What is the most difficult difficulty facing any eCommerce company today?
“Meeting delivery requirements”! Even an eCommerce behemoth like Amazon had been grappling with a lack of control over its deliveries for years before Jeff Bezos, the company’s founder, chose to use a last-mile delivery strategy.
During the current epidemic, demand for delivery services and entire foods was at an all-time high, prompting Amazon to investigate the last-mile delivery method for their logistics.
They went beyond simply implementing a last-mile strategy by allowing delivery services to collaborate. So, if you’re having trouble keeping track of your eCommerce deliveries and want to know what last-mile delivery is, here’s an in-depth look at last-mile delivery the Amazon way!
Amazon’s In-House Logistics History
Same-Day Deliveries in 2009
Let’s go back to 2009 to get a sense of the scale of Amazon’s in-house logistics evolution. Amazon launched same-day deliveries under the banner of Local Express Delivery when the globe had yet to be introduced to today’s express delivery idea.
The delivery service was first limited to cities such as Seattle (Amazon’s headquarters), New York, Philadelphia, Boston, Washington, D.C., Baltimore, and Las Vegas.
Through acquisitions such as KEVA robotics, Amazon continued to improve its logistics and delivery capabilities incrementally from 2009 to 2013. (2012).
Operation Dragon Boat was launched in 2013.
Through “Operation Dragon Boat,” Amazon’s executive management chose to take their in-house logistics skills and last-mile experience to the rest of the world in 2013. Jeff Bezos stated in December of the same year that Amazon Prime Air, a fleet of 30 drones for last-mile deliveries, was in the works.
Last-Mile Delivery on Amazon
The expansion of Amazon Air’s fleet is a push for logistical dominance – Supply Chain Dive.
The goal of Amazon Prime Air was to improve in-house logistics’ last-mile delivery system. However, regulatory hurdles and air traffic standards have stymied Amazon’s plans to launch Amazon Prime Air.
Raising the Bar in 2014
So, in order to expand, Amazon required last-mile delivery methods, and they opted to build their own. Amazon purchased a 25% stake in two shipping companies, Yodel and Colis Prive’, in 2014.
Amazon Prime Now in 2015
Amazon Prime Now, one of the key components of Operation Dragon Boat, was released in 2015. For 1-2 hour delivery, the eCommerce behemoth has 58 delivery hubs across the United States. It was Amazon’s attempt to establish a cost-effective and lean last-mile delivery system.
What Is Amazon Prime Now and How Does It Work?
It was time to enter the on-demand scene after the enormous success of Amazon Prime Now. Unlike Uber and Postmates, Amazon already had the infrastructure for an on-demand service in place. Enter Amazon Flex, an on-demand delivery service delivering goods from Amazon’s warehouses to customers.
Each driver is part of the sharing economy, which aids Amazon’s order fulfillment. If you’ve ever wondered what the ideal last-mile delivery service is, Amazon Flex is the solution!
Colis Prive’ was purchased in 2016.
With the acquisition of Colis Prive in 2016, Amazon improved the confidence of experts in their delivery capabilities. It was a full-fledged delivery company in which Amazon had made a 25% investment a few years before.
However, due to the high demand for holiday deliveries such as Christmas and Thanksgiving, Amazon sought to take control of delivery schedules and acquired a shipping company.
Amazon Logistics in 2018
In 2018, Amazon will start its “Amazon Logistics” last-mile delivery service. This was a move to cut the eCommerce behemoth’s fulfillment and shipping expenses, which had risen to $34 billion and $27 billion in 2018, respectively.
Free Same-Day Delivery in 2019
Amazon’s in-house logistics system had finally reached its full potential, and the eCommerce behemoth began delivering free one-day deliveries to demonstrate its capabilities. This move was critical because demand for same-day or two-day delivery has increased by 92.8 percent by 2019.
Amazon Robotics Program, 2020
The Amazon Robotics Program was launched by Amazon to encourage new delivery businesses and entrepreneurs to provide last-mile delivery solutions for the eCommerce giant. Here’s a look at Amazon’s automated last-mile delivery services in action.
Ahead of 2021
For its transportation needs, the corporation wants to add 12 new Prime Aircrafts, bringing the overall number of Prime Aircrafts to 82.
By the end of 2021, Amazon plans to open an Air hub for last-mile delivery services at the Cincinnati/Northern Kentucky International Airport.
Beyond 2021, the Prime Air program will include a fleet of more than 200 aircraft.
Do You Need to Develop In-House Logistics for Your Company?
For many entrepreneurs and startups, Amazon’s journey is encouraging and inventive. Here are some reasons why you should consider creating in-house logistics for your company if you’re not sure what last-mile delivery is.
Improved Control
The necessity for such a last-mile delivery system developed because Amazon desired tighter control of their deliveries, following Amazon’s in-house logistics strategy.
As a business, a 3PL, or third-party logistics, can be aggravating, especially when it comes to delivery management. The control over schedules, costs, and product handling is lost when product delivery or shipping is outsourced.
Last-Mile Delivery System by Amazon
Last-mile courier tracking and control can be made easier with in-house logistics. This is especially important because the last-mile is the face of your company that communicates directly with customers.
Management Simplicity
Managing shipments and fleets with an outsourced provider is difficult because you are dealing with an external staff. In-house logistics, on the other hand, includes your complete staff, making management much easier. It also speeds up the decision-making process.
Collaborations
Collaborations with delivery partners and merchants can be more flexible with in-house logistics systems. The whole warehouse, shipping, and supply chain team is familiar with your business process, allowing them to effortlessly engage with merchants on last-mile delivery services fulfillment.
Let’s talk about the necessity of last-mile delivery and why it’s difficult to establish one now that you’ve learned about the advantages of in-house logistics.
The Importance And Challenges Of Last-Mile Delivery
- Last-Minute Shipping
- Last-Mile Delivery Services’ Importance
- Deliveries that are more timely
If you’re unsure what last-mile delivery service is or how it affects delivery times, Amazon is the best place to start. Consider the Amazon Flex, which employs an UberRush-like approach to expedite deliveries. Similarly, by dividing down shipments into separate shipments, the last-mile method lowers delivery delays.
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Delivery Management for Amazon’s Last-Mile Delivery System
The administration of deliveries becomes simple with concepts like last-mile courier tracking. The last-mile delivery technology streamlines the process by allowing all actions to be managed from a single dashboard. With the last-mile approach, you can easily track every order detail, allocate deliveries, optimize routes, and manage the entire process.
Chain of Logistics
One of the most important aspects of the logistics chain is the last-mile approach. The chain starts at the factory, where the product is made and shipped to warehouses.
Last-Mile Delivery System by Amazon
Goods are transferred from these storage facilities to the distribution center, which is when last-mile delivery services come into play. Last-mile delivery refers to the delivery of items from a distribution center to a customer’s location.
Issues with Last-Mile Delivery Services Increased Costs
The expense of last-mile delivery is one of the reasons why eCommerce behemoths like Amazon emphasize it. The execution of last-mile delivery services determines the cost of fulfillment and shipping. Aside from ordinary delivery fees, there are costs associated with same-day deliveries that place an additional burden on the budget.
Transparency is required.
Consumers today expect every last detail of their orders. Investing in infrastructure and technology to keep up with the demand for last-mile courier tracking is necessary. Customers want comprehensive visibility of the product in transit, which is difficult for many eCommerce enterprises with the emergence of on-demand services.
Keeping Your Efficacy
Maintaining the efficacy of deliveries is one of the most difficult tasks. Delivery timetables were frequently inefficient due to the diversity of locales and infrastructure concerns. Many eCommerce businesses find it difficult to compete with Amazon in this area. However, Amazon’s secret to last-mile effectiveness is a smart delivery technology that allows for a better user experience.
Conclusion
Amazon isn’t going to stop at a few warehouses or distribution centers. The e-commerce behemoth is vying for supremacy in the last-mile delivery market. So, if you’re still confused about what last-mile delivery is and how to use it to grow your business, it’s time to start putting together your own logistics system.
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