The analytics revolution in Last-Mile Delivery

This is an excerpt of the original article. It was written for the May-June 2018 edition of Supply Chain Management Review. The full article is available to current subscribers.

May-June 2018

Last month, I was in Atlanta at the Modex trade show. In one sense, it is a tribute to the automation technologies managing today’s distribution networks. And, I’m not only talking about automated materials handling systems, but also the software and NextGen technologies such as robotics, wearable technologies, including smart glasses and augmented reality solutions and sensors enabling the Internet of Things. In another sense, all of these solutions are coming together to drive fulfillment. With the increase in e-commerce, getting the right product to the right customer at the right time has never been more important.

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Urbanization is progressing at a rapid pace. The United Nations projects that by 2030 the number of so-called megacities of over 10 million inhabitants will rise to well above 40. About two-thirds of the global population is expected to reside in cities by 2050. Without a doubt, cities represent the epicenters of future global economic growth as well as the social, technological and cultural advancement of humanity.

The supply chain implications of these trends are profound. To remain competitive, companies across all sectors, industries and markets need to succeed at serving urban customers and consumers. This is particularly true in retail, where the battle over future consumer markets is largely a battle over who excels at managing the urban last mile of physical distribution.

Strategies for change

As urban populations grow, cities are becoming an increasingly complex and uncertain operational environment. The key driver of this complexity is a rapid increase in urban density. The potential of any city to grow in geographical size is naturally bounded. At some point, cities find that to keep growing they must build upwards to accommodate more people, businesses and activities.

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