Same-Day Delivery is a returning topic on Logistics, Supply Chain and e-Commerce news sites and blogs. It all started about a year ago when large online and offline retailers launched Same-Day Delivery services.
The Traditional Model
These retail/e-tail giants used the traditional model for getting the goods to their end customer, at least at the start. Some used parcel shippers. Others launched their own fleet of vehicles with their own couriers.
Large e-tailers have huge distribution centres (big stock, high availability, an advantage) scattered regionally, usually not in the middle of densely populated areas (a disadvantage). Retailers can combine regional distribution centres with their network of brick & mortar stores (smaller stock, a disadvantage) with stores in almost all densely populated areas (an advantage).
Delivery is Not the Moneymaker
e-Tailers are more experienced in delivering goods to consumers. Retailers have a geographical advantage. Retailers and e-Tailers have another thing in common: they offer this service for (next to) nothing. They are not making money on the delivery, but they want to turn you into a returning customer.
Start-ups Disrupting Traditional Delivery
Several start-ups have used a very different approach to tackle the Same Day Delivery challenge. A few well-known examples are Zipments, Deliv, and Shutl. These start-ups combine technology with the marketplace to connect consumers, retailers, e-tailers and couriers. For example, deliveries can be announced through an app and then couriers can claim the delivery when they are in the area. In such a system, couriers could specialize in these deliveries or use them to fill the empty miles after a drop-off or add shipments to existing shipments in the same area, next to their regular business. Potentially even taxi or limo drivers, or actually anyone with a means of transportation, could join in. Start-ups like these are in it to make money from the service they offer, contributing to their innovative approach.
Recently, both groups came together, as eBay recently bought Shutl to enhance their Same-Day service, combining the traditional service of contractors that drive eBay Now branded vehicles with the more cost-effective marketplace approach described above. I guess they are learning.
One of the Shutl service’s key features that caught my eye was the 1-hour window, which customers can choose for delivery. Not knowing when an important delivery will be made forces you to be home for an extended period of time or risk missing the shipment. And you know the courier will drop by at the exact time you ran out for a quick errand.
On-Time More Important Than Fast
The key question is: do consumers really want Same-Day Delivery? Recent research has shown that consumers find it more important to know exactly when the shipment will be delivered than getting it delivered in the fastest way possible. Same Day Delivery is pretty much still a luxury service. I’m sure that it will become more common when last-mile delivery gets more efficient and the cost (and price) goes down.
There are parties on the horizon that are about to take Same-Day Delivery to a whole new level. And you may take this far more literal than you think. You will no longer have to be at home looking out the window, waiting for the courier to deliver your package. No! You can be anywhere, and you will probably be looking up…
