What is the “last mile” delivery?
Last-mile delivery is about the “last mile” journey of a delivery product/package from the warehouse to the customer’s doorstep that is part of supply chain management and transportation. It involves the customer’s expectation and satisfaction.
With the COVID-19 being a disruption in the consumers’ usual purchase practice, online sales have rocketed and the demand to fulfil numerous speedy shopping purchases to be delivered on the same day, at the lowest cost, remains the biggest challenge for all businesses and customers on the receiving end.
Challenges of “last mile” delivery?
Have you ever had a package go missing or even a damaged item? This all involves time to solve. Cracking the management and logistics of “last mile” delivery covers a number of factors which includes cost, efficiency, data, pollution, environmental and sustainability issues.
With customers’ expectations of free delivery, retailers and logistics partners are pressured to absorb the costs and it is in their interest to constantly look out for new technology to be implemented and drive process advancement.
Major issues include:
- Traffic congestion – A worldwide issue is deliveries to arrive on time and standstill traffic in busy cities rarely ceases which seems to be the main cause.
- Rural Areas – The opposite problem of traffic is the distance between deliveries which also involves time and effort, which affects the cost and effort to get from point A to B.
- Faster, low-cost delivery – With customers’ expectations of free delivery, retailers and logistics partners are pressured to absorb the costs and find a way to complete the increase of delivery frequency. It is in their interests to constantly look out for new technology to be implemented and drive process advancement.
How many times have you ordered something relatively inexpensive, but the delivery charges in peak hour tripled the overall spent? Many third-party vendors are helping with the outsourcing of delivery services, but a lot of the time, demand exceeds the supply of humans to help with transportation, driving costs up.
During the lockdown, food delivery charges were at an all-time record. There was even a period where bookings for deliveries were no longer accepted.
Improving “last mile’ delivery
- Data transparency and accessibility – Scalability depends on the transparency of data access which will help with data management, optimisation of deliveries and costs, which will help improve the overall performance in the supply chain. This will identify patterns, provide new or improved ways of resolving problems. Allowing data to be managed via a cloud, will allow managers to pull out information on the go.
- Third-party logistics vendors – Also known as a 3PL, they can fulfil orders for companies by storing items in a warehouse, in specific regions for customers. When orders are placed, the 3PL vendor provides transportation and last-mile deliveries.
Lux Research reported predictions that automated last-mile deliveries will generate up to $48.4 billion in revenue by 2030.
With Singapore as a case study, it has more than 80% of its population living in HDB’s flats, usually with a shopping mall in its vicinity. There is a big gap in the demand for deliveries in housing estates and a shortage of supply from retailers.
With unmanned autonomous vehicles still being tested out worldwide, unmanned sidewalk robotics is a solution that is closer to action in Singapore.
OTSAW is looking to disrupt and transform the last mile delivery service with a robot called Camello. They will provide an ecosystem, from order to housing, logistics and delivery. They aim to help businesses gain better efficiency and profitability over time either from purchasing or partnering on a subscription basis.
They look to deploy fleets of robots which will benefit not just business but customers too.
Benefits of the autonomous robot, Camello
Lower delivery costs
As reported by robotics business review.com, ‘The key driver is the reduction of cost of last-mile deliveries, from $1.60 per delivery via human drivers, down to $0.06 per delivery through autonomous robots.’
Costs they will take into consideration will be calculated based on energy to operate the robots and associated systems, duty cycles of robots, cost per hour, cost per delivery, cost per shift, plus the number of shifts or days. Lastly, the cost of maintenance.
With the aim to deliver goods from 5-30 minutes from local hub points or the retail outlet, this will improve efficiency and customer satisfaction, with immediate deployment. Imagine your supermarket deliveries a little fresher, and hot meals actually hot!
With deliveries that can reach up to 50kg, autonomous robots can help lighten the load for customers, like the elderly who may struggle with even walking.
With fuel costs usually included, the autonomous robot will be run on battery instead, meaning a lot less release of CO2 into the atmosphere. The only other alternatives to carbon-free delivery have been bicycle deliveries.
Also coming into play is less packaging and this will help in the long run for sustainability and recycling, something which is part of OTSAW’s Sustainability Development Strategy.
As the pandemic hit the fast forward button on ambitious delivery solutions, it has pushed companies like OTSAW to draw on its flexible and innovative DNA to hit the drawing board to adapt its services for environmentally friendly solutions like Camello.