The Future of Last Mile Delivery: 6 Trends to Watch in 2023
Are you ready for a glimpse into the future of local delivery? In 2023, the last mile delivery landscape will look very different from what we know today. With advancements in technology, changing consumer behaviors, and the need for speed and convenience, businesses are reimagining how they get products into the hands of their customers.
So what can we expect from local delivery in 2023? Here are six key trends that will shape the industry:
1. Sustainable Delivery:
Consumers are becoming more conscious and aware of their ordering habits, leading to a gradual increase in sustainable delivery. The fastest delivery options are not necessarily the most sustainable ones. Several organizations are taking adequate measures to reduce the carbon footprint of a delivery. They are using reusable packaging, optimizing their routes, and even using renewable energy sources to power their delivery vehicles. In 2023, sustainable delivery will continue to rise as consumers demand environmentally friendly delivery options.
2. Increase in Urban Warehouses:
As customers start demanding same-day deliveries, e-commerce companies will need to start building warehouses and hubs closer to the city. It has become essential to take advantage of the urban warehouse space to get instant access to products for fast customer deliveries. This not only reduces transit time but also makes access to delivery agents and laborers easier. With fewer people visiting physical stores, more retailers are using them as micro-fulfillment centers and delivering orders from the store. According to a WSJ report, Amazon is said to be in discussion with mall owners like Sears and J.C. Penney to turn them into fulfillment centers.
3. Quick Commerce:
The demand for faster deliveries has led to e-commerce giants focusing more on logistics services. In India, the quick commerce (Q commerce) segment is projected to grow 10-15 fold in the next five years and become a $5 billion opportunity by 2025. Q commerce delivers essential items within 10 to 90 minutes of an order being placed. In 2023, e-commerce companies will achieve faster delivery service level agreements (SLAs) by building a network of highly optimized micro-fulfillment centers. These centers will be strategically placed in different areas to enable faster deliveries, providing customers with their products at lightning-fast speeds.
4. Contactless Delivery:
The pandemic has led to a surge in contactless delivery, with close to 40% of US consumers preferring this option due to safety concerns. Delivery companies are exploring different ways to maintain safety and provide an excellent customer experience. Last mile delivery companies are embracing automated delivery processes via digital solutions like Electronic Proof of Delivery software (e-POD) and digital payments to minimize contact. Companies will continue to focus on contactless delivery in 2023 to ensure complete safety for delivery agents and customers.
5. Drones and Delivery Bots:
Several retailers are looking to experiment with robotic deliveries using drones, self-driving vehicles, and autonomous delivery bots. Retail giant Amazon recently invested over $500 million in autonomous technology developer Aurora. Few companies are also pursuing the delivery bot solution for last mile deliveries, while others are embracing autonomous robot delivery providers. However, these new-age delivery solutions will need approval from local governments and undergo regulations before they can be put into use. In 2023, we can expect to see more testing and experimentation with these new delivery solutions.
6. Smart Tracking with Location Intelligence:
Retailers and logistics companies are embracing technologies like location intelligence (LI) to improve their last mile delivery. Features like real-time tracking, route optimization, and visibility are helping them with seamless deliveries and fleet management. The right LI platform helps companies keep their customers informed about the exact location of an item.