By Megan Harman
As e-commerce sales grow, retailers and logistics companies are facing significant challenges in facilitating the shipment and delivery of a high volume of goods – particularly during the busy holiday season. Many companies are embracing mobile technology to help manage these challenges.
“E-commerce is continuing to gain traction in Canada and the rest of the world,” says Suneil Sastri, director of product marketing at software company SOTI Inc. “Online sales are going to continue to grow somewhere between 8-10% year-over-year over the next three years, until it hits about 10% of total retail sales in Canada by 2020.”
A significant proportion of those online sales occur between the end of November and the beginning of January. That means huge volumes of goods are being shipped around the world in a relatively short period of time.
Canadian courier Purolator Inc., for instance, recently reported that it anticipates it will move approximately 20 million packages this peak season. And U.S. multinational courier company FedEx Corp. expects to ship 380-400 million packages worldwide during the busy holiday shopping season.
“Ultimately, this has been a boon for transportation companies and parcel delivery companies, including postal services,” Sastri says.
However, the surge in business is also creating challenges for these companies. With e-commerce companies such as Amazon offering same-day and one-day shipping, logistics companies must find ways of operating more efficiently than ever before, Sastri says.
“Because there are higher volumes of deliveries and there is pressure for fast and reliable deliveries, they need to be able to be better coordinated across their entire supply chain,” he says. Companies also need to find ways of minimizing costs in order to remain competitive, he adds.
Mobile technology is one tool that logistics and transportation companies are embracing to navigate these challenges. For example, Sastri says many companies are using RFID scanners in their warehouses to track goods. In addition, many transportation companies are equipping their truck drivers with tablets, which can help provide drivers with relevant pick-up and delivery information, as well as traffic information to optimize routes.
“Mobile technology is one of the keys to helping companies overcome the challenges across their entire supply chain,” Sastri says.
Embracing mobile technology can help companies deliver items faster, Sastri says, but more importantly, it improves reliability. By being able to track the location of an item, logistics companies can more efficiently coordinate the pick up and delivery of items, and track the process from end to end.
“If you can’t meet your delivery windows, it will cause angst among your customers,” he says. “Mobile technology really guarantees the reliability and confidence in regards to that same-day, one-day or even two-day delivery.”
A growing number of retailers are also embracing mobile technology into their businesses, Sastri adds, as consumers increasingly demand a seamless experience when shopping both online and in stores.
“As you look at these new digital consumer behaviours, it extends beyond [online sales],” he says. “Consumers are looking for this better omni-channel experience.”
For example, Sastri says many retailers are equipping their sales associates in stores with mobile devices. That enables store employees to help customers search for products and conduct transactions on the spot, rather than forcing customers to wait in line for a cashier.
“It makes that shopping experience better,” he says.
Megan Harman is a business reporter based in Toronto. She writes about topics including retail, financial services and technology. Megan covers Toronto’s retail industry through her blog Retail Realm (torontoretail.wordpress.com). Follow her on Twitter at @meganmharman.