John Taylor, managing director at Geoplan, looks at how the right geospatial data can help logistics companies deliver during peak season
UK retail sales reached an all-time high over Black Friday weekend in 2018, with £1.23bn (US1.58bn) spent – and we’re set to see even higher sales at the end of this month. But while retailers know Black Friday is one of the busiest shopping periods of the year, it comes with a huge degree of uncertainty for logistics operators.
There’s no real way to predict for sure what the volume of orders will be, where they will need delivering and, crucially, how many will want next-day delivery.
There seems to be an insatiable demand for faster, more convenient delivery options, and it’s heaping huge pressure on logistics operations. Online giants such as Amazon have normalized next-day delivery to such an extent that retailers can’t afford not to provide this offering. But it doesn’t mean we can’t find an answer to this challenge – or we can’t lighten the load by incentivizing consumers to choose another option.
The challenge of convenience
With convenience such a selling point, demand for next-day delivery is just the starting point. We now have an expectation that retailers can also arrange delivery on the same day – and for parcels to arrive within specific time periods of 15 minutes. Further still, customers may even want to change the drop-off location on the delivery day itself.
Offering this kind of flexibility has clear repercussions – especially when resources are stretched to their limits due to seasonal demand. Logistics operators, already struggling to meet the high volume of demand, will undoubtedly be forced to invest in supplementary vehicles and agency staff.
If we’re not careful, this can have a knock-on effect on both the quality of service and profitability. But when competitors are offering this level of service, it would be self-sabotage not to do the same.
Relieving the pressure
There are ways we can relieve these pressures, however. With the right geospatial data, and tools in place, it’s possible to optimize workloads by planning the most efficient routes for drop-offs and pickups. These calculations help to generate the most efficient drop sequences, depending on the nature of delivery and the destination, and that will provide incremental time savings.
These systems are also capable of factoring in real-life feedback, supplied by drivers – such as advice on the best place to park when accessing hard-to-reach destinations. These extra snippets of information all add up. The accumulative effect of taking minutes off each one of these trips is helping us to fit extra deliveries into a day and trim those last-mile delivery costs.
Best laid plans can be scuppered when customers change the delivery address on the day, however. That’s why modern logistics toolkits need to include geospatial tools with algorithms capable of recalculating delivery routes in almost real time.
With these highly reactive requirements, we need greater flexibility when assigning routes to drivers in order to cope. This will require logistics managers to deploy a demand responsive matrix (DRM), which will ensure that factors such as the closest driver, current vanload, van size, shift times and driver skill-set are taken into consideration when making those instant calculations.
Lightening the load
We can also use this technology to help educate the consumers on the cost of their convenience.
With climate change high on the current agenda, we can use geospatial tools to give consumers the option to choose ‘green delivery days’. When consumers opt to go green, logistics managers can ensure vans are filled to maximum capacity and this will reduce the number of vehicles put on the roads. This can also reduce the miles vans have to travel and cut fuel use and carbon emissions in the process.
By communicating the positives of eco-friendly delivery days to consumers, we’ll be giving them the chance to rethink their delivery options when hovering over the next-day button. This gives consumers the chance to play their part in protecting the planet – and will no doubt improve the way they perceive the brands they are buying from.
In addition, logistics managers will be given a more manageable and cost-effective workload. This will also help to lighten the load placed on warehouse staff and drivers, who will no doubt feel the strain during busy periods.
There’s little doubt that next-day delivery is here to stay, and as logistics professionals, we need solutions in place that can cope with the problems that arise as a result. We can also provide a viable alternative that will help educate consumers on the cost of the ever-increasing levels of convenience.
It’s inevitable that Black Friday will place extra pressure on logistic companies, but by using the right tools, we can manage the increase in workload more efficiently.