With urbanization, cities worldwide grow fast. Changing consumer behavior is leading to new requirement in final delivery; more frequent, faster, just-in-time and much more complicated.
Smarter cities, sharing open data, and better software capabilities create possibilities for innovation in parcel delivery services.
More, and even more
Continuous growth in home shopping and peer-to-peer marketplaces will lead to more shipments in inner cities and in residential areas. Today, more than one out of two online transaction are consumer-to-consumer.
At the same time the emergence of smaller convenient stores, so called ‘nano stores’, 3D printing, renovation of houses and new personal health care concepts put even greater pressure on existing local distribution networks leading congestion, accidents and a poor air quality.
Distribution in cities and residential areas should be ‘invisible’. Each municipality now sets its own rules for city distribution; environmental zones, strict time windows and special privileges.
The delivery truck should be a friendly guest in cities. The driver must carefully navigate through cars, public transport buses, pedestrians and cyclists. Only those drivers who really know their way around, and adhere to strict codes of conduct, will be welcome in cities. Having a drivers’ license is no longer a license to operate. We need local specialists using cargo bikes, small electrical trucks, local drop-of-point and perfect knowledge about their local consumers.
Cleaner, more quiet, safer and smaller vehicles and cargo bikes will be the delivery vehicles of the future. A European study showed that more than 50% of city freight could shift from truck to bike. Vehicles, with their onboard computers, will be connected to local traffic control centers, avoiding congestion, road works and schools; intelligent transport systems.
European municipalities will have local, and specific, rules. This will not be easy for large parcel delivery services like TNT, DHL, FedEx, UPS and DPD, who seek to standardize their processes and systems for reasons of operational excellence.
Traditional parcel delivery services are now getting competition from ICT companies like UberRush, powered by Google’s Uber taxi-app, and Shutl, which was acquired by eBay. They orchestrate the delivery of a package with the ease of booking a taxi. These taxis, or cargo bikes, can come right away, and deliver directly, or pick up a parcel and deliver later today or tomorrow. Local, experienced couriers do the job. The rates are very competitive. Could this be the answer to the need for more local customization of delivery services?
The European Union is working on the further liberalisation of road transport by logistics service providers. The question is whether the further liberalisation of shippers transport on own account would not be more effective and yield better results.
One of the biggest challenges for a delivery provider is achieving a successful delivery drop first time and missed deliveries are costly – estimated on average at around £23 per drop. Using mobile data technology to track items combined with proactive customer alerts plays a significant role in helping to achieve higher first time success rates.
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