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The rising importance of the last mile

Consumers are getting more demanding by the day resulting into speed and delivery accuracy becoming key in today’s market. This new demand collides with the existing way of package delivery where costs were key. A recent example of new developments to solve this problem came from Walmart, a company whose is now trying to compete on with Amazon.

After the initial hype of Prime air, Walmart needed something feasible to deliver its products. Two weeks ago, October 3rd, Walmart announced the purchase of Parcel, a delivery service that specializes in carrying packages to apartments in New York. Parcel will continue services for its current customers, but it will become the last-mile courier for Walmart.com and Jet.com, the e-commerce company Walmart bought last year. This acquisition of Parcel shows that they now know what to focus on: The last mile.

 

The uprising of the last mile

So why the importance of the last mile? The initial upcoming of the concept has two main sources: the growing necessity of on time delivery for consumers and the density of trucks inside cities. The latter is becoming increasingly hard to ignore with the concepts of lean and the uprising of environmentally correct decisions. Hence, the focus on the last mile is the result of the cities urge to reduce the number of trucks in the city and the companies aim to reduce the amount of empty trips. These two factors created now well known companies such as Transmission, who work from distribution centres all over the Benelux gathering and delivering packages from all sorts of companies.

However, the real last mile comes into view when looking at the city distribution. Companies such as Fietskoeriers.nl and other rising companies with warehouses alongside or even in the city are the real reason last mile deliveries are becoming of more and more importance to traditional parcel delivery companies. The reason is simple: how can those traditional companies handle 1 or 2-hour deliveries? Their very structure doesn’t allow this way of package delivery.

 

Delivery with(out) a personal touch

Added to the simple speed advantages that are possible with these means of city distribution, companies like Parcel have another interesting advantage. On top of providing customers of a 2-hour delivery frame during a day, these smaller companies have the means to keep track of customer details concerning deliveries. Allowing them to ease the delivery to previously known addresses. This not only gives them the advantage compared to other courier services who have to look for the correct delivery places in complex structures such as flats. But also allows Parcel to send live package updates via text message to the merchant and recipient, informing them both of the location of the package through the last mile of delivery.

On the other hand, another trend takes opposite direction: parcel pick up stations are a rising phenomenon around every city. It is not that this concept is new, the parcel pick up point at Tilburg university has existed since 2014. However, the rising spread of this infrastructure makes it an increasingly valid way to deliver your packages. As of now almost all big parcel companies, e.g. PostNL and UPS, have started offering this way of delivery to their customers.

 

The future view

So, what does the future hold for the last mile deliveries? The possibilities are endless, new infrastructures will allow new ways of transportation. The plans of international hyperloop transportation allow people to ship parcels from the Netherlands to France in less than 30 minutes. Without a doubt, new ways of delivery will continue to rise. Already existing, experimental, ways such as Amazon Prime air will provide delivery possibilities within the hour. One thing is certain, the last mile of a delivery will be shorter and more flexible than ever before.

 

Sources:

https://corporate.walmart.com/article/walmart-announces-the-acquisition-of-parcel-a-technology-based-same-day-and-last-mile-delivery-company

https://www.brabant.nl/actueel/nieuws/2016/april/brabant-neemt-voortouw-in-creatieve-innovatie.aspx

https://blog.walmart.com/business/20171003/who-is-parcel-what-this-delivery-company-means-to-walmart

https://www.bloomberg.com/news/articles/2017-06-01/dutch-testing-tube-unveiled-for-hyperloop-transport-system

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