As one of the fastest growing economies with a focused thrust on logistics and supply chain infrastructure development, India has been working towards reducing its logistics costs, while also bringing in innovative tech enabled solutions and greener practices that meet the International norms of sustainability. And one of the major areas for improvement is the cold supply chain infrastructure. With a fast-growing population, we are facing a scarcity of production, with decreasing farmlands and fewer farmers passing on the job to the next generation. Under such circumstances, we are all looking at a huge scarcity of perishables coming up soon, making it vital that the food currently being produced is distributed optimally and without wastage.
However, as a nation, we currently incur food losses worth about US$ 14 bn., due to inefficiencies in cold supply chain, especially last mile deliveries, which currently happens to be one of the most neglected segments of the supply chain. This negligence is caused due to series of factors, including operational lapses like using non-refrigerated vehicles for shorter distances, lack of smaller reefer vehicles, which in turn forces dealers and retailers to use non reefer vehicles and ineffective handling of products by untrained delivery agents. Additionally, since each vehicle carries materials for multiple stores and ends up sorting and unloading at multiple stops, the temperature consistency is lost each time the doors are kept open while inventory is being sorted out. As a result, by the time the vehicle delivers to the last store, the product quality is compromised, causing rejections and returns and thus revenue losses. Technical lapses include lack of real time tracking and tracing, lack of effective temperature monitoring during transit and a scattered and broken cold supply chain handled by multiple trained and untrained staff. While these lapses impact the overall product quality of perishables, shippers also incur heavy revenue losses, due to systemic gaps in the cold chain.
In order to avoid the wastage, loss of revenue and to preserve the shelf life and quality of perishables, tech adoption and integration needs to be a top priority for last mile deliveries. Listed here are some ways on how this can have a larger impact on the economy and the sector.
1. Real-time Tracking and Monitoring:
Through effective tech integration on a single platform, it is possible to monitor temperature, track and trace movement of cargo across the last mile delivery routes in real time. This also offers 360° visibility into last mile delivery fleets, including KPIs such as temperature monitoring, capacity utilization, driving speed and idling times, which ensures optimum allocation of consignments, maximizes capacity utilization of reefer vehicles and enhances cargo security.
2. Smarter Inventory Management:
Tech-enabled last mile delivery set up helps map cold storage facilities and gain data driven insights about the quality aspects of perishables, both on-site and in transit, thereby offering tangible proof of value. This, in turn, can help ensure fair price for optimum quality products delivered in good condition, thereby cutting losses. Additionally, accurate stock data at all stages of supply can ensure better inventory management, especially for short-shelf-life products and plan last mile deliveries in a more effective manner.
3. Cost Optimization:
Through effectively leveraging technology, logistics companies can catalyze significant cost-optimizing benefits through effective route mapping, scheduling deliveries and helping fleet managers to analyze and even toggle temperature settings on the go, to accommodate for local climate changes and unforeseen delays. Most importantly, these solutions minimize human error and enable managers to take action on potential issues before they turn into major catastrophes.
4. Reduced Errors and Higher Revenue:
By optimizing last-mile deliveries through tech driven solutions, logistic service providers can not only profit through the increased operational efficiencies, but also ensure higher revenues, owing to reduced wastage, consistent quality of products and enhanced reach, thereby improving profit margins. Further, with reduced errors and accidents, the liabilities and thus penalties etc. are also largely reduced, making the process both operationally and economically rewarding.
5. Enhanced Customer experience:
Lastly, the tech-enabled and optimized last-mile deliveries with its transparent flow of information, goes a long way in enhancing customer experience and thus helping build long term business relationships and more revenue. These also help build better collaborations within the business ecosystem, with vendors, peers and investors etc., all of whom can now see the value brought to the table.
To conclude, it would be wise to understand that in order to build a truly effective and unbroken cold supply chain network, it is important to also focus on building the last-mile delivery infrastructure, in addition to the focus on cold storage and transportation. And an integrated tech platform that not only provides operational and cost efficiencies, but also a seamless integration of various aspects of the cold chain, which otherwise have been left functioning in silos would be the significant accelerator in the growth of the sector. Going forward, tech integration coupled with favourable government policies could help transform the future of Food and Pharma cold chains, making them some of the most robust and effective logistics networks across the globe.
About the Author:
Swarup Bose
Founder & CEO,
Celcius Logistics Solutions Pvt. Ltd.
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