COVID 19 and Last Mile Delivery
The demand for local deliveries has gone up as most households are following the stay-at-home order as well as social distancing recommendations. These measures have put a lot of pressure on on-line retail and grocery stores that may be struggling to meet order delivery volume.
However, logistics and warehousing businesses are making changes to improve operations.
Online Retailers Are Limiting Orders to Manage Last Mile Deliveries
Some online grocers have resorted to refusing new customers and limited the frequency of orders customers can place through their accounts to an address.
High Street retailers have also been affected by the shut-downs as they are struggling to manage demand and hit SLAs. Wal-Mart which holds the majority stake in ASDA described its supply chain as “catching its breath” with delivery orders. They pointed out that their kerbside pick-up service is fully “slammed”.
Even major on-line corporations with stronger delivery systems like Amazon that had been planning to introduce their own last-mile delivery services have put their developing plans on pause.
Amazon announced that it is focusing on meeting its own shipping needs first before it can provide order delivery services to third party retailers. The service is not expected to be resumed until June 2020.
Last Mile Carriers Are Hiring More Drivers
Meanwhile, the demand for delivery drivers has gone up and they are being recast as heroes along with shelf stackers and checkout workers. Warehouse workers and delivery drivers play a crucial role in keeping the supply chains going. They take risks by going out to make deliveries so that people can stay home safely.
Logistics companies and warehouse operators are rightly taking steps to protect their workforces with personal protective equipment and improvements in delivery policies. For instance, DPD UK no longer requires their drivers to get customer signatures to prove delivery. The drivers can now take a picture of the parcel from a distance at the point of delivery.
Other carriers have authorized their drivers to make signatures themselves to eliminate the need for contact with customers.
Looking Ahead To the Future
Experts suggest that we will get through the pandemic in the next 6 to 10 months and things will return to normal. High street stores will re-open and people go back to work. What will have changed for retail and grocery shopping?
A lot. E-Commerce and home deliveries offer many perks and benefits to customers over regular high-street shopping. It is quicker and in many cases cheaper than going to the store on public transport or your own vehicle. It saves a lot of time as well.
Since the onset of COVID-19 we have seen perhaps the biggest demand-side shock in the history of E-Commerce. This exposed some weaknesses in last mile delivery operations for operators.
However, we must understand that the fulfilment capacity of delivery and warehousing businesses won’t go up overnight to catch up with the demand volumes that millions of new shoppers are generating right now. The good news is that we are moving in the right direction.
We believe that things will change permanently post COVID-19 and shift towards an online shopping culture. Last mile delivery and on-demand warehouses will become a central player in the online retail supply chain.
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