Increasingly important last mile delivery looks set to send shockwaves down the air cargo industry, the Last Mile ASEAN Conference and Expo in Bangkok heard on September 20 at the Bangkok International trade and Exhibition Centre (BITEC).
The last mile is usually the shortest part of the journey for goods which have usually been flown from other parts of the world but is 30 per cent of the cost, says ramco logistics head of solution advisory Rajesh Kumar.
“It has implications for all the parties in the ecosystem,“ Kumar says, pointing out particularly the problems with sustainability this will create.
A panel discussion at the conference also noted the risk to brand reputation poor last mile services can do as these are how consumers usually perceive the entire logistics chain.
Things are sometimes not helped by last-milers using casual suppliers especially for drivers, not all of whom are trained. A second problem is some only serve a small area. Lalamove for example is active in Bangkok but has no plans to extend to cover the rest of Thailand – despite demand and customers being there.
The rapid growth of last mile is also pulling in new players including large corporates such as Amazon, JD.com and Alibaba all of whom are building their own logistics networks.
“Keep an eye on them,” was Kumar’s stark warning: “they are going to seriously challenge you.”
Some solutions were suggested at the conference with increased cooperation being one of the most tipped.
“(We) will have to come together and agree on the deliveries together,” says Post 10 Worldwide president and managing director Arlene Padua-Martinez. Adding to the workload in this sub-sector is the increasing tendency towards short time frames, two hours now being a norm in some urban areas as well as more customers wanting on-demand services although new technologies such as robotics might be a help here.