Gadget

How to solve the ecommerce last mile

The combination of multiple delivery routes, packing and packaging, and dispatch waiting times saddles ecommerce businesses with prices that, on average, range from R90 to R900 per package.

Particularly for smaller ecommerce businesses, these costs can be devastating.

But with South Africa’s online retail sector in a boom period and the local industry expected to be worth R100-Billion by 2026, according to the World Wide Worx Online Retail in South Africa 2024 report, solutions need to be found—and fast.

Anita Erasmus, Head of Business at South African ecommerce ecosystem Bob Group, adds that in addition to the general costs associated with last-mile delivery, fuel costs and security expenses are also negatively impacting the industry.

“Fuel is notably expensive in South Africa, directly impacting delivery costs. Additionally, courier companies incur extra expenses to ensure the safety of both their drivers and parcels, which further increases the total cost,” she says.

Another factor escalating last-mile delivery costs is the nature of deliveries themselves. Typically, these involve single parcels being delivered to individual recipients, and since deliveries are not consolidated, drivers spend considerable time reaching each specific destination.

Erasmus says effective last-mile delivery management must be implemented from “day one”. Even shipping a single parcel each month can directly influence an ecommerce business’s overall level of service.

“As shipment volumes increase, manual management becomes increasingly challenging. This is where leveraging technology to streamline the process can be highly beneficial.

“Platforms like Bob Go and similar services offer tailored plans for businesses of varying sizes. It must be remembered that as order volumes rise, so too do shipment numbers. This, in turn, increases the likelihood of errors. Implementing technology early on can significantly reduce this risk and ensure a smoother delivery process.”

Erasmus points to several innovative and cost-effective strategies for last-mile delivery that can assist South African ecommerce businesses. These include:

However, Erasmus quickly adds that these options are not a” one-size-fits-all” solution; instead, the most effective approach often involves combining strategies.

“It’s crucial to evaluate each option’s technical capabilities, specifically how seamlessly they can integrate with your ecommerce store to ensure a smooth and efficient workflow.”

In any ecommerce business, the operations manager usually oversees these processes. This individual must be able to multitask effectively.

He or she must also have exceptional analytical skills to interpret data related to last-mile delivery.

“Additionally, they should be adept at managing relationships with partners, especially courier service providers. Striking the right balance between maintaining a firm approach and fostering a positive working relationship is essential for ensuring smooth operations,” Erasmus says.

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