Whether it’s a blockbuster movie release, dumplings from our favourite take-away shop or the latest high street fashion item, most of us have had moments of ‘wanting it now.’
Technology has put the world at our fingertips, offering us instant gratification on multiple levels, and we’ve come to expect the emotional fulfilment that convenience provides, as a normal part of everyday life.
When it comes to e-Commerce, we want the exact same instant gratification. According to American marketing consultants, Invesp, 80 per cent of shoppers want same-day shipping, while 61 per cent want their packages even faster — within 1-3 hours of placing an order.
Simply put, humans are becoming more impatient. Retailers are noticing this with the race on to create the fastest delivery possible with last-mile logistics companies now going to great lengths to make sure their supplies arrive first.
This accounts, at least in part, for the recent growth in autonomous last mile delivery. The process uses automatic ground and aerial vehicles like drones and robots to deliver goods to homes and offices. The global autonomous last mile delivery market was valued at USD$1.1 billion in 2021, and is expected to reach USD$5.62 billion by 2027 according to a Research and Markets study. This is attributed to changing consumer preferences the aforementioned instant gratification trend among them, in concert with rapid advancements in technology worldwide, especially when it comes to e-Commerce. Major e-Commerce players and numerous food and grocery delivery service start-ups have identified last mile services as a significant differentiator in the market and this is expected to propel market growth.
The pinnacle of last mile logistics is of course Amazon, renowned for its ultra-fast turnaround time, offering same-day deliveries in many American cities. Here, Amazon’s next-day delivery is available in Melbourne and Sydney, setting the bar high. It’s not stopping there either. Amazon’s delivery drone, Prime Air, is still in the early phases, but the company has promised in marketing material that “Prime Air vehicles will be as normal as seeing mail trucks on the road.”
FedEx and Volkswagen have used autonomous road vehicles for delivery in China and Germany. The US Postal Service hopes to have autonomous vehicles online by 2025, helping deliver on more than 25,000 rural routes. Although referred to as driverless vehicles, they can have delivery people on board with the vehicles providing the driving, whereby the delivery person is dropped at an address and the vehicle continues to an alternate address to pick them up, eliminating the need for parking. In more controlled settings, robots are also being used to make deliveries, although navigating crowded settings can still be problematic.
While North America is expected to dominate this type of last-mile, automatic delivery market, Australia is starting to follow suit. Two companies have recently been approved by the Civil Aviation Safety Authority — Swoop Aero, which focuses on medical equipment and supplies, and Wing Aviation, a subsidiary of Google parent company Alphabet who operates from Canberra, Brisbane and the Gold Coast. Australia is also flirting with the idea of self-driving trucks, trialling them on Melbourne’s CityLink highway late last year.
For those without drones or robots, all is not lost, with many players in the industry forming partnerships to maximise their reach in whatever way they can. Express courier company Zoom2U, for example, joined forces late last year with Greyhound Australia to use their buses to move parcels between capital cities. By partnering with Greyhound, Zoom2u can now offer a next-day delivery service at a fraction of the cost of air freight. Parcels are moved on buses every day of the year, providing an alternative to traditional courier movements.
Numerous online truck aggregator service providers, such as Ofload, Shippit, FreightExchange and Loadshift are also bridging the gap between truck owners and end users. Users can book full truck load, on-demand services, refrigerated freight and palletisation, and they are usually well-equipped with all the tracking and analytical technology required for the job.
Quick, efficient vehicles, however, aren’t the only ingredients involved in the creation of timely deliveries. Efficient storage of goods is a priority as well. The number of packages requiring accessible and organised storage is increasing as e-Commerce grows. Australia Post reported that November 2022 was the biggest month in Australian online shopping history, with more than six million households making an online purchase during the month, up 3 per cent from the year before. For this reason, many big and small players are investing in warehouse upgrades to support faster delivery both with newer, bigger storage centres in convenient hubs, but also with upgrades including advanced automation.
Last November, DHL Supply Chain announced plans to deploy 1,000 robots to its Australian warehouses by 2025 – its largest investment in robotics and automation in the Asia-Pacific region, valued at $150 million. It also opened its first shopping centre standalone service point, making express delivery services more accessible and convenient. Late last year, to keep pace with e-Commerce demand, Australia Post opened a new $82 million parcel facility in Perth, complete with state-of-the-art automation. The 23,000-square-metre facility has the capacity to process close to 200,000 parcels a day.
Meanwhile, Coles has just opened its first automated distribution centre in Redbank, Queensland, investing more than $1 billion in the project. The centre is the largest of its kind in the southern hemisphere, with a building size of 66,000 square metres.
Technology isn’t just at the heart of distribution centres, but at all points along the supply chain, making processes as streamlined and as quick as possible. These include end-to-end tracking through real-time status visibility and optimising routes for drivers to ensure timely delivery. The use of analytics is also on the rise, allowing shippers to gain clarity on current issues and mitigate risk. In fact, using the right technology, many companies argue, can help streamline employee tasks and keep customers engaged — a win for both retail and consumers.
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