The document discusses how companies must adapt their last mile delivery strategies to meet evolving consumer expectations around delivery and pick-up options. It notes that online retail is growing significantly and consumers increasingly demand flexibility in how and where they receive purchases. Companies that offer customers choice and seamless integration across channels through innovative last mile solutions, like SmartCentres' Penguin Pick-Up delivery locations, will be better positioned competitively to serve consumers how they want. The last mile presents both opportunities and threats, so companies must ask the right questions to efficiently manage their supply chains and distribution as consumer demands change.

1. The last mile: The next battleground for businesses adapting to changing consumer behaviour

2. The digital consumer
Online shopping has re-shaped all aspects of the
buying experience, from product research through
to purchase and beyond. Customers already expect:
Choice Flexibility Personalization
Now, consumer businesses must go
beyond ‘anytime, anywhere’.

3. The improvement imperative
Canadian online retail
is predicted to increase
70% by 2018, from
$20 billion in 2013 to
$34 billion*.
The ever-increasing volume
of online purchases means
consumer businesses must
prepare strategies now to
serve their consumers any
way they want to be served,
or risk getting left behind.
* Source: Forrester Research

4. ‘Any way’
This is a seamless integration
of channels and platforms.
Particularly important is the
last mile, an often overlooked
but key piece of the purchase
experience between the sale
and the final touch-point of
delivery.
way

5. ‘Any way’
Today’s consumer, the Consumer-in-Chief, is highly
evolved and demands an ‘any way’ experience–
expecting any and all last mile options, including:
Ship home
purchases
made in-store
Pick up online
purchases
in-store
Drive-through
pick-up points
Flexible and
hassle-free
returns

6. The distribution dilemma
The last mile typically accounts for
75%-85%
of total distribution costs.
How do companies balance increasing
customer demands and the bottom line?

7. Innovators welcome
Right now, the last mile presents both
an opportunity and a threat to those
putting the pieces together.
As businesses look for solutions, truly
innovative thinking and non-traditional
players may rise to the top.

8. In- and out-of-the-box solutions
Car-door delivery
pick-up locations
Drive-through
pick-up
Lockers at pick-up
locations

9. Case study:
SmartCentres is Canada’s largest developer and
operator of unenclosed shopping centres.
The business has traditionally been bricks-and-mortar
stores: physical real estate. But with online shopping
increasing, it was time for something new.

10. (Case study continued...)
Penguin Pick-Up takes flight
SmartCentres knows that 95% of Canadians
live within 15 km of a SmartCentre location*.
The opportunity: parcel delivery centres in convenient
locations offering a one-stop-shop for click-and-collect.
The result: Penguin Pick-Up, a network of pick-up locations
that customers can access at their own convenience.
* Source: SmartCentre press release

11. (Case study continued...)
Bridging the gap
Penguin Pick-Up integrates convenience for
retailers, brands and manufacturers as well
as consumers by offering:
Delivery for not
only SmartCentres
tenants but others
in the network
Safe and secure
storage of
merchandise
Easy pick-up and
returns

12. Now trending: #pickup
45%
of U.K. consumers
used click-and-collect
services over
Christmas 2013.
19%
of U.S. customers
clicked-and-collected
their
purchases in
2014, up from
12% in 2013.
Source: Forrester Research

13. Now trending: #pickup
One French hyper-market
chain has
352
click-and-collect
locations, with sales
in the segment jumping
68%
compared to overall
growth of 4.7%.
A U.K. grocer launched a
full click-and-collect service
at customer-specified times
and
locker
systems
for picking up both food
and non-food orders.
Source: Forrester Research

14. Consumer demand
Being able to buy
online and pick up
at a convenient
location is ‘very
important’ to about
41% of multi-channel
shoppers.
Even then, about 47% of
shoppers use in-store pick-up
to avoid online shipping costs.
25% prefer to collect their
orders the same day they buy
them and 10% pick up their
purchases in-store because
they find it more convenient
than home delivery.
Source: Forrester Research

15. Reflection required
The last mile is changing
and becoming more
complex. The impacts
are far-reaching, with
implications for:
Supply chain
Staff
Technology
Real estate Analytics

16. Consider this
Efficiently managing supply chains
is both a competitive advantage
and a brand differentiator:
72% of the supply chain leaders
Deloitte surveyed said that service
levels would be a key differentiator
in the years to come.
Organizations will
need to invest in the
processes and systems
required to effectively
manage inventory
across each channel.

17. Consider this
Warehousing and logistics
decisions will need to
consider the needs of
traditional and online
channels, and support
efficient and fast order
fulfilment and delivery.
Store formats, distribution
centre networks and even the
choice of shipping partners will
need to be determined based
on their contribution to giving
consumers what they want,
quickly and efficiently.

18. Ask yourself the right questions
Are you
collecting and
analyzing data
throughout the
last mile?
How do your
operations
currently handle
the last mile?
Do you
understand
your consumers’
purchasing
patterns and
needs?
Is your
distribution
system working
efficiently?
Have you adjusted
inventory with
online purchases
forecasted to
increase?
Who are your
partners?
Are you
connecting with
your consumer
from moment
of sale to
delivery?

19. Last mile
The last mile is the
next battleground
Companies that best meet consumers’
expectations and deliver a brand
experience of choice and customization
will be better positioned to get ahead
of the competition.

20. The first word on the last mile
For more information about the consumer evolution, read
our report The consumer evolution: Changing behaviours
trigger new business models
To learn more about how you can develop a strong last-mile
strategy for your business, contact one of our leaders:
Ryan Brain
National
Consumer Business Leader
rbrain@deloitte.ca
416-643-8210
Jennifer Lee
National
Omnichannel Leader
jenniferlee@deloitte.ca
416-874-3344
Rob Carruthers
Atlantic
Consumer Business Leader
rcarruthers@deloitte.ca
902-721-5645
Lucie Lazar
Quebec
Consumer Business Leader
lulazar@deloitte.ca
514-393-7388
Rick Kohn
British Columbia
Consumer Business Leader
rkohn@deloitte.ca
604-640-3228
Sherri Penner
Ontario
Consumer Business Leader
spenner@deloitte.ca
905-323-6014

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