India’s last-mile delivery sector is undergoing a massive transformation, driven by cutting-edge technology, evolving consumer behaviour, and an urgent need for sustainability. From AI-driven logistics optimization to drone-based deliveries and the electrification of fleets, companies are racing to build faster, more efficient, and eco-friendly supply chains. However, with the rapid rise of quick-commerce and increasing competition, businesses must navigate complex operational challenges while ensuring long-term profitability. The future of last-mile logistics in India hinges on innovation, adaptability, and a fine balance between speed and sustainability. This Cover Story explores the transformation of last-mile delivery, highlighting how innovation, sustainability, and evolving consumer expectations are reshaping logistics, with expert insights on the trends driving this shift.
The global last-mile delivery market, valued at approximately $146.81 billion in 2023, is projected to reach $340.56 billion by 2032, growing at a CAGR of 9.8%. A key challenge remains cost, with last-mile logistics accounting for 41% of total supply chain expenses. Businesses are investing heavily in AI-driven optimization, micro-fulfillment centers, and autonomous delivery solutions like drones and electric vehicles (EVs). Meanwhile, the growing demand for zero-emission vehicles (ZEVs) highlights a broader push toward eco-friendly logistics.
India’s last-mile delivery market mirrors these global trends but with an even sharper growth trajectory. The sector was valued at $3.53 billion in 2023 and is expected to soar to $10.55 billion by 2032, growing at a CAGR of 12.2%. The broader e-commerce logistics sector is on a 24.44% CAGR trajectory, projected to reach $106.67 billion by 2032. One of the biggest disruptors in India is the quick-commerce segment, which has surged from $100 million in 2020 to a projected $6 billion in 2024. However, the financial sustainability of ultra-fast deliveries remains a pressing concern, with companies struggling to balance speed and cost efficiency. In response, Indian logistics firms are rapidly adopting AI, automation, and electric vehicle fleets to enhance efficiency and sustainability. Companies are also experimenting with drones and autonomous vehicles, aiming to revolutionize last-mile operations in urban and semi-urban areas. With these insights, let’s turn to the experts for their take on the evolving last-mile delivery landscape…
How do you perceive the last mile in e-commerce?
Kamlesh Kumar
Kamlesh Kumar, Vice President – Supply Chain, Jumbotail: In e-commerce, the last mile is a crucial focus for businesses for two main reasons. Firstly, it serves as a key differentiator in a highly competitive market, shaping consumer perception. Research from Capgemini indicates that 74% of consumers are willing to increase their spending by at least 12% with their preferred retailers if they receive efficient and exceptional last-mile delivery services. Secondly, the last mile constitutes a substantial 40% of total supply chain costs. In today's business environment, where profitability is paramount, optimizing last-mile logistics is essential for e-commerce success.
At Jumbotail, our mission is to revolutionize India's food and grocery sector through technology, data science, and design. We are actively investing in advanced technologies and strategic initiatives to enhance last-mile efficiency. We strongly believe that organizations must invest in data analytics to remain agile, competitive, and customer-centric in a rapidly evolving market. Data-driven decision-making allows businesses to identify inefficiencies within their logistics network, leading to targeted optimizations in routing and operations. Our team continuously innovates to refine milk-run supply chain routing, ensuring exceptional customer experience while building a sustainable logistics network.
Dipanjan Banerjee
Dipanjan Banerjee, Chief Commercial Officer, Blue Dart Express Ltd.: At Blue Dart, we are committed to delivering reliable, fast, and cost-effective solutions to our customers. Last-mile delivery plays a vital role in shaping the overall e-commerce experience, but it comes with its own set of challenges, including traffic congestion, unpredictable delivery windows, and the need for precise delivery accuracy. To address these challenges, we utilize advanced route optimization technology, which helps mitigate traffic issues and ensures timely deliveries. Additionally, we’ve built a strong network of delivery partners to offer flexibility and consistently meet customer expectations. We have also partnered with what3words which has helped us improve address accuracy, delivery efficiency, and customer experience across the country. We continuously assess and refine our last-mile delivery strategies to reduce delays, lower costs, and improve customer satisfaction. By combining innovative technology with strong partnerships, we are well-prepared to navigate the complexities of last-mile delivery in e-commerce.
Deepak Kumar Goel, Chief of Operations – Last Mile, Shadowfax Technologies: Today last mile is primarily driven by speed at which consumers want the product. Consumer preferences are changing very quickly. Today if I open an e-commerce platform, my first filter is usually if I can get the product within same day. With the evolution of quick commerce, this is further going to put stress on delivery speed. So, the biggest challenge to addressing consumer expectation is how to meet this speed without burning a lot of cost. We are the pioneers for this speed in the industry. We are the biggest players in Same Day delivery and quick commerce delivery and over the years have fine-tuned our tech to suit to meeting speed expectation from the consumer.
Pradeep Billava
Pradeep Billava, Vice President, Zepto: The last mile in e-commerce is critical, impacting customer satisfaction and operational efficiency significantly. It represents the final and most visible step in the delivery process where efficiency, reliability, and superior service quality are crucial.
Rider Availability and Retention: To tackle challenges during peak periods such as holidays and festivals, we utilize advanced rider partner apps that facilitate easy sign-ups and rigorous vetting processes. Competitive bonuses and a supportive work culture are essential for maintaining rider retention. These tools ensure continuous availability of gig workers, crucial for meeting delivery demands.
Professional Development and Engagement: Comprehensive training programs integrated through technology platforms enhance riders' customer service skills, safety protocols, and emergency responses. Such initiatives not only empower riders but also improve customer interactions, leading to higher satisfaction rates. Additionally, using technology to conduct and analyze employee NPS helps in understanding rider satisfaction and engagement levels, guiding improvements in workplace practices.
Operational Integrity and Security: Technology platforms enhance security by ensuring that riders are who they claim to be, thereby maintaining operational integrity and customer trust. Features like identity verification embedded in apps help prevent impersonation and fraud.
Regulatory Compliance and Continuous Education: Continuous education on regulatory compliance is facilitated through digital platforms that also provide robust support systems such as helplines and grievance centers. This ensures that riders are well-informed and supported, adhering to the highest standards of safety and legality.
Performance Incentives and Metrics: Performance metrics such as earnings per hour, job completion rates, and employee NPS are tracked and analyzed through sophisticated apps. Regular payouts and milestone bonuses encourage long-term engagement and high performance.
Enhancing Communication Through Technology: Technology not only facilitates real-time communication and feedback but also integrates gamification elements to foster a competitive yet collaborative environment. Competitions themed around key performance indicators, and offering lucrative prizes, are organized through these platforms, creating excitement and driving excellence.
Customers today have high expectations for service quality and product availability across channels. How do you balance priorities across these channels?
Kamlesh Kumar: Businesses primarily consider two factors when balancing priorities in an omnichannel supply chain: customer preferences, which form the backbone of our operations, and operational capabilities or limitations. These two elements shape how we manage priorities across different channels. A few key aspects help maintain this balance. First, consistency across channels is critical, as high customer expectations are now universal. Second, deciding which channel to prioritize depends on customer journey mapping.
We believe the most scalable way to address challenges in India's food and grocery ecosystem is to start by solving demand-side issues at scale. With 96% of India's $450 billion food and grocery market flowing through over 10 million Kirana stores—neighborhood mom-and-pop retailers—these stores are the backbone of our economy. Contrary to popular belief, Kirana stores are not dying due to e-commerce and competitive pricing; instead, they struggle to showcase their value proposition to end consumers. Recognizing this gap, we saw a tremendous opportunity to serve Kirana stores by building a wholesale marketplace that connects them with staple producers, traders, and FMCG brands.
While we are a technology- and AI-driven company, our true competitive edge lies in operational excellence and strong business fundamentals, enabled by cutting-edge technology. We manage thousands of tons and millions of physical units of food and grocery products through our tech-driven, in-house supply chain, built specifically for wholesale food and grocery e-commerce in India. We immerse ourselves in understanding our users, combining qualitative insights with data-driven analytics to enhance customer experience and maximize value. Our goal is to fundamentally transform India's food and grocery ecosystem. In doing so, we aim to build a large, impactful, and profitable business that makes our country proud.
Deepak Kumar Goel
Deepak Kumar Goel: The secret lies in segmenting your customers better and creating a differentiating service line across segments. A customer sitting in Bihar and ordering a Rs 300 product Vs a customer in one of the metros ordering a Rs 5000 product – the expectation is not similar. And hence your cost of service cannot be similar. So, you have to segment and design the service line separately for each expectation accordingly.
How do you balance speed, cost, and customer satisfaction in last-mile deliveries?
Kamlesh Kumar: It’s no longer a trade-off between cost and speed; instead, it’s about optimizing both. Customers expect speed and convenience, while businesses need to manage costs to maintain profitability. In the B2B space, where margins are thin, achieving this balance requires strategic investments. One key area is advanced routing technology, particularly AI-driven solutions, which help us optimize delivery routes for faster and more efficient service. Another crucial focus is enhancing customer communication. Today’s customers expect real-time updates on their orders, and if a delivery is delayed, they want to be informed immediately.
The expectations of Kirana store owners have also evolved. Previously, they were comfortable waiting a week for supplier deliveries. Now, they demand just-in-time fulfillment. As a result, educating customers on supply chain dynamics and leveraging technology to meet their needs have become essential for companies like ours.
Dipanjan Banerjee: Balancing speed, cost, and customer satisfaction in last-mile deliveries is a complex yet critical task, and at Blue Dart, we achieve this balance through a combination of strategic planning, technology, and operational efficiency. To ensure speed, we optimize routes using AI-driven predictive analytics and real-time tracking systems, allowing us to predict delivery windows, minimize delays, and adjust routes dynamically based on factors like traffic and weather. On the cost front, we maintain a scalable fleet that adjusts to demand, helping us control expenses during off-peak periods.
Above all, customer satisfaction is our priority. We understand that timely and reliable deliveries are essential to the customer experience. By focusing on consistent quality, clear communication, and flexible delivery options, we ensure each delivery meets high standards. This balanced approach allows us to provide fast, cost-effective, and reliable last-mile solutions while always prioritizing customer satisfaction.
Deepak Kumar Goel: Well, the choice is simple – Customer Service Supersedes Everything. We cannot think of delivering business without delivering smiles on the customer faces. Once our customers are satisfied, all the other things fall into place automatically. Having said that, cost is the basic principle that goes into designing any supply chain. Which transportation mode to use, which logistics model to use, where all to stock inventory etc., all are designed by keeping cost into consideration. However, when the choice is Vs Customer service, the latter is prioritized.
Pradeep Billava: The last-mile delivery challenges in the e-commerce sector are complex, involving a delicate balance of speed, cost, and customer satisfaction. This balance is pivotal as it directly impacts on customer loyalty and business sustainability. Here's how the industry addresses these challenges:
Diversifying Delivery Modes: Flexibility in delivery options is crucial. Businesses are adopting a variety of methods, from traditional motorbikes to walkers for short distances and cycles, e-cycles, and e-bikes, tailored to different urban layouts and distance requirements. This strategic diversity optimizes both cost and delivery speed, meeting varied customer expectations.
Leveraging Data Analytics: Data analytics play a critical role in mining customer feedback and retention data to understand how delivery speed and cost variations impact customer satisfaction. This data-driven insight allows businesses to finely tune their delivery operations to align with customer expectations, thereby managing costs effectively while enhancing satisfaction.
Enhancing Customer Communication: Advancements in technology enable real-time updates about delivery status, providing customers with the flexibility to manage their orders, such as rescheduling deliveries or updating delivery details. This level of proactive communication maintains transparency and builds trust, particularly crucial during delays.
Cost vs. Customer Loyalty: Strategically evaluating the trade-offs between the costs of delivery and the benefits of customer acquisition and retention is crucial. The industry often balances faster, more flexible delivery options against the costs, determining investment levels based on potential gains in customer loyalty.
Continuous Supply Chain Innovation: E-commerce companies continuously innovate their supply chain processes to reduce overheads and improve service delivery, integrating cutting-edge technology and redesigning logistics frameworks to maintain a competitive edge.
Innovative Testing Approaches: Beyond conventional methods, the industry employs structured experiments like multivariate and sequential offering tests to gauge customer preferences for different delivery options at varying price points. This helps companies adapt their delivery services based on empirical customer behavior and market conditions.
Experiment Design: Careful planning and implementation of experiments are undertaken to explore customer preferences across demographic and regional variations. This approach helps predict and meet customer needs more accurately, guiding logistical adjustments and service offerings.
Creating the right logistics network is a challenging task. How do your customers evaluate and determine the best combination of distribution centers, nodes, and partnerships to efficiently support omnichannel demand?
Deepak Kumar Goel: The key focus is always on the customer. Understanding their expectations is crucial. As a 3PL full-stack solution provider, we operate across all Indian markets, from Tier I to Tier III cities. Our customers have diverse delivery needs—some expect products within 10 or 30 minutes, others prefer same-day or next-day delivery, while some prioritize cost over speed and are willing to wait four to five days for the best value. Expanding e-commerce into tier III markets requires tailoring the supply chain to their unique demands. In rural areas, cost often takes the precedence. The supply chain can be designed as a mesh network, where multiple nodes interconnect for faster reach, or as a hub-and-spoke model optimized for cost efficiency.
For example, when delivering to remote areas of Bihar or Jharkhand, the hub-and-spoke model is more practical. A central facility in Patna would distribute goods to smaller, localized transport networks. However, in metropolitan areas where 30-minute or same-day deliveries are common, dark stores play a crucial role in ensuring timely fulfillment.
That said, a single warehouse in Hoskote, Bengaluru, cannot serve customers across the city within 30 minutes. Inventory placement must be customized—what sells in Koramangala might differ from what’s needed in Sarjapur Road or Hoskote. Customer profiling is essential to optimize supply chain segmentation. E-commerce is evolving to the extent that even within a single warehouse or sort center, different layouts may cater to distinct needs.
When balancing speed and cost efficiency, many focus primarily on warehousing and network design. However, transportation plays the biggest role in speed. While road transport from Delhi to Bengaluru takes around 50 hours and air transport is costly but takes just 2 hours, the Indian railway system remains an underutilized alternative. Rajdhani Express, for instance, completes the same journey in about 36 hours and has proven to be both cost-effective and efficient for goods transport.
How do you manage peak demand periods (e.g., festive seasons, flash sales)?
Dipanjan Banerjee: We have developed a comprehensive strategy to manage peak demand periods, ensuring that we maintain high service levels. One of the key elements of our approach is the scalability of our operations. We prepare in advance by deploying additional resources and leveraging advanced route optimization software to ensure timely and efficient deliveries, even during high-volume periods. Another significant advantage is our ownership of a dedicated fleet of cargo planes, which sets us apart from many competitors who rely mostly on commercial flights and surface transport. This capability allows us to have greater control over our air freight capacity, particularly during peak seasons when demand for air cargo increases. By not being entirely dependent on commercial airlines, we can better manage flight schedules, reduce delays, and maintain consistent delivery timelines. Additionally, our advanced surface transport network helps us further streamline operations, ensuring that deliveries are not only timely but also cost-effective.
How do you manage returns effectively while minimizing costs? Are there specific strategies or technologies that help streamline this process?
Kamlesh Kumar: Since we deal with a large volume of staples—many of which are seasonal and sourced from different suppliers—variations in quality are inevitable. As a result, most of our returns stem from quality differences. However, returns don’t significantly impact our costs, thanks to our efficient logistics model. Our business operates within a defined customer base in each city, with frequent and recurring deliveries. This allows us to integrate reverse logistics seamlessly into our forward delivery plans. Whenever we schedule a delivery, we simultaneously manage returns, ensuring minimal additional costs. Given the thin margins in our industry, dedicating separate resources to handle returns would be unsustainable. By optimizing our logistics and leveraging our existing routes, we ensure returns are managed efficiently without eroding profitability.
Deepak Kumar Goel: That’s a great question, considering that reverse logistics is an integral part of the e-commerce industry. Currently, the industry sees return rates of around 10-15%. Effectively managing returns requires a deep understanding of the key challenges involved. One of the biggest challenges in reverse logistics, particularly in India, is fraud. A small segment of customers engages in fraudulent activities such as using products and returning them, swapping items before returning, or sending back damaged goods. Beyond the revenue loss, companies also bear the additional cost of not receiving the original product in return.
To address this, Shadowfax was among the first to introduce a quality check system at the point of pickup. When a delivery agent collects a return, we ensure a verification process is in place to confirm that the returned item matches what was originally delivered. Additionally, our technology and operational processes are designed to prevent fraud, even at the level of delivery personnel. This has been one of the most significant improvements in managing reverse logistics.
Beyond fraud prevention, reverse logistics is inherently cost-intensive. Optimizing resources is key to minimizing expenses—this means efficiently cross-utilizing delivery personnel, sort centers, and transportation networks for both forward and reverse logistics. Another critical aspect is reducing lost revenue. Many platforms are now offering exchange options instead of outright returns. Implementing seamless technology and processes to support such services can help businesses retain revenue while still providing flexibility to customers. At Shadowfax, we have successfully tackled several of these challenges, which has positioned us as a market leader in reverse logistics. However, this sector continues to evolve, and there are still many areas where further innovation is needed.
Pradeep Billava: Managing returns effectively while minimizing costs is crucial in e-commerce. A well-coordinated approach that combines clear policies, technological integration, and strategic incentives can significantly enhance customer satisfaction and reduce financial impact. Here’s how this is typically addressed across the industry:
Clear Return Policies: Well-defined return policies clearly communicated through strategic design elements help categorize products into returnable and non-returnable groups effectively. This clarity reduces confusion and manages customer expectations, setting the groundwork for a smooth return process.
Incentives: Offering instant discounts for customers who commit to no-return purchases and providing cashback rewards post-delivery can significantly reduce return rates. These incentives encourage customers to make thoughtful purchases and reward them for retention.
Disincentives: Implementing return charges and requiring customers to handle shipping for returns can discourage unnecessary returns, aligning behaviors with genuine needs.
Leveraging Technology: Data Analytics and AI tools collect and analyze data on customer demographics and buying behaviors to provide accurate product recommendations and size suggestions, decreasing the likelihood of returns. Augmented reality and live demonstrations allow customers to visualize products more realistically, which helps in reducing mismatched expectations. AI and Chatbots provide immediate assistance to answer pre-purchase questions, clarifying product details and functionalities that might otherwise lead to returns.
Proactive Product Management: Monitoring return rates and customer feedback allows for timely corrective actions, such as delisting products that consistently fail to meet customer expectations. This proactive approach enhances customer experience and minimizes costs associated with frequently returned products.
Streamlined Return Processes: Efficient management of the logistics of returns is vital. This includes optimizing reverse logistics to keep costs low and re-integrating returned goods into inventory as quickly as possible. Automation in the return handling process, from initiating return requests to processing refunds or replacements, facilitates this efficiency.
To support the growing demands of e-commerce and quick-commerce, companies are optimizing their warehousing strategies. Micro-fulfillment centers, small-scale warehouses strategically located in urban areas, allow for faster order processing and delivery. These facilities help logistics firms reduce transportation costs and meet rising consumer expectations for same-day or even instant deliveries.
The rise of dark stores—retail spaces converted into fulfillment hubs exclusively for online orders—is another trend shaping last-mile logistics. Dark stores improve supply chain efficiency by ensuring that high-demand products are always available close to consumer hubs. AI-powered predictive stocking further enhances inventory management, ensuring that delivery networks operate seamlessly.
What key innovations or operational improvements have you implemented in the last mile to enhance both speed and reliability?
Kamlesh Kumar: Both of these factors are critically important in today's consumer e-commerce industry. When effectively managed, they help businesses earn consumer trust, leading to improvements in topline revenue. To ensure operational reliability, we have developed intelligent planning systems capable of predicting the impact of various factors such as traffic, weather conditions, festivals, and geopolitical events. This enables us to proactively mitigate potential risks. While consumers may not be concerned with these complexities, their primary expectation is seamless order fulfilment.
Another crucial aspect of ensuring operational reliability is resource availability. We have implemented a predictive model for workforce attrition, while our people experience team actively engages with employees to address their concerns. This approach allows us to retain highly skilled, tenured employees, enhancing operational stability and productivity. Additionally, we have adopted a flexible workforce model to minimize operational disruptions. Real-time visibility and proactive customer communication regarding potential disruptions further strengthen consumer trust and loyalty.
Speed is another key factor, and our smart network design plays a crucial role in optimizing delivery times. By identifying high-demand clusters and strategically placing fulfilment facilities closer to customers, we enhance efficiency. Our micro-fulfilment centres are strategically positioned to ensure faster deliveries. Another essential aspect is leveraging data-driven, optimized route planning, which enables us to reach customers in less time. Currently, several other initiatives are underway to further enhance delivery speed, as we recognize that evolving consumer preferences make speed a key competitive advantage in the e-commerce industry.
Dipanjan Banerjee: We continuously strive to improve our last-mile delivery to ensure both speed and reliability. One of the key innovations we’ve implemented is the automation of last-mile route optimization. By using advanced algorithms and AI-driven predictive analytics, we can dynamically adjust delivery routes in real time, enabling us to better predict delivery times and optimize efficiency. This not only ensures faster delivery but also improves reliability by minimizing potential delays.
Additionally, to address the challenges posed by dense urban environments, we have introduced micro-hubs strategically located closer to customer delivery points. These hubs help reduce delivery distances, allowing us to achieve faster turnaround times and improve the overall customer experience. Additionally, our collaboration with what3words has enhanced address accuracy, delivery efficiency, and the overall customer experience nationwide. Furthermore, in response to the growing demand for faster, eco-friendly solutions, we are expanding the use of drone deliveries. Drones offer a promising solution for swift, last-mile delivery, especially in hard-to-reach areas. This aligns with our goal to meet evolving customer preferences while maintaining our commitment to speed and sustainability.
Deepak Kumar Goel: Among industry players, we are relatively young, but last-mile success depends entirely on technology. Speed and accuracy hinge on precise address identification. In India, particularly in rural areas, many addresses and pin codes are fragmented. To improve accuracy, we’ve invested in building our own address indices, as Google Maps often lacks precise location data for these regions. This has enabled us to deliver faster and more accurately. For quick-commerce deliveries, robust tech infrastructure is essential. From the first-mile pickup to the final-mile delivery, every step must be precisely timed to ensure seamless execution.
SUSTAINABILITY CHALLENGES AND THE PUSH FOR GREEN LOGISTICS
Environmental concerns are pushing logistics companies to adopt greener delivery solutions. The most notable shift is the growing adoption of electric vehicles (EVs) for last-mile logistics. Companies like Mahindra Logistics, Flipkart, and Amazon are deploying EV fleets to cut carbon emissions and align with global sustainability goals. However, the transition is complex due to the high upfront costs of EVs, limited charging infrastructure, and concerns about vehicle range. To address these challenges, businesses are exploring alternative sustainability strategies. Shared logistics models, where multiple companies use common delivery resources, help optimize routes and reduce emissions. Fuel delivery startups like FuelBuddy are also playing a role in minimizing inefficiencies by offering doorstep fuel solutions, reducing the dependency on traditional refueling infrastructure.
What’s your take on sustainability in the last mile? What are the measures or innovative initiatives taken by you when it comes to sustainable expanse?
Kamlesh Kumar: Sustainability encompasses three key dimensions: environmental, social, and economic sustainability. At Jumbotail, we are committed to integrating these principles into our business operations and decision-making processes. For environmental sustainability, we have implemented initiatives such as deploying an electric vehicle fleet, utilizing AI/ML-based optimized routing to minimize fuel consumption, and establishing a smart, consolidated logistics network to reduce travel distances. Additionally, we employ milk-run deliveries to lower CO? emissions per order delivered.
In terms of social sustainability, we prioritize meaningful engagement with local communities, ensuring that our operations do not cause any discomfort or disruption. We actively promote community participation by offering various partnership opportunities. Our technology systems are designed to ensure compliance with local regulations while providing enhanced transparency for our people regarding their payouts, attendance, provident fund (PF), insurance, and other benefits. Furthermore, we have established centralized grievance mechanisms to address concerns raised by our employees and the community. Our team is also actively implementing initiatives to enhance workplace safety. Economic sustainability is fundamental to the long-term success of any business. We continuously strive to achieve profitability across all aspects of our operations while maintaining our commitment to sustainable growth.
Dipanjan Banerjee: Sustainability is at the core of our operations, especially when it comes to last-mile delivery. We recognize the importance of minimizing our environmental impact, and we have taken several steps to ensure that our expansion aligns with sustainable practices. A key initiative is the integration of eco-friendly vehicles into our fleet. We have incorporated electric vehicles for short-distance deliveries, significantly reducing emissions and contributing to cleaner urban environments. In addition to our fleet upgrades, we are actively exploring methods to minimize packaging waste. This initiative will help in reducing the usage of excess packaging materials and promoting recyclable or biodegradable alternatives, which will help decrease the overall environmental footprint of our deliveries. Furthermore, we are constantly exploring innovative delivery methods that are both efficient and environmentally friendly. For instance, we recently partnered with Delhi Metro Rail Corporation to facilitate large-scale cargo movement in the national capital with an aim to reduce the company's carbon footprint while contributing to Delhi’s clean air challenge.
Deepak Kumar Goel: Sustainability for me is to build things which can sustain for over 100 years. Now this is possible only if you suit yourself to your surroundings and environment. We are making huge inroads into leasing EVs for our last mile delivery so that we can sustain over 100 years while building a cleaner environment!
Pradeep Billava: Sustainability in last-mile delivery is not just about adopting one or two green practices but about integrating a holistic approach that considers environmental impacts across all stages of the delivery process. This strategic integration of sustainability can ultimately lead to more resilient and adaptable business operations in the face of evolving environmental challenges. Sustainability in the last-mile context involves minimizing environmental impacts associated with delivery processes. This includes reducing greenhouse gas emissions, optimizing resource use, and managing waste effectively. As consumer awareness and regulatory pressures increase, companies are compelled to integrate sustainable practices into their last-mile operations.
Electric and Alternative Fuel Vehicles: One of the most significant shifts has been the adoption of electric vehicles (EVs) and other vehicles powered by alternative fuels like hydrogen or biodiesel. These vehicles produce fewer emissions than traditional petrol or diesel delivery vans, contributing to a significant reduction in the carbon footprint of last-mile operations.
Route Optimization Software: Utilizing advanced route optimization algorithms helps reduce unnecessary mileage and fuel consumption. These software solutions calculate the most efficient delivery routes, taking into account factors like traffic, delivery windows, and vehicle capacity, thereby minimizing the number of vehicles on the road and the distance travelled.
Packaging Innovations: Moving towards sustainable packaging by using materials that are recyclable, biodegradable, or made from recycled content is another critical initiative. Reducing packaging size and weight also decreases the overall energy used in transportation, further enhancing sustainability.
Delivery Consolidation: Consolidating deliveries to decrease the number of trips made can dramatically reduce emissions. This can be achieved through improved logistics planning, such as setting up urban fulfilment centres that allow for bulk transport to a central hub, from which individual deliveries are made using eco-friendly modes like bicycles or electric scooters.
Collaborative Delivery Networks: Participating in or forming collaborative delivery networks can also help. These networks allow multiple retailers to share logistics and delivery resources, reducing the total number of vehicles required for deliveries and maximizing the utilization of each delivery trip.
Incentives for Green Choices: Offering customers incentives for choosing greener delivery options, such as longer delivery windows which allow for route optimization or grouping of orders, can also promote sustainability. This not only helps in reducing carbon emissions but also aligns with the growing consumer preference for environmentally friendly practices.
Use of Renewable Energy in Logistics Centres: Powering fulfilments and sorting centres with renewable energy sources like solar or wind reduces the carbon footprint associated with the storage and handling of goods before the final delivery stage.
AI AND AUTOMATION: THE CORE OF LOGISTICS EFFICIENCY
AI is revolutionizing last-mile logistics by enhancing route optimization, predictive demand forecasting, and automated dispatching. Advanced machine learning algorithms analyze real-time data, including traffic patterns, weather conditions, and consumer preferences, allowing logistics companies to dynamically adjust routes and minimize delays. This has a direct impact on cost efficiency, fuel consumption, and customer satisfaction. Companies like Amazon and Flipkart are heavily investing in AI-driven logistics, using real-time tracking, smart warehouse management, and automated sorting systems to streamline deliveries. AI-powered chatbots and digital assistants are also improving customer interactions by offering accurate delivery updates and support. For businesses, AI-driven optimization reduces delivery failures, which is a major cost burden in last-mile logistics.
THE ROLE OF DRONES AND AUTONOMOUS VEHICLES IN DELIVERY
While still in the pilot stage, drones and autonomous delivery bots are emerging as potential game-changers in last-mile logistics. Drones offer an efficient way to deliver parcels to remote or high-traffic areas, reducing dependence on traditional road-based delivery networks. Companies like Zipline and Wing have successfully implemented drone deliveries in select global markets, demonstrating their viability for faster, cost-effective service. In India, companies are also experimenting with autonomous ground-based delivery robots for urban logistics. These AI- driven bots can navigate city streets and deliver packages within a limited radius. However, widespread adoption is constrained by regulatory hurdles, infrastructure gaps, and concerns over security and operational scalability. As regulatory frameworks evolve, drones and autonomous vehicles may become mainstream solutions for tackling last-mile inefficiencies.
What role does data analytics play in optimizing your deliveries?
Kamlesh Kumar: Data analytics is a key pillar of our supply chain. One of its primary use cases is predicting delivery times for each customer and proactively communicating this information. To accurately forecast delivery time, we must precisely estimate both travel time and doorstep interaction time. To predict doorstep arrival time, we take into account various factors, including the number and weight of items to be delivered, payment type, past customer behavior, and any returns. Based on these factors, we determine the estimated doorstep time, which serves as a critical input for route planning.
Additionally, last-mile delivery is highly dynamic, influenced by multiple uncontrollable factors that can impact deliveries. In such cases, we leverage analytics to anticipate delays and proactively inform customers as well as internal stakeholders and decision-makers. This enables swift action to recover affected deliveries. Beyond delivery time prediction, data analytics has numerous other applications, as it plays a crucial role in real-time decision-making within a tech-driven supply chain.
Pradeep Billava: Data analytics plays a crucial role in optimizing delivery operations, enhancing efficiency, customer satisfaction, and overall decision-making. Here’s how data analytics is leveraged specifically in this dynamic and fast-growing market:
Demand Forecasting: Data analytics is instrumental in predicting demand patterns across various regions and times. By analyzing historical sales data, weather conditions, and regional purchasing trends, e-commerce companies in India can anticipate demand spikes and prepare accordingly. This foresight helps in stocking warehouses appropriately, positioning inventory closer to high-demand areas, and planning for sufficient delivery resources during peak times, like festivals and sales events.
Route Optimization: In a country with diverse geographic and infrastructural challenges like India, route optimization becomes particularly critical. Data analytics enables companies to analyze traffic patterns, delivery addresses, and the most efficient paths. Tools that incorporate real-time data can adjust routes on the fly, helping delivery personnel avoid congested areas, leading to faster delivery times and reduced fuel consumption.
Customer Behavior Insights: Analyzing customer buying behaviors, preferences, and feedback allows companies to enhance their customer experience. For instance, understanding peak ordering times, preferred delivery slots, and product preferences in different regions help tailor the delivery process. This customization increases customer satisfaction and repeat business, essential in the competitive Indian e-commerce landscape.
Dynamic Pricing and Delivery Models: Data analytics supports dynamic pricing models where delivery charges are adjusted based on various factors like order size, delivery speed, and customer loyalty. Insights derived from data help e-commerce platforms in India implement pricing strategies that maximize profitability while remaining attractive to customers.
Inventory Management: Effective inventory management is crucial to prevent stockouts or overstock situations. Data analytics provides detailed insights into which products are moving fast, and which aren't, enabling more accurate inventory control. This is particularly important in India where storage costs are high and product ranges are vast due to diverse consumer preferences.
Fraud Detection and Prevention: With the increasing volume of online transactions in India, fraud detection has become more critical. Data analytics helps identify unusual patterns that could indicate fraud, such as atypical high-value orders from new accounts or repeated orders to the same address under different names. Early detection helps minimize risk and protect both the company and its customers.
Sustainability Efforts: As sustainability becomes a growing concern among Indian consumers, data analytics assists companies in implementing more sustainable practices. For example, by analyzing delivery data, companies can identify opportunities to consolidate deliveries and reduce carbon emissions, aligning operational practices with environmental sustainability goals.
BEYOND THE LAST MILE: THE FUTURE OF SMART & SUSTAINABLE DELIVERY
India’s last-mile delivery sector is at a critical juncture, balancing rapid technological advancements with sustainability and economic pressures. AI and automation are driving efficiency gains, while drones and autonomous vehicles hold long-term promise. The shift toward electric mobility is inevitable, but challenges around cost and infrastructure need to be addressed. Meanwhile, the explosive growth of quick commerce is testing the financial viability of ultra-fast delivery models.
Companies that succeed in this evolving landscape will be those that balance speed, efficiency, and profitability. Strategic partnerships, AI-driven innovations, and sustainable solutions will define the future of last-mile logistics in India. As consumer expectations evolve, logistics companies must remain agile, leveraging technology and data to stay competitive. The race for last-mile supremacy is on, and only the most innovative players will thrive in the years ahead!
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