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How customer demands are reshaping the logistics industry

February 21, 2018

customer forces shaping logisticsThe logistics industry is heavily influenced by customers, and frankly delivery companies would not be able to operate without their consumers.

With, the growth in ecommerce and the increasing demands from consumers for ever-faster delivery options, the logistics industry is being forced to adapt to meet this shift in expectations.

Recently, the logistics industry has become heavily equipped with technological innovation, meaning that more services can be carried out quickly and efficiently. With more advanced pallet delivery to more seamless international delivery, the logistics industry is hearing our pleas, but how exactly have they reshaped their services?

Faster delivery services

A survey conducted by McKinsey, revealed that customers are demanding faster delivery services, and many may even be willing to pay premium prices for it. To put this into perspective, almost 25% of consumers will pay larger amounts for an instant delivery service, and given that younger consumers are the biggest users of the same day delivery service, this figure is only likely to increase over time.

While next day delivery is considered as a convenient and fast parcel delivery method, there is a lot of focus on same day delivery for consumers currently, which has attracted a lot of funding from venture capital firms in order to meet the requirements from the public.

Ultimately, vendors want to be able to offer the best customer experience to their clients, therefore improving the services that they provide is absolutely necessary to meet demands.

Ways to enable faster delivery

So, we know that customers are looking for faster delivery services, however how is the logistics industry going to achieve this? With technology, of course.

While same day delivery is achievable for couriers working on a local scale, it can be slightly out of reach when wanting to deliver nationwide. However, technology is in the logistics industry for a reason, and is allowing couriers to deliver goods to customers faster than ever before.

Recently, we have seen the rise of parcel lockers, and while these can shorten the delivery time and thus reach the recipient quicker, they prove to be very unpopular with the general public.

Instead, drones were found to be the most cost-competitive solution to instant parcel delivery to rural areas, and actually work out to be just 10% higher than the usual cost of today’s delivery model.

Due to their higher speeds compared to trucks and vans, they can undeniably provide a faster parcel delivery service to meet the demands of customers, although the disadvantages are difficult to ignore.

Firstly, drones are only suitable for the transportation of lighter parcels, and spacious landing areas are required. they are also unable to travel longer distances, making them impractical for deliveries to more remote areas.

The impact of e-commerce

There’s no denying the impact that ecommerce is having on the logistics industry, as we’ve seen the multichannel supply chain evolving very rapidly in order to meet the needs of the consumer.

Overall, due to ecommerce, delivery preferences have become very important for the business-orientated parcel delivery market, meaning that delivery times need to be improved in order to meet the needs of the consumer.

Considering that the only human contact that ecommerce companies have with their customers is via parcel delivery, it’s vital that this market meets the needs of the public in order to keep them satisfied.

New entrants to the industry

As we’ve already explored, there has been a large number of different technologies making their way into logistics, however a huge force behind the movement to meet customer demands come from the start-ups emerging within the industry.

For the majority of these start-ups, the idea is to offer innovative, technological processes within the delivery industry in order to meet customers’ demands of a faster service, yet do so by charging a lower price.

In addition to start-ups however, we’ve also seen other major players making a large impact in order to reshape the industry according to consumer demands. Funnily enough, the ‘player’ doesn’t exist as a human being exactly, and instead comes in the form of automated vehicles, more specifically self-driving lockers and machine-to-machine parcel-station loading.

Furthermore, crowd-sharing platforms are expected to emerge from the development of autonomous vehicles in the logistics industry, hoping to streamline the entire process even further.

It’s expected that 100% of X2C items and 80% of all items will be delivered by autonomous vehicles in the future, and such technology is able to bypass numerous lengthy delivery processes in order to ship items to the recipient much quicker.

The logistics industry is highly important for businesses and consumers alike, so it’s paramount that it takes into account customer demands in order to provide the best service possible. Luckily, with ample technological innovations in the industry, customers are able to receive the service that they long for.

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