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The COVID-19 pandemic has spurred a radical change in the entire supply chain, especially forcing transporters and retailers to rethink the strategies behind their last-mile deliveries. Companies are searching for ways to provide fast and timely deliveries (faster than ever before) while minimizing the contact between humans, both on the backend in distribution centers as well as between delivery people and consumers.
So, today we’re taking a look at how the COVID-19 pandemic is impacting last-mile deliveries in particular, and what these changes could mean for the infrastructure and process of the supply chain moving forward.
In addition to the best practices that we are seeing put into place for post-pandemic deliveries, many companies are leveraging the power of 3PLs such as Redwood Logistics. With the guidance of a seasoned and well-equipped 3PL, shippers can more readily formulate and navigate a solid post-pandemic last-mile delivery strategy. Our team is standing by to help you propel your company into the future, contact us here.
Ecommerce had already been on a steady incline for the past decade, particularly in the past two to three years. With that demand, we were already seeing truck capacity deficiencies and driver shortages. When COVID-19 hit, e-commerce (particularly groceries and personal care) suddenly soared overnight, creating an even greater strain on an already exhausted supply chain.
Consumers are looking for more convenience, which also means they’re demanding faster and more efficient deliveries. During the pandemic, people have been more understanding about reduced capacity and longer delivery times, but this understanding is already starting to shift as people expect transport companies to “keep up” with the changes.
Since COVID-19 is primarily spread between close contact of humans, companies are forced to look at new ways to minimize physical contact and closeness between workers as well as customers. COVID-19 may spread by contaminated surfaces, so delivery companies are also looking at ways to sanitize warehouses and packages to ensure the utmost safety for consumers and employees. This applies even more so to last-mile deliveries or white glove deliveries when the package must be handled with more care and are expected to get move quickly out the door of the final hub.
COVID-19 isn’t the cause of package theft, but there’s a lot more theft going on right now. “Porch pirates” are stealing packages right off from people’s doorsteps, sometimes within minutes of delivery. Unfortunately, the pandemic has spurred additional theft, possibly because of tough times and/or boredom. Thus, transport companies are looking for ways to minimize this loss to improve customer satisfaction and minimize refunds/resends.
As e-commerce grows, so do the companies in the e-commerce and logistics world. Greater competition means providing a positive customer experience is critical to stay afloat, let alone thrive. This means optimizing the last mile for the most transparent, timely, and safe delivery, so customers know when, where, and how their goods are getting delivered.
Contactless last-mile deliveries are going to be at the forefront of the post-pandemic implications. Optimizing the last mile means focusing on safety, speed, and capacity. At the forefront of this push, automation advancements are going to be the tools used to address these criteria.
Delivery drones can help take over some smaller last-mile deliveries in approved geographic regions. This allows for fast deployment, efficient distribution, and contactless delivery. Drones maximize capacity without adding strain to the driver shortage. Robotic deliveries are expected to be faster and less expensive than traditional delivery, especially for the last mile in rural and suburban areas.
Previously, drones have only been deployed in a few areas, but more and more places (like Canada’s airport hub) are working to bring drone delivery options to the skies. Following the pandemic, we expect drones to be implemented at an even faster rate to meet the safety and capacity demands we’re facing.
Decontamination robots are sanitizing packages, warehouses, and workspaces to minimize the transmission of any possible viruses or infections. Before this tech, it took days to fully clean a warehouse, so there was a lower frequency of cleaning. Now, a few decontamination robots can sanitize an entire center overnight, so it’s fresh for workers the next morning. Some robots are even being used to sanitize packages before they’re loaded into the truck (or autonomous vehicle) to further protect any risk for consumers.
To minimize contact between drivers and consumers as well as provide a layer of protection against theft, transport companies are offering more secure delivery methods aside from just home drop-offs. This includes:
That’s right. We might be on our way to having robots running down the street to hand us our packages!
In addition, a lot of companies are offering “virtual” signing for a package. They’ll text you if you approve the delivery of the package, and you can respond yes or no. This is further enabling no-contact while speeding up the process for last-mile drivers working on a strict schedule.
Even if companies don’t implement drones or AGVs for delivery, many are using metro hubs where contracted bikers or on-call drivers can bring out packages. This creates a network of on-demand drivers, similar to Uber for logistics. These freight-sharing apps match retailers with 3PLs and drivers with loads to maximize capacity, convenience, speed, and flexibility. For the last mile, this could even mean local drivers could work a few hours every day in their city to get goods from a centralized hub to customers’ doors.
When these new delivery options aren’t available, drivers are trained to take extra precautions for health and safety. Not only do they use gloves and sanitize the packages, but they also take pictures and send notifications or texts the moment a package has been delivered.
Logistics companies are creating more transparent processes so customers have an understanding of what’s going on with their goods. Clear communication has been shown to increase customer satisfaction, simply by keeping customers in the loop about the goings-on with their products.
Some companies even allow customers to pick their delivery window to ensure they’re home to take the package off their porch as fast as possible, thus minimizing the potential for theft. (This time-constrained delivery window is making last-mile logistics even more complex, which is why automated software is so critical for route optimization.)
Learn more about last-mile technology here.
Many retailers and logistics companies are moving towards a more distributed inventory model. This divides and distributes goods to distribution centers across the country (or the globe), based on projected sales for that region. This means that goods are shipped out before they’re ordered, so they can be housed closer to consumers when the order goes through. An order instantly sets in motion the last mile process, allowing for much faster and cheaper delivery once the sale has been made.
Warehouses are becoming overloaded with orders. To meet the rise in demand, workers have to work double-time, over time, and overnight to assemble and ship orders. Warehouses are understaffed as it is, and there are even more gaps as employers have to take time off for health reasons (if they are sick or potentially sick).
Robots and automated software are stepping in to fill the gaps and better address demand, so goods can get shipped out faster. Warehouse automation was already considered the “future” of logistics before COVID-19, but now it’s become the “present” with an enhanced rate of implementation and deployment to meet the demands for efficiency.
Route optimization has been increasingly difficult during the pandemic. An influx of orders, especially food and grocery orders, means that there are new and unexpected routes popping up. Dynamic, real-time rerouting is critical to keep up with orders while maximizing capacity. The faster the delivery, the better the customer service—and the faster the driver can pick up more goods to bring out.
Distributed inventory and warehouse automation are helping to address some of the bottlenecks that pop up before trucks go out for the last mile, but optimizing the on-road route is still necessary to achieve a high level of customer service.
Transport supervisors can’t handle route optimization on their own anymore. With new routes constantly popping up and new disruptions constantly interrupting routes, technology is critical to find the best routes. More and more logistics companies are implementing route optimization software with machine learning to get real-time route optimization for last-mile drivers.
Self-driving vehicles are primarily being used to maximize capacity and address the driver shortage. With such an increase in demand, autonomous vehicles can be used to quickly deliver packages to distribution centers, though they’re not yet being deployed for the last mile. Still, this would drastically free up drivers by having autonomous trucks take over the long routes, so drivers can stay close to home to be available for quick service in the last mile.
Transporters are looking to use the smallest possible package to fit the goods, while also consolidating orders into one package when necessary. This takes up a lot less room on the truck, which can help expand capacity. It may also help deter thieves since the packages are smaller and deemed less “worthy.” Something as seemingly simple as consolidating packages can have a major impact on the ability to deliver to consumers most efficiently.
With the boom of e-commerce and deliveries, there are more trucks on the road. Aside from the full implementation of drones and AGVs, it’s hard to get rid of congestion due to trucks. Since COVID-19, more people will likely begin working from home at least part-time and commuting at “regular” hours less frequently. This means that roads can be better designed for the logistics industry, rather than dealing with the combination of worker rush hour as well as truck routes.
Some infrastructure changes that cities have considered to assist logistics:
Everyone is working together to minimize delays in the last mile so consumers can get the food, products, and medicine they need, as quickly as possible.
Some experts believe it will take years for consumers to feel comfortable coming into full contact with delivery workers and other strangers again. Others believe that once a vaccine and/or cure comes out for COVID-19, people will be ready to go back to “life as normal.”
Regardless, a lot of the advancements made during this pandemic period are likely to continue on indefinitely. Contact-less delivery options and automated robotics are likely going to become a part of the normal way of handling last-mile deliveries. We also anticipate that customers will continue to order online more, especially for groceries and household products. This means that the innovations and infrastructure changes that address the pandemic will be critical to addressing the increased demand for timely and safe e-commerce deliveries moving forward.
We anticipate that the disruptions caused by COVID-19 are going to have long-term and long-lasting structural changes that will accelerate new, innovative models for last-mile deliveries.
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