last mile logistic trends

The last mile logistics industry has evolved over time due to a variety of influencing factors, one of them being the popularity of e-commerce in consumer retail spending. Each year more and more sales typically made in brick-and-mortar stores are shifting to online. Last year alone eight percent shifted from the traditional brick-and-mortar to e-commerce channels.

The shift towards online purchasing has also brought upon significant increases in order fulfillment volumes. From 2013 to 2018 online orders are expected to increase by 35 million deliveries. Many supply chain operations, in their current state, cannot support these surges in fulfillment. To prepare warehousing and distribution center operations retailers are adding facility space. Nearly forty percent of all industrial development is tied to new facility additions and expansions linked to e-commerce fulfillment operations.

Another challenge e-commerce fulfillment operations are encountering is customer experience management. The top five surveyed satisfaction areas: service, range, speed, cost and innovation were all ranked below 7.5 out of 10 by consumers. This has forced many retailers to reevaluate their fulfillment strategies. Retailers are adding new last mile delivery methods such as click-to-collect, smart lockers and courier delivery in an effort to improve lagging functional areas. These methods bring deliveries to customers more quickly, cost effectively and to the most convenient location for the end consumer.

In the future consumers can expect additional service offerings including real-time delivery tracking, SMS & e-mail alerts, Sunday delivery and other custom delivery options. These solutions are made possible by the addition of automation technologies and delivery tracking software such as WMS, all of which many retail and supply chain businesses intend to implement and upgrade in the coming years.

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