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Overview

Deepening globalisation has resulted in more businesses across the Association of Southeast Asian Nations (ASEAN) engaging in an increasingly complex network of trade. Global supply chains consist of a highly synchronised series of steps, from the extraction of raw materials and manufacturing of goods to the distribution of finished products to the end user. Last mile delivery is the final leg of the supply chain, where the product reaches its final delivery destination. In e-commerce, this involves the process where the product is shipped from the warehouse or shop to the customer’s address. Decisions on the exact modality depend on the volume and type of goods being delivered, which in turn have implications on cost. It is estimated that the cost of last mile delivery can account for up to 75% of the total supply chain cost, thereby being a key driver of price competitiveness for retailers and consumers.

Ensuring efficient last mile delivery is particularly important for ASEAN, where e-commerce is seeing significant growth post-pandemic and is identified as a key driver of growth of the region’s digital economy agenda. For example, in Indonesia, it is estimated that online shopping is estimated to account for 60% of the total volume of sales in the country. Having robust last mile delivery options becomes a competitive advantage for businesses and a key determinant of their supply chain resilience.

Last mile delivery holds significant importance in shaping the overall consumer experience and productivity of e-commerce activities. Considerations for factors such as real-time tracking and communication, sustainable packaging and multiple delivery options that are standardised and optimised can improve the overall logistics process to accommodate the growth in demand for e-commerce in the region.

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