Mr. Pankaj Sachdeva, Vice President, Data Science & Analytics, and Managing Director, India Innovation at Pitney Bowes spoke with CXOToday about the key challenges which e-commerce companies are facing that further add to the customer frustration, the need for efficient warehouse and parcel management in India and how can new-age technology help address these issues.
- What key challenges are e-commerce companies facing that further add to customer frustration?
We know that the global pandemic brought with it a massive shift in buying behaviors and put pressure on ecommerce companies to deliver despite supply shortages and increasing demands from retails and customers. Ecommerce companies are facing several challenges in fulfilling deliveries such as:
- Supply Chain Disruptions: One of the main challenges companies are facing is COVID-induced supply chain disruptions. We are in a period where COVID has not entirely receded. This causes disturbances in the supply chain. As most of the warehouse workforce is expected to be physically present on site, the health & attendance of workers is getting impacted leading to delivery delays, ultimately affecting customer experience.
- Demand Forecasting: Companies are unable to adequately anticipate demand, directly impacting the customer experience. Predicting client behavior which is contingent on competition and market conditions is also difficult. Without a proper understanding and visibility of the demand, companies face challenges in managing parcel volumes, staffing, and on-time deliveries. Tracking relevant parameters and anticipating consumer demand is critical to addressing this issue.
- Returns Management: As the e-commerceis getting exposure to newer segments, customers still seek the same experience they would get in a physical store. Companies dealing with clothing, footwear, apparel, and electronics face particularly large proportions of returns for orders that are COD (Cash on Delivery). As returns management involves many costs, complexities, even possible damage to a product, efficient returns processes and policies that are cost-effective and, simultaneously, in line with customer expectations are fundamental.
- Do you think there is a need for efficient warehouse and parcel management in India?
Warehouse and parcel management has improved manyfold over the last decade. However, with a large population in India being predominantly below 35 years of age and contributing to the rapid growth of e-commerce and changing customer behavior patterns, there is a clear need for improvements in warehouse and parcel management. Being a critical part of the supply chain, warehouses are now expected to be more than just storage facilities. To keep up with the pace of the industry and demand, warehouses need to be equipped with the latest in technology and infrastructure to support efficient parcel management, on-time and faster deliveries, and better returns management. Adopting leading edge technologies like IoT, robotics, and automation will be essential for companies to stay competitive.
- How can new-age technology help address these issues?
Automation and robotics are ideal for scaling up operations quickly in warehouses. Many advanced robotics solutions are being developed across multiple warehouse and parcel management functions, which allow companies to handle larger volumes in less time. IoT devices are also gaining traction in parcel tracking, equipment maintenance, and are helping in decision-making. Utilizing customer and operations data is essential to help eliminate uncertainties and identify anomalies in the logistics network. Building reliable forecasting models by leveraging Data Science concepts to plan labor requirements and parcel network is crucial. Reliance on prescriptive analytics in decision-making improves performance, business outcomes, and client experience. We are seeing an uptake in AR/VR technology in e-commerce as it drastically improves user experience. It creates a real-life experience for the user in a virtual environment that helps customers choose better, reducing returns in the long run.
- How is Pitney Bowes working towards reducing the e-commerce, shipping, and mailing complexities?
At Pitney Bowes, we rely on Automation, Data, and Data Science techniques which form an integral part of our product and service experiences that improve business outcomes for our clients. Pitney Bowes recently signed a $23M deal with Ambi Robotics to equip our warehouses with advanced AI-powered robotics to speed up warehouse sorting and parcel processing activities. Our metering solutions are equipped with IoT devices that generate real-time insights on product usage patterns, customer churn predictions, and repair and replacement schedules, on-time without downtime for clients.
Being a data-driven organization, we have developed an extensive catalog of Machine Learning-based data solutions that help us forecast parcel volumes, optimize warehouse operations, make real-time decisions, predict expected delivery dates for customers, and more. We are strengthening our IoT capabilities at our facilities to realize cost savings and achieve operational efficiencies. Our capabilities also enable us to identify network anomalies and build simulation models to operationalize our facilities.
In India, we are developing IoT-powered applications to support operations in sorting centers that are a part of our global ecommerce logistics network, to quickly build and deploy such business-critical applications to deliver better value to our clients.
- How is IoT addressing the last mile & delivery time challenges in India?
E-commerce companies are heavily investing in automation technologies such as IoT to stay ahead of the curve and mitigate the frequently encountered last mile and delivery time challenges. IoT has made its way into most parts of the supply-chain process, right from warehousing to delivery. IoT devices on trucks help understand any real-time anomalies in the delivery route. The IoT devices embedded in trucks share real-time truck speed, location, and behavior, among several other parameters that can be tracked and analyzed. This data helps improve the driver’s performance, map delivery routes, and dynamically allocate alternative routes for quick deliveries. This data also helps companies provide a real-time view of package location and better-estimated delivery dates/times to the end user. The electronic proof of delivery ensures that the package is delivered to the correct location.
With the swift growth of the ecommerce industry, companies will need to continue innovating and investing in IOT and other such new-age technologies to create efficient, agile, and sustainabile supply operations.