring smooth communication among diverse actors.
Predictive Analytics and Proactive Event Management
AI applied to the supply chain allows anticipation of issues, route optimization, and better resource allocation.
Emission Reduction and Process Optimization
Load consolidation and integrated logistics resource management lead to a significant reduction in CO₂ emissions and increased operational efficiency.

Strategic Benefits of the TrackOne Platform

Adopting TrackOne enables companies to achieve measurable improvements across multiple areas:

Higher quality and reliability of logistics data
Increased security and transparency along the entire supply chain
Reduced operational costs related to delays, losses, and waste
Regulatory compliance in highly regulated sectors (e.g., pharmaceutical, food)
Enhanced customer satisfaction through timely and traceable deliveries

TrackOne as a Catalyst for the Physical Internet in Italy

In the Italian landscape, TrackOne has established itself as one of the most advanced tools for the concrete implementation of the Physical Internet. Its modular and scalable architecture makes it suitable for businesses of all sizes and sectors, enabling the digital transformation of logistics in a:

sustainable,
collaborative,
and resilient way.

Thanks to TrackOne, the concept of connected, predictive, and sustainable logistics is no longer a vision of the future, but a current reality for public and private companies seeking to lead change in the supply chain.

Tangible Benefits of the Physical Internet for the Supply Chain

The adoption of the Physical Internet (PI) model, supported by advanced technologies like TrackOne, brings measurable benefits throughout the logistics value chain. These advantages are not merely theoretical—they have already been confirmed through numerous real-world applications across various industries.

Using a modular, interoperable, and connected approach, the Physical Internet transforms logistics processes with positive impacts on efficiency, sustainability, security, and competitiveness.

Operational Efficiency Optimization

One of PI’s main advantages is the overall improvement in logistics efficiency, enabled by:

sharing physical resources (vehicles, warehouses, containers)
reducing empty trips
dynamic and predictive transport planning
full visibility of logistics flows

Expected result: up to +40% efficiency compared to traditional logistics models.

Sustainable Logistics and Emission Reduction

Thanks to consolidated loads, route optimization, and cleaner transport modes, PI supports a more sustainable logistics model. Technologies like IoT and AI help reduce waste and energy consumption.

Environmental impact:

up to -60% in CO₂ emissions during distribution
reduction of single-use packaging and unnecessary handling

Less Urban Congestion and Traffic in Cities

PI enables smarter urban logistics by introducing:

local micro-hubs
lightweight and electric vehicles for last-mile delivery
shared use of existing infrastructure

Advantage: up to -30% reduction in urban congestion caused by commercial traffic.

Real-Time Visibility and End-to-End Traceability

With platforms like TrackOne, the supply chain becomes completely transparent. Companies can monitor:

the location of vehicles and containers in real-time
environmental conditions during transport (temperature, humidity, shocks)
delivery status and responsibility at critical handoffs

Benefit: full end-to-end traceability and improved service quality.

Reliable, Interoperable, and Secure Data

Integrating international standards (GS1, EPCIS, EDI) and blockchain ensures that shared data is:

reliable and tamper-proof
interpretable across different systems
accessible transparently and in compliance with regulations

Consequence: greater security in logistics transactions and contractual relationships.

Improved Experience for Businesses and Customers

The Physical Internet also provides benefits in terms of:

faster and more accurate deliveries
lower overall logistics costs
increased responsiveness to demand changes

Final result: more satisfied customers, more engaged partners, and a more resilient supply chain.

Summary: Strategic Benefits of the Physical Internet

Towards a Collaborative and Circular Logistics

The Physical Internet promotes a logistics economy based on access, not exclusive ownership. Warehouses, fleets, and data become shared assets, available when needed.

This requires a new corporate culture:

Cooperation among competitors to maximize collective efficiency
Trust in secure data sharing through blockchain
Incentives for sustainability and waste reduction

Logistics is no longer a cost center—it becomes a strategic asset.

Physical Internet for All: Businesses, Citizens, Territories

The value of the Physical Internet extends beyond technological transformation of businesses. It represents a systemic shift, generating concrete benefits for the entire economic and social ecosystem: companies, consumers, and territories.

This collaborative and sustainable vision of logistics fosters more inclusive, transparent, and efficient supply chains—enhancing the quality of life in cities and industrial zones alike.

For Businesses: Digitization, Efficiency, and Competitiveness

Companies adopting the PI paradigm gain multiple strategic advantages:

access to shared logistics networks to reduce costs and increase flexibility
full digitalization of the supply chain with real-time flow visibility
faster response to demand peaks or supply chain disruptions
improved compliance in regulated sectors (e.g., food, pharma)
enhanced brand reputation through sustainability efforts

Outcomes: improved competitiveness, reduced risk, and more resilient processes.

For Citizens: Faster Deliveries, Less Traffic, Cleaner Air

The Physical Internet also brings smarter urban logistics with visible benefits in citizens’ daily lives:

reduced commercial traffic thanks to consolidated deliveries
use of eco-friendly vehicles (cargo bikes, electric vans)
more punctual deliveries even in dense residential areas
better access to last-mile logistics services
reduced air and noise pollution in neighborhoods

A logistics model designed for collective well-being and environmental health.

For Territories: Sustainability, Innovation, and Attractiveness

At the regional level, PI enables the creation of cohesive logistics networks that enhance local resources. Key benefits include:

development of smart, intermodal, and interoperable logistics hubs
integration of industrial areas, logistics platforms, and production centers
promotion of digital innovation in manufacturing districts
attraction of investments thanks to smart and sustainable infrastructures
support for the circular economy and ecological transition

All of this strengthens the strategic role of regions in the new European logistics map.

Physical Internet: A Collective Opportunity

The Physical Internet represents a concrete opportunity for:

businesses, becoming more agile and sustainable
citizens, benefiting from faster services and less congested cities
territories, emerging as hubs of innovation and logistics attractiveness

In this scenario, platforms like TrackOne are key enablers of supply chain digital transformation—connecting public and private actors in a fluid, transparent, and secure ecosystem.

Conclusion: The Future Has Already Begun

The Physical Internet marks a radical paradigm shift that goes beyond simple digitalization. It’s a new infrastructure, a new mindset, a new way to collaborate.

Thanks to solutions like TrackOne, this vision is already becoming reality. Companies that invest in PI today will lead the logistics of the future: smarter, greener, and more competitive.

Sources:

Alice – Physical Internet

2. Pagina di Wikipedia

https://en.wikipedia.org/wiki/Physical_Internet

3. La Physical Internet: dall’intuizione dell’Economist ai primi business “disruptive” https://www.fitconsulting.it/la-physical-internet-dallintuizione-delleconomist-ai primi-business-disruptive/

4. Physical Internet Foundations

https://link.springer.com/chapter/10.1007/978-3-642-35852-4_10

5. The Physical Internet and Business Model Innovation

https://timreview.ca/sites/default/files/article_PDF/Montreuil_et_al_TIMReview_ June2012.pdf

6. Physical Internet: First results and next challenges

https://doi.org/10.1111/jbl.12268

7. TrackOne solution working principles and integration within the ATLAS platform https://youtu.be/608u3mgeQ7k