We use cookies to provide you with a better experience. By continuing to browse the site you are agreeing to our use of cookies in accordance with our Cookie Policy.
  • ::COVID-19 COVERAGE::
  • INDUSTRY PRESS ROOM
  • ABOUT
  • CONTACT
  • MEDIA FILE
  • Create Account
  • Sign In
  • Sign Out
  • My Account
Free Newsletters
  • MAGAZINE
    • Current Issue
    • Archives
    • Digital Edition
    • Subscribe
    • Newsletters
    • Mobile Apps
  • TRANSPORTATION
  • MATERIAL HANDLING
  • TECHNOLOGY
  • LIFT TRUCKS
  • PODCAST ETC.
    • Podcast
    • Blogs
      • Analytics & Big Data
      • Best Practices
      • Dispatches
      • Empowering Your Performance Edge
      • Logistics Problem Solving
      • One-Off Sound Off
      • Public Sector Logistics
      • Two Sides of the Logistics Coin
      • Submit your blog post
    • Events
    • White Papers
    • Industry Press Room
      • Upload Your News
    • New Products
      • Upload Your Product News
    • Conference Guides
    • Conference Reports
    • Newsletters
    • Mobile Apps
  • DCV-TV
    • DCV-TV 1: News
    • DCV-TV 2: Case Studies
    • DCV-TV 3: Webcasts
    • DCV-TV 4: Viewer Contributed
    • DCV-TV 5: Solution Profiles
    • MODEX 2020
    • Upload Your Video
  • MAGAZINE
    • Current Issue
    • Archives
    • Digital Edition
    • Subscribe
    • Newsletters
    • Mobile Apps
  • TRANSPORTATION
  • MATERIAL HANDLING
  • TECHNOLOGY
  • LIFT TRUCKS
  • PODCAST ETC.
    • Podcast
    • Blogs
      • Analytics & Big Data
      • Best Practices
      • Dispatches
      • Empowering Your Performance Edge
      • Logistics Problem Solving
      • One-Off Sound Off
      • Public Sector Logistics
      • Two Sides of the Logistics Coin
      • Submit your blog post
    • Events
    • White Papers
    • Industry Press Room
      • Upload Your News
    • New Products
      • Upload Your Product News
    • Conference Guides
    • Conference Reports
    • Newsletters
    • Mobile Apps
  • DCV-TV
    • DCV-TV 1: News
    • DCV-TV 2: Case Studies
    • DCV-TV 3: Webcasts
    • DCV-TV 4: Viewer Contributed
    • DCV-TV 5: Solution Profiles
    • MODEX 2020
    • Upload Your Video
Home » Coming home
outbound

Coming home

November 21, 2014
Mitch Mac Donald
No Comments

There are numerous examples of traditional solutions being applied to nontraditional problems. The latest comes from the nascent but fast-growing world of home delivery services, a field the retailing ecosystem is still trying to come to grips with.

A survey by consultancy Retail Systems Research, prepared in cooperation with Descartes Systems Group and in partnership with DC Velocity and CSCMP's Supply Chain Quarterly, is perhaps the most extensive analysis to date of two major challenges confronting everyone who makes, distributes, and moves goods: how to manage in a digital world where direct access to consumers is more common than ever before, and how to incorporate flexible omnichannel strategies into a rigid model built around distributing and delivering into one channel. (A more detailed analysis of the survey's findings will be presented in a Dec. 3 DC Velocity webcast.)

The survey, "The State of Home Delivery 2014," queried roughly 100 companies engaged in home deliveries. The universe was divided into roughly three equal parts: retailers, third-party logistics service providers (3PLs), and manufacturers and distributors. All stakeholders, naturally, brought their own biases into the exercise based on their capabilities. Retailers, who outside of furniture and appliances never paid much attention to home delivery supply chains, were more interested in positioning the service as a competitive differentiator than a profit center. Their suppliers saw things differently.

Logistics service providers were more likely than retailers and manufacturers to pass on the costs of hitting narrow delivery windows. As for technology, retailers and manufacturers were more interested in simpler user interfaces and better training to improve their skills. 3PLs, by contrast, believe they already have a grasp on the technology and are more interested in advanced capabilities like route optimization.

The survey's authors, noting that each participant starts "from a different level of maturity," offered up a unique set of recommendations for each sector. The common thread among the recommendations, though, was that they smacked of good, old-fashioned business principles. For instance, the authors advised retailers to consider passing on costs to customers, noting that consumer expectations for narrower delivery windows and high-touch deliveries could make pass-throughs unavoidable. They also urged retailers to look more closely at drop shipping despite their traditional reluctance to do so. And they warned retailers against investing in technology as a "proxy" for process, repeating the time-honored maxim that the world's best technology can't overcome a poorly designed process.

Manufacturers should get to know their customers better, the authors wrote, noting that these respondents seemed to downplay the importance of consumer expectations for shorter home delivery windows. Technology investments should be made with flexibility in mind, rather than efficiency. Boosting utilization of existing capacity will be difficult in a world of ever-increasing customer demands, the report said. By contrast, using technology to improve flexibility will add value to the customer relationship and generate more revenue opportunities.

3PLs must make an effort to understand the needs of the ultimate customer, the authors said, noting that service providers don't seem to grasp the influence today's consumers wield over retailers. Although 3PLs are skilled at home deliveries, they have been providing this capability under an "old-world" retail model in which the only deliveries consumers are willing to pay for are those involving big-ticket items, the authors said. That model has fading relevance in today's digitized retail environment, yet many 3PLs still view the world that way, and their cultures may be resistant to change. If 3PLs focus their resources and expertise on meeting the dynamic needs of retailers and their customers, everyone will win. If they can't break out of their cultural box, much money will be left on the table.

Another timeless principle came through in the report: Be patient and realistic. Folks in the supply chain may be overstating their ability to execute the direct-to-consumer model. If so, they risk the wrath of an increasingly unforgiving consumer. "We strongly advise all companies to do a sincere self-assessment of capabilities vs. their peers," the authors said.

Material Handling Transportation Parcel & Postal Carriers Warehousing 3PL Business Management & Finance
KEYWORDS Descartes Systems Group Inc.
  • Related Articles

    Manufacturing jobs may indeed be coming "home," but who will do them?

    NITL attendees get a glimpse of chickens coming home to roost

    a home for 3PLs?: interview with Joel Hoiland

Mitchmacdonald
Mitch Mac Donald has more than 30 years of experience in both the newspaper and magazine businesses. He has covered the logistics and supply chain fields since 1988. Twice named one of the Top 10 Business Journalists in the U.S., he has served in a multitude of editorial and publishing roles. The leading force behind the launch of Supply Chain Management Review, he was that brand's founding publisher and editorial director from 1997 to 2000. Additionally, he has served as news editor, chief editor, publisher and editorial director of Logistics Management, as well as publisher of Modern Materials Handling. Mitch is also the president and CEO of Agile Business Media, LLC, the parent company of DC VELOCITY and CSCMP's Supply Chain Quarterly.

Recent Articles by Mitch Mac Donald

Thought I’d something more to say …

Digital supply chains, circular economies, and a whole bunch of uncertainty

Sorry, folks. This is not normal

You must login or register in order to post a comment.

Report Abusive Comment

Most Popular Articles

  • Relaxed regulations for drone parcel delivery to take effect in March

  • Gartner survey signals increased investment in resilience over the next two years

  • Increasing Urgency for Vaccine Supplies Drives Launch of New Vaccine Manufacturing Resources on Thomasnet.com

  • What Level of Automation is Right for Your Warehouse?

  • IBM survey says digitalization trends will sweep trucking industry by 2030

Now Playing on DCV-TV

Ef7899d1 1c83 487b 9291 8af692931c96

myQ Dock Management

DCV-TV 4: Viewer Contributed
Introducing myQ Dock Management. Connect your loading dock equipment and iDock Controls from Poweramp, McGuire, or DLM to the cloud and view your loading activity online with myQ Dock Management.Facilities with myQ can monitor the real-time status of their docks and be proactive in improving efficiency and safety. ...

FEATURED WHITE PAPERS

  • Time to rethink your lift truck power

  • Warehouse Management System Project Toolkit

  • Solving Talent Management Challenges Now and In the Future

  • Shaping Up Last Mile Delivery to Surpass Customer Expectations

View More

Subscribe to DC Velocity Magazine

GET YOUR FREE SUBSCRIPTION
  • SUBSCRIBE
  • NEWSLETTERS
  • ADVERTISING
  • CUSTOMER CARE
  • CONTACT
  • ABOUT
  • STAFF
  • PRIVACY POLICY

Copyright ©2021. All Rights ReservedDesign, CMS, Hosting & Web Development :: ePublishing