11 Jun The future for 3PL’s and Last Mile Delivery
Logistics have changed too much during the last months due. The increase of online sales due to the pandemic brought new strategic partnerships between logistics participants. The future for 3PL’s and last-mile delivery is promising due to the necessity of the companies for improving their supply chain.
The Customized Logistics & Delivery Association (CLDA), the trade association for final-mile delivery companies, and the Transport Intermediaries Association (TIA), the voice of the 3PL industry made a joint whitepaper entitled The Age of Amazon: Why 3PL’s & Last-Mile Delivery Fleets Must Draw Closer.
This research shows four areas where 3PL’s and last-mile delivery providers have worked together to meet the increasing demands of consumers: E-commerce, Medical lab logistics, B2B and Special projects.
Online sales increased by 44% in 2020 to reach 21.3% of total retail sales due to people spending more time at home during the pandemic. Delivery of medical devices, exercise, and home office equipment purchased through e-commerce channels is an area of opportunity for fleets that can meet specialized delivery requirements such as setup and reverse logistics.
Medical Lab Logistics
Last-mile providers have seen their medical business increase significantly during the COVID-19 pandemic, including work transporting vaccines with hospital networks.
Motor carriers and 3PL’s are chasing opportunities in the last-mile of this sector to offer blended warehousing and delivery services that smooth order fulfillment for customers that experienced supply chain disruptions from COVID-19.
Last-mile fleets that operate facilities near large urban centers, like New York City, are seeing demand increase from shippers, 3PL’s, and motor carriers to utilize their local delivery services. Last-mile carriers separate volume loads into smaller shipments and make urban deliveries on repeat schedules, such as distributing shipments to retail stores.
Other relevant facts from this research were:
• The fourth quarter of 2020 was the strongest in the history of the last-mile segment.
• Last-mile fleets serviced 21% more stops in 2020 than in 2019. Much of the growth came after the April 2020 pandemic dip to reach a total of one-half billion delivery stops by year’s end across more than two dozen industry sectors.
• The last-mile delivery market in North America is expected to reach $44.88 billion from 2020 to 2024 at a compound annual growth rate of over 14%.
• Amazon continues its dominance as the world’s largest third-party logistics (3PL) provider, reaching 60% market share in the U.S. The company currently delivers to 72% of all Prime customers within 24 hours.
During the next years, 3PL’s and last mile delivery companies will continue their growth. The accelerated e-commerce’s swift rise and growing customer requests will contribute to the implementation of new logistics processes. Demand is driving the need for ever-greater efficiency in the supply chains of the companies. They know that differentiation is key to satisfy more clients and build one strong brand in the e-commerce market.
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MH&L Staff (June 7, 2021). Pandemic Demands Cause Major Shift in Supply Chain Provider Relationships. Retrieved from https://www.mhlnews.com/global-supply-chain/article/21166058/pandemic-demands-cause-major-shift-in-supply-chain-provider-relationships