Demand-Driven Logistics: Consumer Direct and the Last Mile

Consumer-Direct Channels

With retail storefronts under siege, the smart move for manufacturers is to strengthen your consumer-direct channels.

Since retail foot traffic will be down for the foreseeable future, this paper describes how network-based strategies help suppliers protect the business with the ability to better match supply and demand, increase real-time responsiveness, and enable world-class logistics execution capabilities down to the last mile.

All of this will improve service levels, create a great customer experience, and increase loyalty and market share.

Is it possible to move to smaller order quantities and actually decrease costs at the same time? Yes, as long as real-time network visibility and collaboration are used to reduce variability for all trading partners and eliminate information lead times across all tiers and echelons in your supply chain.

There’s Change. And Then There’s Permanent Change

Consumer-driven needs and behavioral shifts have generated a rapid and ongoing shock to most supply networks since the start of the COVID-19 disruptions.

This shift has created structural change in our supply chain networks that will change business processes as well. In many cases, the associated deployment of these new processes will achieve permanence across industry sectors over the next two years.

For example, buying behaviors that may have taken a decade to evolve in normal circumstances have been forced front-and-center by virus-related restrictions.

Government-mandated quarantines have driven a global increase in ordering food, groceries, pharmaceuticals, and other essential needs online. Even for non-essential goods, businesses have seen an enormous surge in ecommerce.

Where consumers would ordinarily have gone to a local retailer, the transaction has shifted online or direct from the manufacturer.

What’s Needed is a Real-Time Reach Across All Tiers in The Supply Network

What’s needed goes well beyond a basic ecommerce platform. It includes a complete supply chain solution with integrated multi-tier inventory optimization, order brokering, merge, and cross-docking, including last-mile delivery, and the ability to create an allocated Available-to-Promise (ATP) for order promising to a delivery window in a home within a few hours. And all this needs to be optimized on cost.

A tall order? Perhaps not. Today’s network platforms make it possible, and in this way, you’ll enable your whole ecosystem to capitalize on the shift toward direct-to-consumer and achieve a fast ramp in consumer-driven last-mile deliveries. And you’ll be fully prepared as economies recover.