Could Forward Inventory help the drivers’ shortage on the last mile?

Logistics and Supply Chain News

The drivers’ shortage is something many countries around the developed world are experiencing. There isn’t just one solution that could work and according to Brenda Stoner, CEO and Founder, PICKUP, one possible answer is forward inventory. The Logistics Point spoke to Stoner about the last mile and how it is transforming.

What are the problems for last mile delivery of larger goods?

The pandemic and material shortages are contributing to the many supply chain obstacles that retailers have had to overcome. Transportation issues are only exasperating the problem, and the capacity to move available products quickly is not even close to being able to keep up with consumer demand. There are also hurdles when inventory is local to a market but is miles away from the nearest sales and distribution center. This is especially true for big, heavy and high value items because the larger and more expensive the item is, the higher the customer expectation for a seamless delivery.

Consumers ordering big and heavy items online not only expect the same delivery experience they get from small packages – one that’s fast, convenient and easy to track – but they also require an extra layer of added service such as in-home assembly or installation. Supply chains need an advanced way to respond to consumers’ expectations that spiked during COVID-19, especially as consumers continue buying furniture and appliances for their homes.

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Additionally, retailers need to identify a way to create flexibility in their supply chain. This is especially true for larger goods since many retailers don’t have the capacity to store these bulky items at their physical stores or fulfillment centers due to space constraints. This is also starting to become an issue in the reverse logistics area, as many retailers are having to tell consumers to just keep the item for now until space can be allocated to receive these returned items.

How can inventory management help the last mile?

To overcome these challenges, logistics and supply chain leaders can lean on Buy Anywhere, Deliver Anywhere (BADA) offering to provide a best-in-class delivery experience with convenience, control, communication and consistency.

A BADA model enabled by inventory visibility can track products throughout the supply chain and ensure items are available to fulfill customer orders. By understanding where their inventory is and how they can get the inventory closer to their customers, shippers and other business professionals can position inventory in the most advantageous way to increase same day sales and drive revenue.

Implementing BADA capabilities successfully requires a real-time view of inventory, especially at the store level where the exact number of items available can be accurately accounted for. A unified platform can provide this information immediately, helping organizations understand which items are available in proximity and how to route orders quickly to the customer. This can be done with a single integration to e-commerce or POS in-store, allowing for a BADA model that helps meet retailers’ needs at scale.

Innovative technology is helping to meet customers’ requirements by providing business intelligence on what consumers are buying and how to get these items closest to their customers for delivery. It’s with these tools that retailers like Target are successfully positioning the right inventory as close as they can get it to each consumer, making fast delivery possible. By optimizing delivery and logistics, supply chains can quickly deliver items anywhere and anytime.

What strategies are there for delivering larger goods on the last mile? What do you think would be the best one?

“Companies like Amazon, Uber, and Postmates paved the way for shoppers to expect fast, convenient delivery experiences, prompting other retailers to expedite their last-mile delivery services. The ability to deliver everything from consumer-packaged goods to big, heavy and high-value goods without adding cost and complexity is now necessary.

Three key factors retailers need to win the last mile experience focus on offering multiple fulfillment options, optimizing logistics and developing a curated delivery network.

To provide experiential deliveries for customers, it’s essential that retailers offer buy anywhere delivery anywhere (BADA) and buy online deliver from store (BODFS) capabilities to give customers what they want, when they want it. This is especially important for big and heavy items where it can be challenging for consumers to figure out how to get these high-ticket purchases directly to their homes.

Shoppers don’t want to wait weeks for their delivery to arrive, and they certainly don’t want to deal with a long delivery window on the day of their delivery. Convenience and trust are key as consumers also want to be able to handle delivery on their own terms and have clear visibility and control throughout the process. Retailers need to provide same day or scheduled delivery within a single window to provide this type of speed and flexibility. By having convenient fulfillment options for heavy goods, consumers can choose a time that works best for their schedule and enjoy the fast and frictionless delivery they have come to expect.

How can we address the driver shortage on the last mile?

Many retailers today still operate a traditional legacy carrier network with days or weeks of lead times, multiple carriers and all-day windows. This results in an inconsistent customer experience. To overcome these operational challenges as well as mitigate against the current driver shortage, retailers should analyze the option of implementing forward inventory to support forecasted demand.

One way retailers can achieve optimized delivery and logistics is by partnering with an all-in-one last-mile delivery provider to implement a platform integration that can help meet these needs at scale. This will enable a strong network of resources that can help effectively manage fulfillment operations while ensuring fast and accurate delivery at the convenience of the shopper. By outsourcing the last mile, retailers will see increased inventory velocity and spend less time solving delivery issues and risks. ✷

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