The use of warehouse automation continues to grow at a rapid pace. This is mainly due to the continued growth in global e-commerce. E-commerce has had a major impact on the logistics industry as consumers seek value, choice and convenience. According to a Global Shopping Study in 2016, 94% of consumers had shopped online within the past year, driving a surge in parcel volume. Over the previous two years, there had been a 48% increase in global parcel volume, from 44 billion parcels in 2014 to 65 billion in 2016. Forecasts for future volume suggest parcel growth will continue to rise at 17-28% each year to 2021.
With the offer of same-day delivery now a consumer expectation, improving efficiency and reliability of the last-mile is paramount. According to McKinsey’s study,The Future of the Last Mile, the final part of a parcel’s journey reaches or exceeds 50% of the total delivery cost.
Reducing last-mile costs
Retailers have been trying to discover new ways of making delivery to customer homes seamless. When orders keep coming in at a continuous rapid pace, you need to be efficient enough to process them in line with customer expectations. Most online orders consist of delivering just one package rather than large volumes. This makes last-mile delivery more tedious, time-consuming and costly. Therefore, streamlining how packages are processed helps alleviate some of that burden.
There are many moving pieces associated with last-mile delivery. However, a piece that remains critical is making sure that customers get their package on time. That means finding new ways of increasing efficiency to handle all the moving pieces. Things such as the number of facilities and distribution centers a business has are important. The more locations you have, the greater the area you can cover.
The capability to provide customers with tracking and email alerts is important in e-commerce. Real-time data provided to recipients is always a high-percentage area of improvement for the supply chain, but it is flexibility in delivery that is most desired. Being able to handle capacity is also important. Greater capacity means a bigger need for technology. Technology can help improve customer service and provide better efficiency.
Automation and innovation
In the e-commerce space, consumers have the ability to choose the channel of delivery for parcels. Three key things determine the choices made: affordability, reliability and trackability. In order to be affordable, businesses need to look at their automation profile. To be more reliable, they need to collect data. Moreover, to be more trackable, they need to share data with their supply chain partners so that receivers and senders know what is happening in the network.
The challenge faced by supply chains in the e-commerce era is that consumers need to adapt. This has led to more competition for new businesses. So how does a business transform itself into a bigger player in the supply chain market? This is a question that is routinely asked and the answer is, “By leveraging data to drive increased visibility”. The data can then be used with plug-in modules and professional services to drive tracking and operational efficiency.
A sharper focus on parcel solutions is necessary, and sortation solutions such as the OneSort® family, Vantage and TrueSort® provide the necessary automation to make operations run more efficiently, accurately and cost effectively. All BlueCrest sortation solutions are powered by SortEngine™ 360, an innovative software platform that provides real-time data, has a seamless interface, and unique value in application flexibility.