Last mile delivery challenges in India:
India’s e-commerce market is growing rapidly, and its untapped potential is yet to be explored. Billions of dollars are spent on marketing and creating awareness to develop a taste of e-retailing. However, this paradigm shift has rendered great challenges to logistics management, within which last mile delivery remains a costly affair and to overcome that there’s yet an awaited effective cost model. Last mile delivery account for 40% of total logistics cost, which may differ based on geographical factors.
Organizations are still thriving to come up with an effective model, however I believe aggregation still a viable option, provided, done effectively which can bring down cost improve efficiency.
In urban communities last mile delivery is majorly undertaken by the ‘Bike Riders,’ also delivery partner model is quite prevalent these days, wherein riders are operating as free-lance service partner on a variable cost model. This model while gives the freedom to the rider to increase their income, which shall be directly proportional to deliveries. Likewise, organization gets to take their hands off from statutory compliance and regulatory norms to comply. The greatest challenges of this model remains the lack of adequate supply of shipments to delivery partners, which would result lowering the potential of earning, therefore aggregation can be solution to ensure higher earning ability for riders and efficient cost for e-retailers.