“Never let a good crisis go to waste.” The achievements of a fledgling e-commerce industry during the beginning of this century have been astounding. The concept of shopping on a home computer or cellphone (anywhere, at any time, for absolutely anything), selecting and paying an agreeable price for it with a simple click, and receiving it in our mailbox or on our doorstep within a few days or even on the same day was unimaginable two decades ago. And now this entire supply chain journey that enables a $5 trillion online retail industry to thrive is accomplished in less time and for lower cost than driving to a store.
This revolutionary restructuring of how we shop couldn’t have come at a better time. The catastrophic blow to the economy caused by the COVID-19 pandemic was devastating. But just imagine how we would have come through it without this inventive new e-commerce infrastructure that we now depend upon. Winston Churchill is credited with saying, “Never let a good crisis go to waste.” And while Jeff Bezos, the brilliant visionary credited as the father of the online shopping ecosystem called “e-commerce” didn’t build Amazon upon a crisis, the pandemic catastrophe is now thrusting this daring young industry into its next stage of innovation and invention at warp speed.
“Crises are like adrenaline for innovation, causing barriers that once took years to overcome to evaporate in a matter of days. Entrenched orthodoxies on ‘the way things are done’ are replaced with ‘the new way we do things’ almost overnight,” says an article from McKinsey & Company. Perhaps it’s not yet appreciated as an industry crisis, but navigating the last step is the latest challenge to be tackled by inventive logistics entrepreneurs. Like the wide variety of products offered by Amazon at its “Everything Store,” a rising cohort of e-commerce service providers is offering a variety of creative methods for consumers to securely receive their goods in the comfort of their own homes.
Suddenly, in pursuit of a seamless delivery infrastructure, opportunistic inventors are leaping at opportunities to close remaining gaps and tie loose ends along this inchoate new supply chain. Enabled by artificial intelligence (AI), they are developing parcel scanning and loading systems, route optimization tools, smart lockers, secure building access devices, aerial drones, sidewalk robots, autonomous electric delivery vehicles, and the software that links all their transaction data in real time.
The “Last Mile” Is Not the “Last Step”
Conventional supply chain wisdom defines “last-mile delivery” as “a product's journey from warehouse shelf to the back of a truck, to a customer doorstep where, as the final step of the process, the package finally arrives at the buyer's door.” Getting packages to customers’ doorsteps so quickly and efficiently is clearly a remarkable e-commerce supply chain industry achievement. But what good is all this effort if the package doesn’t eventually get inside the door and into the customer’s hands? Simply getting a package “to a customer doorstep” is hardly “the final step of the process.”
Criminal Justice expert Dr. Ben Stickle asserts that, “the assumption that the retail supply chain ends when the products are delivered to the customer’s doorstep... is an outdated perception that does not fit the diverse needs of the consumer… Because most packages are left unattended at the consumer’s doorstep, the items are vulnerable to product loss, damage and theft.” Considering package theft alone, he cites a survey estimate that “over 35 million Americans were the victims of the crime in 2020, resulting in approximately 5.4 billion dollars in financial losses.”
Dr Stickle suggests that the e-commerce delivery “industry needs to focus not merely on ‘The Last Mile’ of the package delivery process but ‘The Last Foot,’ so to speak… While this section of the supply chain may be the shortest, both in time and space, it is fraught with the most risks, highest losses, and significant impact to many stakeholders,” especially the retailers. Studies indicate that “issues at the last foot are rarely seen as delivery company responsibility; blame and poor brand trust are assigned to the retailer. As the direct contact with the consumer shrinks, the experience at the last foot needs to be positive.” And retailers need to own and maintain this relationship.
Alternative Delivery Options
Conventional residential mailboxes and neighborhood cluster boxes have met the needs of parcel delivery for decades, yet recent growth in volume and average package size are resulting in problematic overflow and re-delivery. UPS, FedEx, and USPS, of course, provide alternative package pick-up accommodations at their own locations for undeliverable articles and for customers who aren’t home at the time of delivery, and they are consistently expanding access points in partnerships with major retailers like Walgreens, CVS, and Staples.
Buy online, pick-up in store (BOPIS) is another alternative access option that will certainly resume activity when consumers begin to venture out from under COVID-19 again. By the end of summer 2020, the share of retailers offering this omnichannel option had already jumped to 44%.
A growing number of parcel locker operators are providing expanded package pick-up accommodation as well. They offer convenient contactless access in retail shopping, office, and commutation locations. It’s no surprise that Amazon Hub is a major player, while independent operators Smiota,Parcel Pending, and Pitney Bowes are all expanding their reach.
The Household Threshold Is the Battle Line
New battle lines are being drawn along thresholds at front doors across America as the latest wave of e-commerce delivery entrepreneurs prepares for “Door Wars” over the ideal solution for consumers to actually get their hands on their goods, on their terms!
Beth DeCarbo of the Wall Street Journal recognized the trend in “last step” innovation during the depth of the pandemic. “To eliminate the need to leave home to retrieve a package, a number of companies offer smart locks and boxes for use at home. BoxLock, for example, sells a Wi-Fi connected lock that collects tracking information on coming deliveries and alerts homeowners when they arrive. Delivery drivers use the lock to scan a package’s bar code, which opens the lock on a secured storage box. The homeowner then receives an alert that a package has arrived.”
Another emerging “Door Warrior” with a focus on groceries and perishables is DeliverySafe. And HomeValet has also introduced a temperature-controlled household locker that accommodates groceries as well as parcels and is conducting a pilot in partnership with Walmart.
No stranger to variety, Walmart is also trying out delivery by drone, not to be outdone by CVS, who, in partnership with UPS, is testing this method of personalized delivery to consumers’ homes too. And to add yet another team of competitors to this aerial dogfight, you can already “order Walgreens health and wellness products through Wing’s delivery app” in Christiansburg, VA.
But what if you’re not home to greet your parcel as it’s tethered down to a safe landing in your yard? DroneDek is a new smart mailbox for drone package receiving and storage designed to accommodate and secure deliveries by aerial drone, even if you are not home at the time.
Coming back to earth, one existing solution for secure unattended delivery is Key By Amazon In-Garage Delivery. It allows their authorized driver to open your garage door to leave your parcels inside, thus transitioning your residential threshold only at this point.
Another inventive concept now in development by PoGo Door will facilitate hand delivery into the house interior through a special door panel. This “automated through-door delivery platform” is designed to enable “touchless, safe, automated deliveries through the threshold.”
A new smart data-driven mailbox concept, the ITSA Dropbox from Real Time Logistics, brings heightened transaction accountability to residential delivery by scanning a parcel as it traverses from an exterior mailbox into a decorative interior cabinet. The system simultaneously transmits the delivery transaction data to the customer’s mobile device. It’s positioned for adoption by IoT based “Smart Homes” as a tool to close the gap in today’s last mile of the supply chain.
And now, just in case transferring the parcel securely into the customers’ hands by either handing it directly to the recipient, securing it in a porch locker, dropping it into a receptacle from a drone, leaving it in the garage, or slipping it through a trap door, could there be any other inventive way to win at “Door Wars”? How about stowing it in a secure safe below ground? One more solution is offered by ShipSafeHome (The Future Lock Box and Mailbox, Secured Underground and Waterproof for Prevention of Package Theft, Mail Theft, Porch Pirates and More For Home Delivery or Last Mile Delivery”). As you can see, there is certainly an abundance of offerings for shippers who are attempting to come out ahead in the Door Wars!
John Callan is CEO, Ursa Major Associates, LLC.
This article originally appeared in the September/October, 2021 issue of PARCEL.