Last-mile delivery is more than getting a package or product to its final destination. “The truth is that today we’re in the data business,” says Brian Surber, vice president of operations at Priority Dispatch Inc. in Cincinnati. “We signed up, we thought, to be in the delivery business. But we spend more and more time, money and resource on our information technology infrastructure to support the visibility of the product we move than we do innovating the delivery itself.”
E-commerce has been a boon for last-mile delivery companies, but it has also created challenges and changes, many of them related to catering to consumer preferences. To deal with those issues, carriers have had to improvise, overcome and adapt, with measures that include live tracking and same- or one-day delivery.
When tracking technology first came out, data was sent at the end of the day or on a certain schedule, says Thomas Jowers, vice president and chief operating officer at ADL Delivery in Houston. “Now, consumers want to know right now that their package at their door — they want to see a picture of it at the door through their video camera system,” Jowers says. “They want that tangibility.”
The growth in last-mile delivery “is a wonderful wave to ride,” Surber says. But there are costs associated with real-time tracking and visibility, and Surber is skeptical about the sustainability of supporting those costs, particularly concerning real-time tracking of non-essential items “versus necessities, like in the health-care market, where it’s crucial if you’re moving an organ or a transplant.”
Also at issue is “free delivery.” Not only do consumers want their package now, they also want to pay nothing for delivery, Jowers says: “That’s the unsustainable part. They want it right now and they want it for free, and they don’t realize there is a cost (to deliver it). Everything you look at, everything you touch, regardless of what it is, has a transportation cost. Somewhere, there is someone doing the transportation for it, whether that’s the first mile or the last mile.”
Data around visibility plays other roles within the last-mile space:
●Route optimization. Tools such as route-optimization software, artificial intelligence and predictive modeling can aid carriers in getting drivers where they need to be in the quickest and most efficient manner. Real-time data about locations, events such as traffic accidents, slow traffic and other information, enables such systems to re-route drivers to minimize lateness.
●Improvement of driver performance and safety. “When we can use predictive analytics to make intelligent decisions for dispatching and route optimization to maximize efficiency, it allows companies to proactively manage their businesses,” says Eric Donaldson, chief business development officer at Dispatch Science in Montreal. Many responses to issues like driver safety and compliance are reactive rather than proactive, he says: “Managing by exception rather than by every event allows companies to reduce errors.”
For example, he says, a manager or dispatcher “who used to handle and touch every single job now has the ability to monitor the speed and control and the distance of events that are triggered and can proactively contact the driver in real time and coach, as opposed to coaching afterward.”
Another application is integrating the software with an electronic logging device in the delivery vehicle, so a driver’s remaining hours of service can be displayed in real time, says Donaldson, who, with Jowers and Surber, are members of the Customized Logistics and Delivery Association, a non-profit trade association based in Washington D.C.
“So, if drivers are getting short on hours, the system can make recommendations based on traffic patterns and based on hours remaining,” Donaldson says. “It can be displayed so that the system is making decisions — or a human can interdict. So, drivers won’t get stranded on the road because they’ve run out of hours. They’re not going to be driving fatigued, to reduce the potential safety risks.”
Technology —and data — will continue to provide challenges to the last-mile delivery space, Surber says: “We’ve got to keep up the technology, but at the same time, it’s great traction for the final mile.”