The Last Mile Supply Chain Disruptions of 2023

by | Oct 24, 2022 | Blog, Returns Automation

The digital economy is changing at an unprecedented pace, and so are the companies that operate within it. Supply chains have been disrupted time and time again, but with each new iteration, the disruption has become more comprehensive. Today’s digital economy is leading to a greater emphasis on data-driven decision-making in every industry. This goes hand in hand with the ubiquity of information technology as a whole. The more we share, connect, collaborate and digitize — the more opportunities there will be for disruption in general. However, what specifically are these supply chain disruptors of tomorrow going to look like? And how will they impact your company? Let’s take a look:

The Rise of the AI Supply Chain Disruption

Nearly every industry is being impacted by the rise of AI — from finance to health care and beyond. AI is already being used to slash costs in the logistics sector, helping companies improve efficiency and increase performance. However, it’s also poised to be a key factor in the future of supply chain management.

AI has the potential to help companies more precisely target their inventory and forecast demand. This, in turn, can help increase efficiency and reduce costs. In fact, one report predicts that the global AI market will grow from $387.45 billion in 2022 to $1,394.30 billion by 2029. This growth is being driven by the adoption of AI in particular, and the logistics sector in general. Companies are using AI to improve their operational efficiency and manage their entire logistics process. Thanks to the rise of smart systems and connectivity, this is now possible across virtually any industry.

The Fomo Network Effect

The “FOMO” network effect is a term that was first coined by Brian Chesky, the co-founder, and CEO of Airbnb. It stands for “fear of missing out” and refers to the way in which people are drawn to things that they believe others are doing or enjoying. This same principle can be applied to the world of supply chains. In a FOMO network, companies are constantly trying to one-up each other in terms of speed, efficiency, and overall performance. This can lead to a race to the bottom in terms of prices, as well as a general feeling of anxiety among companies.

The FOMO network effect is already starting to take hold in the world of logistics. In particular, companies are feeling pressure to offer same-day or even instant delivery in order to keep up with the competition. This is likely to lead to further consolidation in the industry, as well as an increase in shipping costs.

The “Uberization” of Last Mile Delivery

While Uber has had a major impact on the world of transportation, it’s also starting to have an impact on last mile delivery. This is because Uber has demonstrated that there is a demand for on-demand, door-to-door service. As a result, a number of companies are now offering similar services for deliveries. While some of these companies are still in the early stages of development, they have the potential to disrupt the last mile delivery market. This is because they offer a more convenient and customer-focused service than traditional delivery companies. In addition, they are also much cheaper to use. As a result, we can expect to see an increase in the use of these services in the coming years.

The Rise of Electric Vehicles

Electric vehicles are starting to have a major impact on the automotive industry. In particular, they are starting to make inroads into the commercial vehicle market. This is because electric vehicles offer a number of advantages over traditional petrol or diesel-powered vehicles. They are cheaper to operate and maintain, and they emit no pollutants. In addition, electric vehicles have a much lower carbon footprint than traditional vehicles. As a result, we can expect to see an increase in the use of electric vehicles in the last mile delivery market. This is likely to lead to a reduction in emissions, as well as a reduction in costs.

The Impact of COVID-19

While it’s still too early to say definitively, it’s likely that COVID-19 will have a major impact on the last mile delivery market. In particular, the pandemic has led to a significant increase in eCommerce activity. As a result, there is likely to be an increase in the demand for last mile delivery services. In addition, the pandemic has also led to a number of changes in consumer behavior. For example, people are now more likely to order items online and have them delivered to their door. This is likely to lead to a further increase in the demand for last mile delivery services.

The Blockchain Supply Chain Disruption

While it’s still in its early stages, blockchain technology has the potential to disrupt the last mile delivery market. This is because blockchain provides a decentralized and secure way of tracking and managing data. In addition, blockchain can also be used to create smart contracts. These are contracts that automatically execute when certain conditions are met. As a result, blockchain has the potential to make last mile delivery services more efficient and secure. In addition, blockchain-based applications could also be used to track the progress of deliveries and ensure that they are delivered on time.

Bottom Line

While there are a number of potential supply chain disruptions, it’s still too early to say definitively which ones will have the biggest impact on the last mile delivery market. However, the rise of electric vehicles, the growth of eCommerce, and the impact of COVID-19 are all likely to lead to an increase in the demand for last mile delivery services. Elite EXTRA is primed and ready to assist with any future disruptions. Our technology-driven solutions are designed to help you overcome any challenges that you may face. Contact us today to learn more about how we can help you overcome the last mile challenge.

Mallorie Barabas

Mallorie Barabas

Author

Mallorie is the Marketing Strategist at Elite EXTRA; if you ask her about her job, she will immediately tell you to follow @EliteEXTRA on LinkedIn (that is your cue;) When she isn't at the office, you can catch her teaching aerial yoga, swimming, or just generally enjoying the outdoors.

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