As e-commerce is taking over the corporeal market, millennials want their products not just a click away, but as soon as possible. If you have ever ordered anything online, I am making an assumption: you must have tracked the product all the way from the order being accepted to reaching your doorstep.
In a bid to tackle the enormous demand created by the online market, a number of shipping companies emerged in the past two decades and are catering to millions of purchases made online. Last mile delivery is a small part of the entire logistics process, but a crucial one nonetheless.
What Is Last Mile Delivery, Anyway?
You have ordered something you always wanted or need immediately. You cannot wait for the product to arrive. You track its location frequently. And your happiness knows no bounds when the package reaches your city. This is when you know that it will be delivered very soon.
To make this easier for you, last mile delivery is the movement of goods from the last transportation hub to its final destination. Logistics companies try to deliver the products as fast as possible.
Big brands like Amazon who have their own shipping system are changing the shipping game by providing options like one, two or same-day delivery to their customers. Last mile delivery has a number of benefits. To mention a few,
1. Customers Can Opt From A Number Of Options
Last mile delivery opens a number of options for the customer to receive their parcel. Shippers are always looking for ways to simplify the shipping process. They often let their customers choose a location from which they can pick up the package.
This cost-effective method is not just more flexible but reduces the burden of standalone pickup locations a well.
2. Improved Scalability Of Operations
Shipping companies come under pressure during festivals and holidays. But they must make sure that it does not affect the shipping speed or capacity of the service. Solutions offered by third parties comes as the savior during this stage. This boosts the overall scalability and quality.
3. Automations Gives Space For Better Parcel Auditing
While transporting more than about ten thousand parcels, parcel auditing reduces the overall cost. Shipping companies must understand that parcel auditing improves the accountability of the last mile delivery.
Last Mile Delivery Trends
Over the past years, shipping companies have gone through a process of trial and error in a bid to reduce the overall cost and improve the service. Big companies like Amazon and Fedex are doing an excellent job in shipping goods at a lower cost but maintaining the speed at the same time. So, what are the trends in last mile delivery?
1. Shift In The Type Of Goods
Given that venture capital investments in supply chain and logistics startups are coming up at a steady pace, the industry is slowly shifting from physical assets like delivery goods to tech and info.
Big companies Amazon and Postmates post jobs on their apps. These jobs are in turn then taken by independent drivers. This type of delivery may not be up to the mark in terms of efficiency, but technology makes it cost-effective.
2. Fast Order Fulfillment
With easy access to the internet, users are finding it easier to find whatever they need faster than before. But at the same time, it also means that they want their orders delivered faster.
As mentioned earlier, Amazon has introduced two days, same day, or next day delivery. Warehouse management software plays an important role here. Examples of this kind of delivery include food and pharmaceuticals.
3. In-house Delivery Services Are On The Rise
In a bid to reduce last mile delivery expenses, many companies are now utilizing their shared vehicles for in house deliveries.
As a matter of fact, a few of these companies have joined hands with their competitors in the same region in order to reduce asset expenses. Many companies are using this mode of delivery for business purposes as the logistics are outsourced to another company.
In the restaurant industry alone, third party or in house delivery market is expected to be valued at 24.5 billion at the end of 2022.
4. Upselling During Delivery
Retailers are constantly looking for new ways to make money. With the help of data collection and using AI, companies can estimate what their customers may want to buy. Drivers are stocking their vehicles up with goods and items a customer has previously ordered and might need again.
Industries like food, pharmaceutical, and apparel are increasingly using this method.
5. Use Of Smart Technology And Improved Traceability
Consumers today constantly want to know the status of their order, logistics companies need to provide an update for the same. Thanks to technology, apart from tracking the location, customers can also track the temperate and humidity levels for items like frozen food.
Logistics companies are using smart technologies to predict the weather and plan the packaging accordingly. This technology that has the potential to revolutionize the whole industry.
6. Warehouses In Major Cities
In order to fulfill the same or next day delivery demands, the number of warehouses are on a rise. In selected cities with the option for 2 hour delivery for certain goods, Amazon is increasing the number of warehouses.
Companies are taking advantage of this growing demand for faster delivery with godown spaces. A corridor of warehouses is now a common sight on the outskirts of big cities. Renting a godown in the outskirts or in the city will serve your customers better.
7. Smart Planning, IoT, Traffic Data And Uberfication
When it comes to urban freight, a huge amount of time and cost is spent on finding an unloading zone, walking, and finally delivery.
But now, the delivery scheduling system will be developed with the help of big data to get real-time updates on traffic, availability of unloading and routes.
According to some sources, smart charging stations for electrical vehicles will be placed in various locations. The uberfication of last-mile delivery is inevitable. Social delivery networks will increasingly influence urban freight. Information such as loading capacity requires data from private and public partners.
8. Self-driving Delivery Vehicles
Several factors like the availability of drivers, their expenses, and keeping track of them could be hectic at times. This is where self-driving vehicles come to the rescue.
Apart from reducing the costs, self-driving vehicles could be deployed 24*7 and even during the festive season when the demand is high, but drivers are often unavailable. Not surprisingly, Amazon is leading the venture of autonomous vehicles. They are investing hundreds of millions of dollars, and already created a robot calling it “Amazon Scout”.
What’s In It For You?
Do you own a shipping or logistics company? Are you following the latest trends followed by the big names in the industry like Amazon or Fedex? Do you need an app-based solution for your shipping firm? If yes, contact an experienced application development company today!