Cushman & Wakefield today released its Last-Mile Logistics In China — A Package Of Improvements Set For Delivery report. The report takes a look at the current and future parcel delivery market in China before examining some of the further improvements that could be on the horizon and could be made in terms of last-mile delivery distribution facilities, package tracking, package delivery and package collection points.
Globally and in China, growth in last-mile delivery logistics has been robust over recent years with the growth in ecommerce being a significant driver of last-mile delivery logistics growth.
In 2022, China’s ecommerce transaction volume reached RMB 43.83 trillion, growth of 3.5% on a year-on-year (y-o-y) basis after 19.6% growth the previous year.
As ecommerce has grown in China, so has the parcel delivery business in the country. In 2022, when considering the business scale within China’s parcel delivery industry, it can be seen that a record high was reached. The parcel delivery business volume was 110.58 billion packages, up by 2.1% y-o-y off the back of an annual growth rate for the previous year of 29.9%.
Given the growth in ecommerce and subsequently the parcel delivery business in China, so last-mile delivery logistics in China needs to continually find ways to further improve to continually keep up with the times and to continually provide an even better customer service experience. There are many ways to improve, but four key areas to look at are last-mile:
Distribution Facility Improvements
Today, last-mile delivery distribution facilities need to operate efficiently and with as few glitches as possible. To improve, the next step for those last-mile delivery distribution facilities in China, which have not already done so, would be to automate.
Last-mile delivery distribution facility automation largely involves two elements:
- Automation to assist last-mile delivery distribution facility workers — utilizing robots/machines
- Automation to execute repetitive work — utilizing dedicated software
Package tracking in China is continuing to improve. For those delivery enterprises which are using the latest technology, a number of recognizable improvements have recently been made, including:
- AI-based package tracking is ensuring on-time delivery execution
- Real-time visibility is the norm
- Delivery drivers are being empowered
- Customers are getting a better delivery experience
- Delivery efficiently is being heightened and delivery costs are being reduced
Today, lorries, vans and scooters are mostly utilized for last-mile deliveries around the world, including in China. With the attention moving towards sustainability and utilization of green transportation, but also an emphasis on cost and delivery speed and efficiency, the logistics industry around the world and in China is presently looking at various delivery mode options, including:
- Autonomous delivery vehicles
- Fixed-wing unmanned aerial vehicles (UAVs)
Collection Point Improvements
Last-mile delivery can be very taxing for enterprises delivering to customers at a designated home or business address when the receiving customer is not present to receive the package at the collection point. This can result in multiple attempts to delivery by the delivery enterprise before a successful delivery is executed, which usually results in an unexpected increase fuel and labor costs incurred by the delivering enterprise. Two ways to ensure delivery is executed each and every time, are:
- A smart pick up and drop off (PUDO) system
- A smart self-service delivery locker bank system
Tony Su, Managing Director, National Head of Industrial & Logistics Property Services, China, Cushman & Wakefield, said: “Last-mile delivery importance elevation and growth in China are certainly big positives for the industry in the region in general, but there is still no getting away from the costs. Following on from this, smart last-mile logistics in the Chinese market has led to an improvement in the efficiency and execution of last-mile delivery in the country. In fact, the general strength, the overall development level and, in particular, the application of digital technology in China has also led to a benchmarking effect on a global scale.”
Shaun Brodie, Head of Business Development Services, East China and Greater China Research Content, Cushman & Wakefield, added: “Ahead, the last-mile delivery logistics market in China needs to continue to consider its market characteristics, the local consumer mindset and other factors to continue to effectively apply technology to business scenarios to keep costs down while at the same time helping local markets provide the best last-mile logistics and delivery solutions to the customer.”
About Cushman & Wakefield
Cushman & Wakefield (NYSE: CWK) is a leading global commercial real estate services firm for property owners and occupiers with approximately 52,000 employees in approximately 400 offices and 60 countries. In Greater China, a network of 23 offices serves local markets across the region. In 2022, the firm reported global revenue of US$10.1 billion across its core services of valuation, consulting, project & development services, capital markets, project & occupier services, industrial & logistics, retail, and others. It also receives numerous industry and business accolades for its award-winning culture and commitment to Diversity, Equity and Inclusion (DEI), Environmental, Social and Governance (ESG) and more. For additional information, visit www.cushmanwakefield.com
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