DC Velocity - July 2017

ize the driver fleet since most straight trucks do not require
a [commercial driver’s license] to operate.”
Stoffel of Werner expects that truckload carriers will
partner up with LTL carriers because it would not be
cost-effective to utilize a whole truck to transport, say, two
or three treadmills to residences, whereas an LTL carrier
commingling freight for multiple customers can afford to
do that. “Truckload service providers will need strong LTL
partnerships” to remain viable over the long haul, he said.

The growth of last-mile services, and the accompanying proliferation of entrants, could result in provider convergence the likes of which the transportation and logistics industry has rarely seen. “They’re all merging,” said Paul Johnson, vice president of global solutions and consulting for Descartes Systems Group Inc., a Waterloo, Ontario-based IT company, referring to the expected integration of services. The ability of providers to be flexible and recon-figure networks almost on the fly will be critical to success, Johnson said.

SUPERIOR TECHNOLOGY

To be sufficiently agile to support multiple workflows, providers will also need top-notch technology. A company like XPO, for example, offers visibility to the consumer from the point of purchase to proof of delivery, according to O’Shea. It also gives its contract drivers (it relies on about 5,000 independent contractors) visibility of the product down to the item level, O’Shea said. This means, among other things, that drivers can be guided to address specific issues related to product installation either while at the home or before arrival.

By contrast, truckload carriers have barely scratched the surface on track-and-trace technology because that hasn’t been a priority. Johnson of Descartes said the speed and proficiency by which truckload and LTL drivers master mobile technology will be another key factor in making last-mile work.

Above all else, according to O’Shea, those getting into the market must adapt to a new world. Not only are drivers entering a customer’s most private environment, but they are usually delivering a high-cost product that, in many cases, must also be assembled. Unlike “traditional” e-commerce shipments, which can be returned with relatively little inconvenience to the customer and cost to the retailer, a late delivery of a large-format item, damage to the item during delivery, improper installation, or just plain buyer’s remorse ratchets up the cost to the retailer as well as the provider. If any of those scenarios occurs, the driver must then go into “save the sale” mode, according to Stoffel of Werner.