According to Capgemini, the cost of providing last-mile services accounts for 41% of overall supply chain costs. This is explained by the high rate of failed deliveries. Research by Loqate demonstrates that 1 in every 20 online orders (in the UK, USA and Germany) are not delivered at the first attempt which hence further drives costs for retailers. In this regard, parcelhub's survey shows that 65% of 300 retailers consider failed deliveries to be a significant cost to their business. One of the main sources of failed deliveries is incorrect addressing. Loqate demonstrates that retailers not accurately collecting customers' addresses is one of the main reasons why parcels are not delivered at the first attempt.
With the widespread adoption of a more reliable addressing system, the number of failed deliveries dramatically decreases, reducing costs for the industry. The Parcelly integration with what3words aims to provide a solution that combines addressing efficiencies with consumer convenience.
Launched in 2013, what3words is a geocoding system for the unambiguous addressing of geolocations. Dividing the world into a grid of 3m x 3m squares and assigning each one a unique 3-word address, it provides a precise and incredibly simple way to talk about locations. The method is more accurate to define the entrance of a building than a postal address and more memorable than GPS coordinates.
Parcelly's agile Pick-up and Drop-off (PUDO) technology features what3words location details as part of its in-app location partner information. Consumers can communicate their Parcelly location using a 3-word address making the checkout more convenient. Consumers know they will find their Parcelly location immediately, even in an unfamiliar area, giving them peace of mind. It also helps consumers to plan their time more effectively, without having to factor in extra time in case the location is hard to find. On the other hand, Logistics and Retail partners optimise their routes, complete more deliveries the first time and reduce expensive last-mile delivery issues.
Customers are not ready to accept a failed delivery because 'you could not find their house', or worse, you delivered to the wrong one. If you have the precise location of the customer, this cannot happen. If you have the correct building entrance, the correct house, the correct back entrance, then you can optimise your routes better. This means you can deliver more orders and faster, and in the end, this makes the company much more competitive
- Pierre Francois Senior Partnerships Director for Logistics
The latest assessment of this solution by DPD and Mercedes Benz has shown that what3words improves efficiency levels by 15%. Drivers who employ what3words addressing are able to finish their routes 30 minutes before drivers using navigation systems with traditional addresses. 80% of the gained efficiency levels come from what3words locating the best parking spot. This reduces driving time and time spent searching for a place to park. The remaining 20% comes from what3words addressing the precise handover point, reducing drivers’ time on foot.
In conclusion, with the help of what3words' geocoding system, Logistics and Retail partners streamline logistics and supply chain processes and increase efficiency significantly. As the number of packages is continuously increasing and to achieve further optimisation, combining what3words with last-mile PUDO technology powered by Parcelly, allows all stakeholders involved to precisely and conveniently locate, collect, return and deliver parcels.
Source (Header): DB Schenker, 2018