Australia - DHL evaluates Uber-style model for 'last mile' parcels delivery

05 Sep 2017, 15:24 ... f62d35a3a2

The e-commerce division of the world’s largest logistics company could use an Uber-style model to deliver parcels directly to homes under plans it is considering to enter the so-called “last mile’’ delivery market in Australia.

Earlier this year DHL eCommerce, a division of the world’s leading logistics company Deutsche Post DHL Group, established a fulfilment centre in Sydney to capitalise on the rapid increase in Australians buying goods online from overseas and the growth of internet retailing.

While last-mile deliveries from the centre are currently done using Australia Post’s StarTrack courier service, DHL eCommerce global head Charles Brewer said the group was considering using a “capital light’’ model to capitalise on the double-digit growth in revenues it is enjoying in Australia.

“Do we want to play in this space in Australia? That is a question we need to answer over the next few weeks and months. Last mile is the one that excites most people we talk to,’’ Mr Brewer told The Australian.

“The volume is there. The market exists. The question is can you create a sustainable proposition in that space? There are very good established players here. Can we create a sustainable product which our customers would love? Australia is a great market, a big market, I like the look of it, but we need to do our maths.’’

In the US DHL eCommerce is trialling a radical crowd-sourced approach to deliveries.

“We own the customer and technology but the delivery model is open. Anybody who can meet minimum standards can deliver for us. People can sign up for 10 to 20 hours of work. We are doing it in Chicago and are about to start Los Angeles,’’ Mr Brewer said. “Australia lends itself more to the asset-light than the asset-heavy model but it remains to be seen.’’

DHL eCommerce, which has half the air express market into and out of Australia, has also developed an eco-friendly vehicle StreetScooter and driverless helicopter Parcelcopter for last-mile delivery in its home market of Germany and is looking at bringing the technology to Asian markets.

“Most brands see delivery as being a key differentiator. Not many were previously focused on the supply chain experience. Now brands are asking us how to capture the customer in the delivery experience,’’ Mr Brewer said.

“The on-demand culture is forcing brands and retailers to rethink supply chain models.’’

US retail juggernaut Amazon has focused on last mile delivery in its home market, especially with its Amazon Prime same-day-delivery service, and will open its first Australian fulfilment centre in Dandenong next year.

Mr Brewer said DHL eCommerce was open to working with Amazon in Australia.

“They are a really important customer for us globally. We also work with Alibaba too.’’

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