Parcel - October 2008 - (Page 22)

chain challenges, and as a consequence, some initiatives like last mile have had to take a number. PARCEL: All of which begs the question: Is it a good time or a bad time to be a last-mile logistics professional? ing blind after products leave the DC to travel the ﬁnal 50 to 100 miles to the customer, which is a shame, considering that’s the time when most customers are likely to want very precise details about their shipment location. Supply chain autonomy at the store level is also huge. Too often, companies’ individual stores seem to function as their own logistics silos with their own ﬂeets or designated transportation vendors. It sounds good in theory, but it eliminates the possibility of combining multiple stores’ orders, running them through a route optimization program and taking advantage of economies of scale. But the biggest problem by far is probably just the way people underestimate the last mile. driving when, in fact, it’s often about a lot of other premium services like installation or assembly — and pricing and scheduling accordingly. A lot of retailers’ employees underestimate last mile’s cost, which is why some store associates or customer service reps don’t think twice about agreeing to rebate the cost of a delivery when a customer implies the expense is going to be a dealbreaker. They truly don’t realize that by doing so they may have practically given away the store. And I truly believe that most companies underestimate what having a high-quality last-mile delivery process in place can do for their overall sales — and not in terms of the products people buy and get delivered. Delivery doesn’t just get products from point A to point B. It often keeps people shopping in your stores instead of someone else’s. Meyer: In many ways, it’s a great time because there’s so much potential to make a positive impact on customer service and the bottom line. Most companies’ last-mile operations still have vast pockets of inefﬁciency and wide windows of opportunity. And if those are addressed, it could actually help companies do a better job of coping with some of those other challenges. PARCEL: Care to elaborate on any of them? Meyer: For starters, there’s the whole issue of order visibility. Most shippers are more than willing to pay for sophisticated tools that allow them to keep a handle on inventory all the way from Asia to the Americas. But a lot of them are still work- PARCEL: In what way? Meyer: In every way. For example, a lot of businesses underestimate the complexity involved with last-mile deliveries. They assume it’s predominantly about the PARCEL: You mentioned that there weren’t a lot of large last-mile delivery providers in the industry, at least not for heavy products. Do you think that’s played a role in the inefﬁciencies you describe? Meyer: Absolutely. Our industry has historically been very fragmented, and anytime you have fragmentation you have fewer opportunities to leverage and analyze based on higher volumes. Bigger isn’t always better. But there’s something to be said for having the bandwidth to invest in the right kinds of systems and operations — and being able to provide consistent service across multiple markets. PARCEL: One last question: Where do you see the last-mile industry going in the next 10 years? Meyer: Nowhere but up. The attention paid to the function may wax and wane, and ﬁnal-mile delivery may never get easy to provide. But some customers will always need their retailers to make “house calls,” and professionals with the expertise to help them do that should be able to parlay it into great success. 22 October 2008 www.PARCELindustry.com http://www.scancode.com http://www.scancode.com http://www.PARCELindustry.com

Table of Contents Feed for the Digital Edition of Parcel - October 2008

Parcel - October 2008 Contents Editor's Note What Would Augello Say? Best Practices Survey Results Going with the Flow Is Your Parcel Network Optimized? Last (Mile), but Not Least Moving From Manual to Automated Fulfillment A Race for Excellence Making Ends Meet Is Your Job Killing You? Software Selection Demystified Controlling Costs On the Mark Product Profile New Products & Services Advertiser Index Wrap Up

Parcel - October 2008

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