Ecommerce is One of the Factors Creating Uncertainty and Driving Change in the Logistics Industry

CSCMP’s Annual State of Logistics Report titled Accelerating into Uncertainty makes the point, among other data and information, that overall logistics/delivery costs have declined in the last few years, even though energy prices have increased.

It seems as if consumer behavior is becoming the primary driver of logistics spending, rather than energy prices, and this, coupled with more widespread adoption of innovative technologies, is fundamentally changing the industry.

Logistics - Supply Chain Consulting - Waller & Associates LLC

The change in consumer behavior is closely tied to the rising popularity of ecommerce. More goods being purchased online with delivery to the customers home or place of business included as part of the transaction, instead of from brick and mortar stores with the customer collecting and transporting goods purchased, means a steadily increasing demand for rapid delivery.

Ecommerce customers often have high expectations of the delivery process with same-day or next-day delivery becoming a requirement, and one of the factors that can determine the success and failure of an ecommerce business.

Facilitating fast and efficient package delivery to the customer’s door is fast becoming a major part of the overall logistics and transport industry. Coping with this shift means that many businesses have to ramp up their use of cutting-edge supply chain management technology and modify or completely redesign their operational procedures.

Keep an Eye on These Trends

A steady increase in the volume of ecommerce related package deliveries is leading to a fundamental change in the way distribution networks operate, with these three trends likely to become an important part of the supply chain landscape over the next few years:

1.  Regional distribution centers – to shorten delivery times by moving popular goods closer to densely populated areas

2.  New route configurations – to transport merchandise from national distribution centers and rebalance volumes between local and regional centers

3.  Last-mile focus – capabilities in this area are essential to successfully performing same-day/rapid delivery