Traditional courier and post companies are at a moment so pivotal that it will determine who remains profitable for decades to come, and who finds themselves obsolete within years.
It’s clear that commerce has fundamentally changed, but what few grasp is how that change has reshaped retail competition and is remaking supply chains. So much so that Accenture analysis predicts that by 2023, more than 50% of all eCommerce purchases will be delivered from local inventory - and that number could easily be 70%.
Of course, while offering fast, free shipping is critically important, it is also difficult and costly, causing many leaders to question the sustainability of fast and free delivery. There are some who believe that senders will have to stop “subsidising” delivery at some point that it is not a race to the top, but a race to the bottom. They evaluate delivery through old models that are focused on minimising cost by consolidating de-livery into regional processing centers, limiting their ability to offer the kind of last mile delivery that retailers need.
What retailers have realised is that the traditional delivery model is too difficult and costly for fast and free delivery. Instead, the answer is for inventory to be close to the consumer. That’s why retailers are investing heavily to create an omnichannel supply chain that enables greater speed, efficiency, transparency and flexibility.
So how are retailers investing to meet consumer expectations sustainably and efficiently? These five trends toward an omnichannel future are reshaping supply chains—and demand a corresponding change from traditional postal organizations.
- By selling via marketplaces, inventory is stored in one place, meaning it’s quicker and easier to get purchases straight to customers.
- Inventory management is crucial for retailers to enable fulfilment from stores – technology is facilitating a new level of accuracy.
- Storefronts, back rooms and a floor in an office can be fulfilment centers, bringing inventory closer to consumers and cutting costs for retailers.
- Automation and advanced robotics are transforming new warehousing spaces into low-cost, highly efficient processing and fulfilment centers.
- By using customer data to predict purchases, items are in warehouses for less time, get to customers faster and improve companies’ balance sheets.
The transformation of the last mile has begun, and when it is complete, the world of delivery will be drastically different. Retailers will see even faster eCommerce growth. Consumers will take advantage of and expect more delivery capabilities. In short, the way people buy and get things will be fundamentally changed.