Changes in Last Mile Logistics as Omni-channel Supply Chains Begins to Blossom
Large scale e-commerce is not facing any immediate threats, freeing industry managers up to think about the logistical aspects of their business, and their attention is being directed towards last mile deliveries.
There has been a lot of discussion over how to innovate last mile deliveries—in order to attend to customer demands for convenient and speedy online orders, and as each innovation is made consumers soon expect the next. Technology is at the center of the process, as it always has been. Recent prospects include robots, drones and rapidly transforming distribution networks. Specific to last mile logistics, there’s companies like Uber, who are currently testing autonomous vehicles.
Innovations to last mile logistics are considered to be a viable option by a small, but growing, number of industry stakeholders who claim that on-demand carriers who were able to deliver packages to customers could be a good low-cost alternative. There is also the bonus of enhanced efficiency in the supply chain and boosts to productivity to consider.
It does seem like a leap of the imagination to consider that autonomous vehicles and other technologies are about to revolutionize the industry. Especially if you consider that North America is generally slower in developing omni-channel logistics and last mile delivery service than other competing regions.
However, some industry experts claim that there are signs that the speed of omni-channel adoption is growing, as shippers seek to bypass their current providers to gain better flexibility and deliver more punctually.
Most North American retailers have a dot com department, usually supported by a few distribution hubs to fulfill online orders. For these retailers, it is a sensible move to use a standard provider for last mile deliveries, as the points of origin are fixed.
However, if there are distribution points dotted across a network, including distribution centers, fed directly from suppliers or stores, it is still unclear to some that they need to be nearer to their customers. In order to achieve this, the retailer needs to get closer to the existing infrastructure in order to gain flexibility from between the shipping location and destination.
Where does a service like Uber fit in with last mile deliveries? The most important thing is that it lowers the bar for entry to new drivers and vehicles. This brings prices down and expands capacity to cope with fluctuations in demand, which is good news for both stakeholders and customers alike.