Last Mile Delivery – The Battle Over Home Deliveries

Same day delivery and control over all last mile deliveries is a battle now being fought by the heavyweights of internet retailing Amazon, Google, Walmart, and eBay. They will be battling each other together with entries made by smaller retailers and logistics companies – 3PLs. This battle will be fought with the winner or winners being the companies that create true competitive advantage via its execution. Execution can carry great risk and investment such as Amazon who recently announced that it will operate its own fleet of trucks driven by contract drivers in large urban markets and this strategy is underway. Apparently Amazon does not want to cede control to FedEx or UPS and they believe they can operate at a lower cost. It will be very interesting to see how this plays out. The challenges to successful implementation are major and some obviously are cost, time, staffing and managing labor, and making significant systems investments to name a few. Will Amazon’s strategy work, will its home delivery be more efficient than FedEx and UPS, who have significant track records and have already made the investment. Will the battle benefit the local and regional parcel, couriers and messenger service providers … most likely. Will participants other than Amazon continue to utilize FedEx and UPS and perhaps supplement with local couriers? What will FedEx and UPS do, sit on the sidelines? Not likely.