Innovation in Last-Mile and Beyond – LogiSYM APAC 2022

Jun 03, 2022

The pandemic has revolutionized the way consumers shop, with e-commerce and last-mile delivery becoming lifelines for securing daily necessities and more. With the heightened convenience of e-commerce, the “flight to digital” has increased customer expectations which deepened the level of importance for supply chain and logistics efficiency, particularly in the last-mile space.

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LogiSYM Asia Pacific 2022

Today, last-mile innovations incur a significant portion of expenses in e-commerce logistics, with many groundbreaking technologies reinventing the way logistics providers go about their businesses. On that note, we had the honor to organize  our first physical panel discussion in a while on 25 May 2022, as part of LogiSYM Asia Pacific’s two-day mega logistics and supply chain conference. The theme for this year’s conference was ‘‘Transforming Logistics, Intralogistics and Supply Chain As We Emerge to the New Normal’’. 

The panel discussion focused on the innovations in the last-mile and beyond. It featured new-age leaders in the e-commerce logistics space, namely Arne Jeroschewski, Chief Executive Officer at Parcel PerformSenthil Kumar, Group Head of Commercial at Janio AsiaPanmeline Liew, e-Commerce City Operations Lead at Decathlon Singapore, and moderated by Bob Gill, the General Manager of Southeast Asia at ARC Advisory Group. The lively and dynamic roundtable allowed us to gather valuable insights on the pace of innovation for last-mile in recent years, the challenges faced in optimizing last-mile logistics, and more. 

Key Takeaway #1: Last-mile Challenges in the ‘New Normal’

Consumers are becoming increasingly sophisticated in what they demand from last-mile delivery. Immense pressure has been exerted on a complex and multi-layered delivery ecosystem. During the panel discussion, Senthil highlighted some key challenges faced in the last-mile space. He stated that the “seismic shock on supply chains induced by the pandemic world” resulted in various challenges such as “labor shortages, supply chain, and transportation disruptions”. To that end, our panelists collectively agreed that the pace of innovation today is growing at a slower rate. As mentioned by Arne, there has been “little innovation” seen in the industry as everyone is more focused on “capacity”. “The current industry growth is a little bit slower and it’s going to “refocus again on innovating the service industry”. With the increasing complexity of this space, Arne further emphasized the  pressing need for “managing consumer expectations and enhancing the delivery experience for customers” for many logistics and last-mile companies today. 

Key Takeaway #2: Technology as the Cornerstone of Innovation 

Despite the slower rate of innovations in the logistics world, we cannot disregard the notable innovations that have been made to overcome hurdles. Technology is undeniably a significant enabler for ever-shortening delivery times, allowing for more efficient supply-chain processes and the launch of innovative delivery methods. Our panelist, Senthil, mentioned that there has been a greater focus on providing “White Glove” customer service as consumers are now demanding more flexibility, personalization, convenience, and control for both shopping and delivery experiences. 

Consequently, this calls for innovative solutions not only on the customer side of things but also from the operational and fulfillment points of view. As the pandemic subsides, the goal is to build a customer-centric supply chain that is resilient and flexible enough to meet future day-to-day business requirements as well as “black-swan” shifts in supply and demand. Arne remarked that the innovations we observe today are not limited to technological ones but also process innovations. He said, “There is a lot of push to change the paradigm” that “…faster deliveries are more expensive”. On that note, consumer experience innovations include the ability to offer a wide variety of customizable and flexible delivery optionalities, such as click and collect, same-day or next-day delivery, scheduled delivery, and so on. To meet those needs, the operational and fulfillment capabilities have to adapt to these complexities, leveraging new, cutting-edge technologies. Senthil also added that there have been some notable innovations in the past few years such as the use of robotics in warehouse management, drone deliveries, as well as the rise of parcel lockers.  

Key Takeaway #3: Balancing Sustainability and Profitability 

Beyond rising demand, the past year has also seen a major shift to greener delivery options, with a wider spread of Electric Vehicles (EV) across the industry and more stringent carbon emission rules from cities are expected to shape delivery networks.

As retailers have adapted to new ways of fulfilling products purchased online in the post-Covid era, two new models stand out: ship-from-store and deliver-in-store. Our panelist, Panmeline gave invaluable insights on this as the lead for City E-Commerce Operations for a leading omnichannel sports retailer, Decathlon Singapore. She posited that sustainability is more than just eliminating plastic use and the usage of electric vehicles (EV). In the case of Decathlon Singapore, with its greater emphasis on environmental sustainability, it has since doubled up its megastores as omnichannel fulfillment centers that allow the company to cater to the rising delivery rates as well as optimize delivery routes to ensure faster and more efficient delivery attempts. The Click and Collect option is also available to provide consumers with a flexible, convenient, and sustainable delivery alternative. 

It’s no secret that the growing demand for speedy deliveries puts a strain on our environment. Offering a more sustainable delivery alternative is not only becoming essential to retain customers to ensure profitability, but also to ensure our planet can sustain us in the future. 

The Way Forward for Last-Mile Logistics 

The need for efficiency in last-mile logistics operations is increasing with the rising density of deliveries. Groundbreaking innovations and technological capabilities are creating new standards of efficiency in last-mile space to address commercial, social and environmental concerns. A very optimistic future for last-mile awaits, with many more innovations and options to deliver efficiency, flexibility, and convenience. 

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