Rapid advancements in technology have shifted customer behavior and attitudes in recent years. At the same time, technology has fueled the expansion of on-demand services through digital channels which offer consumers immediate access to goods and services in areas such as food delivery, e-commerce or even healthcare, along with convenient and speedy delivery, in some cases, on the same day.
The ongoing Covid-19 pandemic will continue to accelerate this trend as consumers purchase more and more online amid lockdowns and restrictions.
The on-demand economy is set to soar, reaching a whopping US$335 billion by 2025, thanks to the accelerated growth of digital services worldwide.1 The rise of e-commerce and the on-demand economy gives Small-and-Medium Enterprises (SMEs) a unique opportunity not just to boost sales, but to position themselves for long-term success.
To do so, SMEs will need to create an effortless digital purchasing journey that extends beyond checkout. Research has shown that high shipping costs and unsatisfactory delivery options are two of the most significant reasons for consumers to abandon purchases in their virtual shopping carts. This makes it critical for SMEs to employ digital solutions to differentiate their last mile deliveries to beat the competition, win new business and retain customer loyalty.
Logistics players continue to invest in disruptive technology to help businesses navigate the challenges of the on-demand economy. SMEs should leverage these innovations to make deliveries efficient, cut costs, and improve profitability amid the rise in online orders.
Here are three hot trends in delivery technology that will help SMEs succeed in the on-demand economy.
1. Rapid And Effective Inventory Management: 5G
5G is a game changer as it offers data speeds 20-times faster than existing 4G long-term evolution (LTE) networks; helping to promote the mass adoption of Internet of Things (IoT) by significantly increasing the volume of data and speeds at which the data can be analyzed; and information exchanges across different devices.
In the logistics sector, the emergence of ultra-fast 5G technology can help providers improve their ability to use analytics-based solutions to better manage their inventory and supply chains, resulting in higher accuracy and speed in reaching end customers.
As more IoT and data analytics solutions are being used among both B2B and B2C companies, 5G brings new promise of powering near real-time data analytics, so businesses can make more informed decisions, faster. Solutions like FedEx Surround, a platform that provides artificial intelligence and machine learning to predict excursions caused by weather or traffic conditions to avoid logistical slowdowns before they occur, could be widely used among businesses.
5G technology is also accelerating the development of autonomous vehicles that are currently being tested in several countries. This gives us a glimpse into the future of logistics where self-driving vehicles become more common, further accelerating last-mile delivery services.
2. See The Whole Picture: The Smarter Way To Track Deliveries
Letting customers know the status of their packages is now the norm in the e-commerce ecosystem. Going a step further, smart sensor technology now enables customers to know the exact location of an item in transit with pinpoint accuracy, and even the exact environmental conditions their package is in. This is a game changer for high-value packages, food ingredients, chemicals, bio-samples and so on.
Real-time location tracking and communication capabilities are more effectively connecting drivers and customers and as a result, improving the customer experience.
Advanced solutions such as FedEx SenseAware are being used in mission-critical sectors such as the healthcare industry. With SenseAware, customers in the healthcare space can receive near real-time updates on the location of their shipment which could be vaccines, critical medicines and other time and temperature sensitive products, for instance, thus improving the safety, security and timeliness of deliveries. The adoption of SenseAware technology is just one of the examples of how logistics companies can leverage innovative technology to enhance shipment visibility and deliver a new level of precision, transparency in tracking packages.
3. Get To The Finish Line Quickly & Seamlessly: Robotic Deliveries
Rising demand for contactless services in the wake of the pandemic is helping drive demand for autonomous solutions.
McKinsey estimates that autonomous vehicles will deliver 78% of items globally in the future, with traditional delivery accounting for only 20%. Already, a growing number of businesses in Asia are starting to experiment with robotic delivery in the form of self-driving vehicles and autonomous delivery bots.
Singapore, for instance, is in the midst of a one-year trial of autonomous robots to make deliveries in the north-east of the island, paving the way for wider use of robot “couriers” for on-demand delivery services. Autonomous delivery vehicles were also deployed in Chinese cities during the pandemic last year.
Asian cities are showing growing appetites for adopting autonomous technologies. In Japan for instance, a global leader in robotics technology, companies hope to optimize robotic technologies to tackle multiple issues, such as easing traffic congestion, enhancing productivity as well as addressing issues due to aging populations.
With this in mind, FedEx recently introduced its autonomous delivery bot RoxoTM in Japan. The robot is designed to travel on sidewalks and along roadsides, safely delivering smaller shipments to customers’ homes and businesses. Consumers thereby can enjoy same day, contactless delivery services at their doorsteps.
FedEx just announced its collaboration with Neolix, a leading company in autonomous technology, to test an autonomous delivery vehicle in China. This is the first time in its operations in China that FedEx has cooperated with a local Chinese technology company to test the use of a driverless vehicle. This is just the latest effort the company is taking to embrace technological innovation and deploy autonomous vehicles to drive sustainable and intelligent logistics in this region.
Advanced logistics solutions such as these can help fuel the growth of businesses, including SMEs, and ensure that they remain relevant long into the future.
You can find more insights from FedEx on the future of technology and logistics in Asia Pacific at FedEx Business Insights.