The Uberfication of Logistics

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The Uber model is becoming essential for businesses to implement into their supply chains. Customers crave the ability to order items for fast delivery and arrange shipments with ease; it is abundantly clear that the Uber model facilitates this desire.

Uber itself has recently launched UberRUSH as an accessible courier service in New York, Chicago, and San Francisco. Customers can use the app to find vehicles in their area, specify their bespoke needs, organise an efficient service, whilst tracking their consignments. Drivers can then sign up and work under Uber, maintaining their own working schedules. What’s the catch? Plenty of other companies have capitalised on the same model since and have proved very successful. However, many concerns have been raised regarding how this new structure will impact on the shipping industry, particularly considering its extremely rapid growth in the market.

The very nature of an app-based service makes for a degree of both efficiency and visibility previously unheard of. With ease of ordering, customers can locate the best vehicle in their area and provide any necessary bespoke instructions to receive a tailored service. Additionally, the apps provide full visibility; the vehicles can be tracked throughout the journey, which means that customers always know the live status of every journey. Queries have been raised, however, with regards to the safety of the transported items. Security is a huge concern. What’s to stop a driver registering, finding a load of value, and thieving the goods? It is clearly highly important that security measures are established to ward off criminal activity.

Many argue that the security anxieties of uberfication is a huge turn-off. The customer is likely to be working with different drivers each and every time – how can they be expected to trust this above a trusted broker that they have been working with for some time? This is understandably a huge leap for a lot of people. Moreover, from a business perspective, their broker would have previously worked out all the logistics for them. With uberfication, the responsibility lies in the hands of the sender. This may require extra staff, or put a strain on the workload of existing employees.

Companies are under much pressure to keep up with the uberfication of logistics. Without adaptation, freight brokers, for example, could end up losing much business. There is considerable demand for these businesses to create their own apps in order to comply with the uberfication trend. These uber-style delivery drivers are also able to shape their activity around individual requirements, brokers need to keep up with this expected personalised service.

Furthermore, with reference to a dynamic service, uber-style apps are able to immediately generate tailored prices for each job. These prices are likely to vary each time and are dependent upon a great many factors; brokers will need to ensure they also keep up with this side of the trend. The immediacy of payment transfer is also a huge plus point. Transactions are done straight away as soon as the job is completed.

There are many clear environmental benefits of the uberfication of logistics, predominantly when making use of return loads. Too frequently, vehicles of all sizes are travelling unloaded. Uber-style apps will allow people to book these vehicles for back-loads to ensure that the vehicle isn’t wasting mileage not achieving anything. Goods can also be consolidated with uberfication. One vehicle may take several customers’ consignments rather than several vehicles all travelling independently. This is also effective in decongesting urban areas. Less vehicles clogging up cities will certainly benefit air quality. Depots and ports need to be ready for this consolidation, plenty argue that they are not prepared for this loading arrangement.

With the uberfication of logistics taking hold, brokers need to be liberal in adapting their businesses before losing clients to app-based services. Plenty of companies are racing ahead to establish themselves as uber-style leaders in their regions and the rest of the logistics industry needs to keep up!

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