How Data is Enabling New EV Last-Mile Delivery Business Models

Today, we see examples of technology piloting and testing in the field of EV last-mile delivery across the globe. In recent years, we have seen the scaling of technology deployment by several companies. From the stage of development to testing to rollout, last-mile technology is making rapid gains. Many modern data technologies streamline logistics operations, reduce costs, and improve the customer experience during the final leg of the delivery process. Companies in the parcel-delivery industry are projected to adopt the next trend, which is small and semi-autonomous delivery vehicles that accompany parcel-delivery workers. Route optimization is also one of the major results of data and technology. It helps to detect the fastest route for drivers to get any number of packages from a transportation hub to each of their final destinations. Real-time location tracking and integrated communication capabilities are helping to close the gap between drivers and consumers, improving the customer experience.

Data and tech disruption in last-mile delivery will also make it possible for deliveries through drones soon. It will also make it possible for all the new business models for deliveries involving robots as well. Through data technology, automatic updates on status keep customers in the loop via SMS alerts and real-time driver tracking, so they can make sure someone is around to receive the deliveries on time, reducing instances of damage of the goods when packages are left on the doorstep for hours unattended. Data and automation will support delivery staff and increase productivity by cutting the time needed to drive and park vans. Due to data sharing and modern technology, it is expected that robots will take packages right to customers’ front doors.

The major reason for the adoption of these data and technology is because customers are demanding more from their delivery providers, and a highly competitive environment combined with customers’ high-cost sensitivity has pushed the rapid and sudden development of technology that will help the industry deliver on these demands for the adoption of these new technologies by last-mile players. In the last-mile delivery, automation and data technologies will have an impact on the broader ecosystem, including competitive dynamics and value allocation across industry actors. The increased volume of deliveries and packages that must manage the challenges of the last mile might put pressure on last-mile operators to move more goods through the network. Growth in the number of online sales EV last-mile delivery vehicles would generate an uptick in returns, meaning that the last-mile networks of tomorrow will need to be optimized for delivery and pick-up, while handling a greater volume of goods.

Barcode scanners have been in use for years. EV last-mile delivery companies have been using AI and data connectivity. But today, all these forces such as sensors, computing power, and the ability to connect are coming together with unprecedented power. Due to which the ability to extract value from data is a large and possibly growing opportunity and could be a source of competitive advantage for carriers. In 2016, the global commercial vehicle telematics industry was estimated to be worth $2.4 billion. While hardware presently accounts for 95% of this, analysts predict that percentage to drop considerably as hardware costs decrease and software sales rise. The market is expected to reach $10.9 billion by 2026, with software accounting for almost $8.7 billion.

The Internet of Things (IoT) provides data which describe objects distributed worldwide. The data can be monitored in real time and at low cost in a central location, enabling completely new use cases and business models. It can collect and transmit data via sensors. Sensors of IoT can provide the information of real-time conditions, and connectivity allows “things” to instantly communicate conditions via the Internet. These objects essentially become smart. It can help in the transmission of signals and data that can provide a closer picture of the true state of business. Managers can make decisions and take action based on that data which will soon be everywhere, in mass quantities.

The data streaming in from trading partners, vehicles, factories, DCs, stores, weather bureaus needs to be standardized, sorted, and visible. This requires a central hub or platform. ERP software operates internally in the central nervous system as the connective tissue. It can provide unprecedented visibility into every process and transaction along the way of last mile delivery. Delays in the delivery of goods, extreme weather, delays, or late delivery of goods are accounted for to assess priorities and options, and offer the optimal decision automatically. It resides in the cloud, providing a networked ecosystem that serves as the foundation of the IoT supply chain.

It helps to read battery percentage, estimated mileage, remote immobilization, geo fencing, sharing battery use data with OEMs and creating vehicle life data to be shared with OEMs. It can estimate time per delivery, carbon saved data for all deliveries, API integration, Live AI enabled chat support, ML enabled invoice & logo reading, optimization of rider route and RRT assistance for breakdown. For the last mile delivery, AI can monitor timely assistance on battery charge, rider credit score, driver’s behaviour and maintenance support.

With the larger dependencies on technology and data, carriers could find it more and more necessary to maintain the ability to collect and make sense of it. Earlier digitization measured route efficiency and increased preventative maintenance effectiveness. This technology can be used for driver and safety features, allowing trucking businesses to track, coach, and improve driving behaviour while also expanding their business models. Many EV last-mile delivery players can even use this information to demand lower insurance premiums based on good driving behaviour. The telematics sales are expected to grow at 16 percent a year for the next decade. Some large EV last-mile delivery companies are working to digitize paper-based processes by using blockchain’s digital ledger, enabling secure information exchange between supply chain partners.

EV last-mile delivery companies should also focus on software solutions that allow for dynamic route allocation based on delivery needs and real-time traffic conditions. It helps in finding parking spaces during the delivery to optimise time. These data and technologies should be integrated with the capacity management and tour optimisation systems of freight and courier, express, parcel and postal carriers. These automated technologies, data and robotics supports faster turnaround times at depots and again need to be integrated with software solutions that allow the driver to find parcels and packages quickly. It improves the productivity of the driver while also optimising other cost factors such as fuel and maintenance.

The introduction of data and digitization of the EV last-mile delivery vehicles through the application of sensors and integration of data from across the supply chain could enable carriers to create a virtual model of the network. This model can be used to compute and compare multiple scenarios in real-time, enhancing decision-making and increasing business efficiency.

Akash Gupta

The author is Co-Founder & CEO of Zypp Electric India’s leading last-mile delivery EV startup.