A host of current logistics developments and innovations are focused on the last mile along with upstream transfer from the transit chain – so not just on shipping but also on depots and warehouses. The reasons are twofold. First, the rapidly accelerating pace of the mail-order business, and second, the ongoing trend toward global urbanization. The net result is spiraling demand for deliveries to city-dwellers. According to United Nations (UN) estimates, 55 percent of the world’s 7.62 billion inhabitants are urbanites today; by 2050 that proportion will have risen to 68 percent.
Professor George Q. Huang, Chair of Industrial and Manufacturing Systems Engineering at Hong Kong University, outlines the situation in the vast economic area that takes in China, Hong Kong and Taiwan: “E-commerce in Greater China has exploded in the last few years, which means that delivery logistics are increasingly becoming a bottleneck.”
Indeed, more and more warehouses on various scales are springing up across mainland China to accommodate online orders. “However, they’re still using old-school logistics systems that don’t stand up to present and future requirements,” says Huang. For example, the time from receiving an incoming order to handing over the package to a logistics company is too long. Space utilization in these logistics parks also leaves much to be desired.