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How technology has changed the landscape of e-commerce deliveries

Offline stores quickly moved online to sustain themselves while consumer buying behavior shifted to e-commerce

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CIOL Bureau
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How technology has changed the landscape of e-commerce deliveries

The number of consumers shopping online had been growing rapidly and the pandemic has further fueled this growth. Fashion and electronics were always hot for ecommerce, now almost every category is.

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Offline stores quickly moved online to sustain themselves, and consumer buying behavior saw a paradigm shift. The shift includes the need for faster, yet free delivery.

Sellers, through marketplaces or direct to customers, are constantly looking for ways to improve speed and reduce the cost of Shipping across first, middle, and last-mile delivery.

The first mile is essentially the first leg of the package journey - the transportation of goods from a seller’s premises (outlet or warehouse) to the first hub. Last-mile or the last leg is the transportation from the last hub to the buyer’s doorstep. Everything in between the first and last mile, i.e., movement from one hub to the other is the middle mile.

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Here is how technology is bringing in efficiency in time and cost for the first and the last mile

Forecasting demand to prepare better

Sellers and carriers are both leveraging data and analytics to forecast demand pattern from different cities and different areas in a city. The forecast enables them to stock up inventory and get drivers and delivery vehicles on-boarded to ensure minimum time to pick up at the first mile, and delivery at the last mile.

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Bringing the product closer to the customer

Basis the demand analysis, sellers are building their warehouses closer to the demand to serve the same-day or 2-day delivery needs. This is obviously capital-intensive for SMBs. Tech-enabled on-demand warehousing or micro-warehousing providers store inventory as needed and fulfill on behalf of the seller on an OPEX model.

Improving Visibility and Adding Automation to delivery

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Real-time tracking solutions are providing deeper visibility into the supply chain for sellers, right from the time a customer places an order. This enables tracking of ground-level delivery events and eliminates inconsistencies, delays, and incorrect ETAs. Automated driver and resource allocation, number of packages per driver per route, automated dispatching is reducing the time and service cost. Similarly, predictive address correction technologies are helping curb failed deliveries at incorrect addresses.

Optimizing Delivery Routes

Software that plan routes and updates in real-time can bring a lot of efficiencies to deliveries. These software consider the number of parcels, their delivery location, the delivery time estimates provided to the customers, vehicle capacity, live traffic updates, weather conditions, etc. to recommend the best route and thus reduce the time taken for deliveries.

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Maximizing Utilization of Vehicles Capacity

To facilitate quick first or last mile movement, carriers often need to ignore their vehicle capacity utilization. However, to offer cheap shipping and to remain profitable, vehicle capacity utilization is key. Technology is helping strike the right balance to reach optimum capacity that doesn’t hurt the carrier’s pocket.

Partnership with Specialists

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Both sellers and carriers are partnering with delivery specialists of a region. Regional carriers are partnering with national posts for their deeper Pin Code coverage. And big sellers and carriers are partnering with regional and hyperlocal carriers which specialize in that region.

Leveraging Pick-up and Drop-off ‘PUDO’ Locations

Picking up from or dropping off at a PUDO (Pick-up & Drop-off) location or lockers reduces the last-mile delivery as the drivers need to go to select locations instead of several customer addresses.

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Customers have a unique key to access their packages, which ensures secure delivery and receival of packages. Specialized pickup stores used by one of the largest Ecommerce companies is an example of PUDO; Inpost Locker delivery is an example of a carrier leveraging the locker network.

Autonomous Vehicle and Drone Delivery

This is the game-changer in the delivery space, particularly in last mile deliveries. While autonomous vehicles can cut labor costs, drones can reduce distance and time manifolds. The speed and lower cost of delivery is prompting large carriers to push for autonomous delivery.

Communication and Real-Time Tracking

Regular notifications or nudges are keeping customers informed about their packages, thus making customers a part of the delivery chain. This is ideal to avoid failed delivery due to the absence of the customer at the delivery location.

This article has been written by Pankaj Sachdeva, vice president, innovation and India site leader at Pitney Bowes