First & Last mile automation of delivery

The last mile often poses most problems for any retailer. For example, if at the time of delivery, the customer is not at home or is out of reach, it costs the company crucial time and money. It also exposes the goods to the risk of damage, theft, etc.

Further, with increasing internet penetration and a sharp rise in numbers of online buyers, such instances are only increasing. Sometimes, there are other risks involved in the delivery process. Amazon and Flipkart, for example, have declined customers from Uttar Pradesh in the past because of consumer malpractice.

In logistical terms, this final struggle to get the product to its customer is known as the “last mile problem.” Transport makes up for a huge chunk of the last mile problem. 75% of commercial vehicles in this sector in India are owned by small fleet operators. Furthermore, there is an acute lack of proper road and rail infrastructure. And to top it all, most of these fall in the unorganised sector.

Research shows that just about 1% logistics players in India fall in the organised sector. The resultant dominance of the unorganised sector exposes the entire industry to a vicious cycle of inefficient utilisation of resources, corruption and suboptimal services.

The unorganised sector also brings with it wage labourers who play a very important role in the last mile. They could be your delivery men, tempo services, etc and even they are plagued with problems like incompetent wages and lack of infrastructure.

We are attempting to create an ecosystem where better economies of the organised sector help improve the wages and available resources of the unorganised sector. At the same time, they are benefiting the organised sector by taking away the headache of that last mile.

We take a look at shipping logistics, the last mile problem, and how companies can adapt to the new challenges of e-commerce shipping. 

As consumers increasingly turn to e-commerce for all their shopping needs, speedy fulfilment isn't just a "nice to have" — it's the expectation of every online shopping experience. And if logistics companies and their retail partners want a shot at thwarting the ever-looming threat of Amazon Prime, it needs to be a priority.

As a result, businesses have begun racing to develop new technologies and experimental supply chain models to increase parcel volume, expedite deliveries, and delight customers — all while trying to cut costs. Unfortunately, one of their biggest expenses and challenges is same-day, last mile shipping.

In a product's journey from warehouse shelf to customer doorstep, the "last mile" of delivery is the final step of the process — the point at which the package finally arrives at the buyer's door. In addition to being a key to customer satisfaction, last mile delivery is both the most expensive and time-consuming part of the shipping process.

If you've ever tracked a package online and saw that it was "out for delivery" for what felt like forever, you already understand that the last mile problem is inefficiency. That's because the final leg of shipment typically involves multiple stops with low drop sizes.

In rural areas, delivery points along a particular route could be several miles apart, with only one or two packages getting dropped off at each one. In cities, the outlook isn't much better; what urban areas make up for in stop proximity is quickly negated by the near constant delays of traffic congestion.

The costs and inefficiencies of the last mile problem have only been further compounded by the continuous rise of e-commerce in retail sales, which has dramatically increased the number of parcels delivered each day, as well as raised customer expectations to include not just fast, but also free, delivery.

As a share of the total cost of shipping, last mile delivery costs are substantial — comprising 53% overall. And with the growing aspect of "free shipping," customers are less willing to foot a delivery fee, forcing retailers and logistics partners to shoulder the cost. As such, it's become the first place they're looking to implement new technologies and drive process improvements.

With the rise of the gig economy, many consumers are already familiar with the concept of crowdsourcing local services through digital platforms like Uber, Airbnb, and Postmates. Location-based crowdsourcing allows consumers to open a mobile app to hail a ride, book a place to stay, order coffee to the office, hire a handyman to mount a TV, send flowers to that special someone, or even schedule takeout to arrive just as they're walking through their apartment door.

With crowdsource technology, retailers, logistics partners, and consumers can connect directly with local, non-professional couriers who use their own transportation to make deliveries. Companies can get their online orders to customers faster, and customers can get their items when and where they want them. The freedom to make on-demand and scheduled deliveries also ensures that customers are home at the time of delivery — eliminating the need for a second (or third) attempt.

And with the ongoing integration and enhancement of automation across industries, it's likely we'll start seeing delivery robots, drones, and self-driving vehicles making many of these drop-offs in the not-so-far future.