The hurdle of the Last Mile – How to leap over it!

Connectivity is a vital cog in ecommerce delivery. Particularly in India, the last mile is the most important and the most difficult part of reaching the customers. While currently most ecommerce companies are not overly worried about their loss-making enterprises, the near future will tell a different tale. Investors will expect to see some profitability in the ventures they have invested in.

Every product based online company will have to focus on maintaining a strong and smoothly run enterprise that is capable of churning out significant revenue. Having a reliable supply-chain is essential towards this end.

Lessons to be learnt from physical stores

A product based company has to focus on building an error free supply chain system, which completes the process of creating, producing and selling the products at a reasonable rate. Hewlett Packard (HP) recently discovered that it was going through a phase where its inventory was piling up and the delivery was sluggish. To offset its expenses, the company devised a modified version of its current process.

The company worked out a streamlined model of manufacturing, which helped the movement of the backlog in its inventory.

Githa Heggde and Deepak Shyam, faculty at Welingkar Institute of Management, Bangalore, point out that the ecommerce industry is heavily dependent on IT to run its logistics. This premise is flawed, as a tailor made solution has to be created for individual organizations.

Problems of the last mile in Indian ecommerce

Ecommerce has found itself skirting a common issue of reaching out to the farthest corners of the country. While some companies have devised pick-up points, built warehouses at different places and tied up with logistics companies, these problems still abound. India Post has entered into a strategic relationship with leading ecommerce companies. This has helped immensely, as the postal department has access to nooks and crannies of the country; a luxury that modern logistics companies are yet to enjoy.

However, this is also fraught with problems. Heggde and Shyam suggest a constant monitoring of the supply chain to spot discrepancies, fix them immediately and also a scale up the system based on the rapidly changing operational scenario.