Last-Mile LogisticsConsiderations and Challenges Mid-Pandemic

By John Cox,

National Accounts, Technical Transportation

Technical Transportation, Inc

The logistics industry – like so many other industries around the world — has spent the past year surviving, adjusting and finding ways to forge ahead in light of the COVID-19 pandemic. And although we’re still working through this challenge, there’s hopefully a light at the end of the tunnel with the recent vaccine announcements.

Until then, the industry is still dealing with various challenges that have presented themselves this year — everything from shipping delays, infrastructure issues, and meeting demand for product. One such challenge has been how both businesses and consumers have adjusted their processes and decision making, which has had impacted the last mile sector.

Especially in places of brick-and-mortar businesses or in healthcare settings — where the safety of the workers and customers onsite is a pivotal concern – last mile and white glove delivery services have been met with some unique challenges this year. Following are some of the ways the industry has had to adjust.

SAFETY FACTORS

Safety has been a top priority and the main area of concern for everyone involved in human interactions during the last mile, including shippers, delivery crews, and consignees. Most customers have higher expectations in light of COVID-19, such as full visibility into your revised pandemic processes and the assurance that all safety checks are in place. If you can’t demonstrate those capabilities, then many manufacturers won’t work with you.

Safety processes include fever screening, symptom surveys, recent social interactions, and travel history statements for all persons involved in the shipment. This ensures everyone in the field and those they come in contact with are as protected as possible. Such processes have simply become a routine part of day-to-day operations, and will continue to be so for the foreseeable future.

These new measures and precautions have introduced additional expenses to last-mile operations, including the need for continuous:

• Personal protective equipment (PPE)
• Supplies and manpower for sanitization of equipment
• Staggered shifts to ensure appropriate employee distancing
• Additional employee time for documentation and assistance with health checks

Capacity is also an issue, due in part to government protocols and guidelines that are adding more pressure on the pre-existing driver shortage in the industry.

For example, for any driver who is symptomatic or comes into contact with someone exposed, they and their team are required to quarantine for 10-14 days. With such a small pool of drivers and equally skilled field workers currently available, the potential for reduced capacity is very real, should COVID strike at your workplace.

ECONOMIC FACTORS

These safety observations and issues, combined with some unique economic issues, will make the fourth quarter of this year pretty interesting, and busy, for last-mile operators.

Traditionally, Q4 always rivals or takes the crown for the busiest final-mile operations of both B2C and B2B companies – primarily due to the hockey-stick demand with holiday spending and end-of-year purchasing patterns. There are a couple of wrinkles this year; however, that are expected to make Q4 potentially memorable.

The first wrinkle is the increase in online shopping due to the pandemic. According to a survey conducted by Salesforce.com, the COVID-19 pandemic has caused a shift in how people interact with companies, moving from a majority favoring offline interactions in 2019 to more people favoring online interactions in 2020.

The study specifically showed that in 2019, 58 percent of interactions were offline versus 42 percent online. That trend flipped, however, this year with 60 percent favoring online vs 40 percent offline.

More than 58% of those surveyed in 2020 said they plan to increase their online shopping post-pandemic versus pre-pandemic. Of all B2B purchasers surveyed, 80 percent expect to purchase more online, post-pandemic.

A second wrinkle is the timing of Amazon Prime Day this year. Typically held each July, this year it was held in October to the tune of nearly a 50 percent increase in sales activity from Prime Day a year ago.

What that means is the holiday rush began even earlier this year, and with many people turning to online shopping, the transportation industry has faced — and will likely continue to face — the threat of shipping delays and backlogs that could persist for much of the quarter.

A PERFECT STORM?

When you combine today’s more restrictive operating environment for safety reasons with an increasingly higher demand for delivery services, it can create a perfect storm for bottlenecks and delays.

While some logistics companies may not be directly involved in the consumer eCommerce supply chain, they will still be impacted by what’s happening in the industry.

Some B2B providers are actually taking advantage of this online purchasing trend by dipping their toes in the B2C eCommerce arena to boost sales. By doing so, however, their account management and logistics teams have been pulled away from their typical duties, thus stretching already thin resources and diluting their B2B operations. If not managed properly, this new activity level can cause errors and delays in areas that require more specialized attention and complex service as part of the last mile delivery.

For manufacturers who may be working with such partners, they may find their service levels affected due to a shift in priority from their logistics team. For manufacturers with complex 3PL needs, it is critical now, more than ever, to look for a provider that has remained dedicated to your space and has focused their full effort on your needs.

Slowly but surely, we will move beyond this pandemic, but for now we must focus on the issues and challenges that are immediately affecting the supply chain. At TechTrans, we continue to focus all our efforts on meeting the needs of our clients with complex shipments or specialized equipment to mitigate the challenging trends facing our industry, and to stay on track while we work our way through these unprecedented times.