From order to delivery, a package covers considerable distance. But the biggest challenge is the last mile. Small delivery amounts and numerous individual locations make delivery cost-intensive and time-consuming – even with a well-planned route. And, after all that, the recipient is often not at home and the whole game must be repeated.
Parcel service providers are faced with an economic problem – and inner cities are struggling with gridlock. Delivery vehicles cause around 80 percent of congestion in cities, block roads, and pollute the environment. Due to a strong increase in e-commerce, delivery services are pushed to their limits. More than three billion parcels were transported around Germany in 2016 alone. This is predicted to increase by 30 percent by the year 2021. How can the industry tackle such a volume of parcels?
There are two different approaches to finding a solution – depending on whether goods are brought the customer, or if the customer picks up the goods. In the first instance, it’s all about optimizing transport routes by making the last mile more flexible . Big data helps in planning the delivery process in advance and responding more to customer needs. Analytics calculate delivery time down to the hour, which can then be communicated to the customer in advance. This ensures that preferred delivery time is taken into account.
An ecological alternative to delivery vehicles are micro depots and e-bikes which are already being tested in several cities. Micro depots are set up in central locations where couriers can easily pick up and drop off packages with cargo bikes or trolleys. This has a positive effect on city centers by reducing the amount of traffic and exhaust emissions. Deutsche Post DHL Group is also striving to be more environmentally friendly and cut down emissions with its ambitious aim for "zero-emission logistics" and by using electric delivery vehicles.
At the same time, courier company Hermes is testing automated solutions with delivery robots . The self-driving vehicles can deliver shipments weighing up to 15kg direct to your front door. The robots move at walking pace along the sidewalk, can recognize traffic lights, and overcome curbs. They are primarily suitable for short-distance, urgent deliveries such as food or medication.
In contrast, delivery by the kind of drones tested by Amazon and DHL looks less likely – especially in urban areas where license requirements and risk of injury present huge hurdles. However, there may be more potential for them to be used in difficult-to-access regions, such as in the mountains or to islands.
Smart Delivery Ideas for the City
There are numerous established methods for customers to collect goods, helping them avoid missing deliveries when they are not at home. These include parcel collection points or shops , which eliminate the need for deliverymen to travel to so many individual end customers. However, even if service providers prefer this method, most customers still favor home delivery – at a date and time chosen by them.
At the moment, the last mile is inefficient. Many solution models have been put into place to change this – but which will prevail? Particularly promising is the flexibility created by the concept of micro depots. Logistics in urban areas is likely to become a mix of e-mobility and automated delivery vehicles. However, this can only be achieved with smart cities, big data, and widespread digitization of the industry.