Understanding the language of logistics
What is PUDO?
What is e-commerce?
According to Wikipedia, e-commerce is the activity of buying or selling of products on online services or over the Internet. Electronic commerce draws on technologies such as mobile commerce, electronic funds transfer, supply chain management, Internet marketing, online transaction processing, electronic data interchange (EDI), inventory management systems, and automated data collection systems. According to Statista, global e-commerce valuation exceeds $4T USD currently and is projected to approach $5T by 2021. In the Americas, e-commerce valuation exceeds $827B currently and is expected to approach $1T by 2021.
What is the last mile?
A metaphorical term widely used to describe the final leg of a journey or delivery of a product or service, to the customer. Originally coined during the telecommunications revolution, to describe the last link in the chain of delivering internet or cable services from the furthest hub in the network of consecutively smaller hubs, to individual residences; most-often associated with bottlenecks, costs and complexity.
What is last-mile gridlock?
Parcel delivery describes the entire journey that a parcel makes from the moment an e-commerce item is ordered, until it lands in the hands of the consignee (purchaser). The gridlock crisis happened because an unsustainable 53% of the entire cost of parcel delivery is consumed during the last mile. Three major roadblocks contribute to last-mile gridlock.
- Because e-commerce growth exploded unexpectedly quickly, stakeholders in the ecosystem had no choice but to rely on two primary and outdated modes of delivery, namely: traditional federal mail systems originally designed to deliver envelopes and small parcels to occupied homes, and traditional courier systems built to deliver envelopes and parcels between businesses.
- These systems, however, did not consider the costs of changing demographics and consumer behavior, and crippling statistics like: nobody home to receive deliveries +35% of the time; 50% of failed first-attempt delivery resulting in doorstep-dropped parcels.
- This in turn leading to over $5.6B annual parcel theft; escalating spoilage costs on perishable goods; and the +30% of parcels designated returned to sender (wrong size, unsuitable, unwanted).
What is the e-commerce ecosystem?
The complex network or interconnected system that comprises the online shopping community including all of its stakeholders, infrastructure, culture and history — online shoppers, retailers, couriers, postal services, advertising and marketing, technology, transportation and delivery, support services and all related parties and beneficiaries.
What is logistics?
The detailed organization and implementation of a complex operation; the management of the flow of things between the point of origin and the point of consumption in order to meet requirements of customers or corporations. As related to e-commerce, logistics refers to the intelligence, technology and physical steps involved in moving goods from their point of origin on ordering, to the consignee and/or returning unwanted or unsuitable goods to their original or alternate destination. The term logistics refers to goods travelling both to and from consignees.
What is return logistics?
On average globally, +35% of online goods sold across all retail industries are destined ‘return to sender’ status by the consignee or due to undeliverable status. Return-logistics refers only to the return journey, and due to the many variables associated with returns, the process is much more complex and costly than forward logistics (original delivery of goods to consignees). Currently, the value of e-commerce in the Americas exceeded $550B, but the value of returned goods alone is estimated to reach that same number by the end of 2021. Resolving the return-logistics crisis is a priority for all stakeholders.
What is failed first attempt?
When nobody is home to receive a parcel delivery the first time a carrier attempts to deliver it, the parcel is considered a ‘failed first attempt’. Currently +35% of parcels are undeliverable on the first attempt; a major roadblock contributing to last-mile gridlock.
What is porch piracy?
Of the +35% of e-commerce parcels that are considered undeliverable on first attempt (that, is no one is home to accept delivery), more than half are left unattended near or at the front door of consignees. These parcels, known as ‘doorstep drops’ are vulnerable to theft and have spawned a criminal industry known as ‘porch piracy’. Porch piracy flourishes during the busy holiday season. The cost of porch piracy exceeds $5.6B annually, involves 2.6M stolen parcels, and affects 20% of homeowners; a major roadblock contributing to last-mile gridlock.
What is carrier-neutral?
Carrier neutrality is unique to PUDOpoint Counters in that operators accept deliveries on behalf of consignees, from any courier or carrier regardless of their brand or affiliation. A consignee address that facilitates the receipt and return of parcels from all sources, including national postal services, is considered carrier-neutral. Branded depots operated by UPS, FedEx, Canada Post, USPS, etc., are not carrier-neutral as they accept and manage theur own parcels exclusively. PUDO is carrier-neutral and receives parcels from all B2C, B2B and government carriers.
What is a 3PL?
Third Party Logistics (3PL) is a supply chain management and logistics industry term referring to a critical group of businesses used by retailers (and wholesalers) as third-party warehousing, distribution and fulfillment centres. 3PLs are the giants of e-commerce, moving millions of parcels daily through the ecosystem, using complex integrated inventory, warehousing, forward and return logistics that can be scaled and customized to suit the needs of diverse domestic and international clients working individually or in tandem to fulfill consignee purchases. Resolving last-mile gridlock is of particular importance to 3PLs.
What is a marketplace?
E-commerce marketplaces are online portals that aggregate goods and services sold by a large number of suppliers, i.e. eBay, Etsy, Amazon, etc. The marketplaces also direct ‘return to sender’ parcels for return to the retailer, or to the 3PL for re-stock, assessment, sorting, recycling, or re-sale, as determined by the original seller.
What is a courier depot?
When e-commerce parcels are undeliverable on first attempt, and are not doorstep-dropped, they are almost always returned to the branded courier depot for a) second attempt delivery, or b) pick-up by the consignee. A door hangtag is left (or an SMS sent) to advise consignee when the second attempt delivery will be made, or when and where pick-up can be made. Courier Depots include post offices, branded courier depots in malls and business centres and airports. Depots generally offer limited business hours during weekdays only, and can be located far from consignee addresses. Depots manage their own parcels exclusively and will not receive or return parcels for other carriers; they are not carrier-neutral.