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The new delivery man
Innovation

The new delivery man

12 May 2016

A parcel’s journey halfway across the world is a modern marvel. First by container from factory to port or railhead, it then journeys on a pallet to a logistics hub outside the city.

 

For most consumers, it’s the next bit - delivery to the doorstep – that they know best and find so frustrating when it goes wrong or deliveries are missed.

 

If incorrectly handled, it can also be (literally) a logistical nightmare for those managing deliveries. This congested ‘last mile' is often the least efficient part of the supply chain, contributing to a large part of the total cost of moving goods.

 

As e-commerce continues to grow – it’s set to reach US$2.4 trillion globally by 2018 – finding better last mile delivery solutions becomes even more important, a particular challenge in parts of Asia where transportation and logistics capabilities are still developing. Geography can pose challenges too, such as in Indonesia, which is made up of thousands of islands.

 

Happily entrepreneurs, systems engineers and software experts are rising to these challenges by experimenting with a range of delivery innovations that should speed delivery times and extend the reach of parcel services.

 

The delivery man will never be the same again.

The delivery drone takes flight

In October 2015, Singapore Post (SingPost) garnered interest by conducting a successful trial of its drone mail service from Lorong Halus to Pulau Ubin – a 2km journey which only took five minutes. Elsewhere in the world, Google and Amazon are competing with logistics specialists like SingPost and DHL, to deliver to doorsteps by soaring over congestion and obstacles. Drone deliveries by unmanned aerial vehicles (UAVs) could be especially suited to remote areas and sprawling suburbs, cutting delivery times.

 

However, these are early days as companies continue to seek ways to make delivery drones cheaper and more reliable in dense cities. UAVs are close to commercialisation in some areas though. Google’s Project Wing should start delivering parcels in 2017, while DHL's parcelcopter is making test deliveries in Germany. Amazon, which recently unveiled its drone prototype, also hopes to get regulatory support for its Prime Air service.

Bike to the future

Drones may not be ready for prime time just yet but older solutions with modern technological twists may be. The bike remains an efficient and eco-friendly way to make hundreds of daily urban deliveries. With a modern boost from cheap and efficient electric motors, electric cargo bikes give couriers more endurance, range and carrying capacity.

 

A research project in Europe estimates that cargo bikes could deliver 51% of goods in European cities, cutting emissions and congestion. Cargo bikes have a number of benefits including being able to navigate narrow and congested streets and avoid parking restrictions, their need for less space, low operating costs and greater speed over short distances (up to 4km), especially during peak hours.

All aboard the urban delivery train

The urban delivery train could be the answer to city centre shop deliveries. Gothenburg’s innovative Stadsleveransen system and the similar Cargohopper system in the Dutch city of Utrecht enables once-congested streets to be turned over for use by pedestrians and cyclists by removing truck and van traffic from the city centre. The Gothenburg system manages deliveries for 500 shops and businesses by pooling them outside the city centre and then completing the last leg using a smaller electric cargo vehicle with a trailer.

Calling the e-commerce ninjas

Despite the novel last-mile solutions being tried and tested around the world, the industry has not given up on the traditional delivery man and van as yet. Instead, logistics companies are finding new ways to increase efficiency using big data, cloud computing and virtualisation.

 

Ambitious and fast-growing start-ups such as Singapore’s Ninja Van, with a 100-strong vehicle fleet, aim to speed deliveries to serve Asia’s booming e-commerce market. Ninja Van makes deliveries more cheaply and efficiently thanks to algorithms that optimise the routes and vehicles that should be used for each delivery, enabling drivers to deliver more parcels a day.

Last-mile innovators aren’t done yet

Innovations are making deliveries greener, faster and more reliable thanks to smart couriers that dynamically optimise route collections and deliveries as well as low-cost and low-impact solutions such as e-bikes, city centre urban trains and click-and-collect locker solutions.

 

The battle for the last-mile market will evolve further.

 

Grocery delivery is an emerging area. Amazon, Google and Instacart are fighting it out in the US, Alibaba’s Tmall.com is targeting online grocery shoppers in Beijing and companies like HappyFresh are providing such services in Southeast Asian cities.

 

Another area of focus is getting parcel deliveries under the half-hour mark. Greater automation will be a key to cost-effective and speedy deliveries. The practicality and economics of drone deliveries are already being tested. But in the fight for the last-mile market in urban centres, drones will be up against not just smarter, nimbler couriers but also real-time market platforms such as Uber, which is already launching a food delivery service via its vast networks of drivers.

 

It looks like the story of the last mile hasn't run out of road yet.