5 Innovative Strategies to Tackle On-Demand Delivery Challenges

With the sweet promise of ultra-convenience, on-demand delivery, aka the platform-to-customer delivery model, is rapidly gaining an audience across the globe. Statista reports that the global on-demand delivery market will have 1.52 bn users by 2027, and the average revenue per user is expected to be USD 184.20 globally. While the market opportunity is lucrative, businesses must rethink their delivery logistics and planning strategies to keep their losses from eroding their bottom lines.

The on-demand delivery space has multiple complexities owing to varying order types, different delivery models, and stringent delivery SLAs. Further, businesses have to deliver excellent customer experiences while adhering to SLAs and keeping the cost and operational constraints in mind.

Here are some innovative strategies for on-demand delivery businesses to help them achieve all this and stay ahead of the competition.

5 Expert Strategies to Overcome On-Demand Delivery Challenges

#1 – Intelligent Order Allocation for Improved Delivery Efficiency

Manual order allocation is tedious and inefficient owing to the complexity of the on-demand delivery model. Finding the most profitable order and rider mappings while keeping cost and time constraints in mind is neither scalable nor wise when done manually. 

On the other hand, auto-allocation engines can automate order allocation keeping all the allocation rules and delivery constraints in mind, within minutes, and help improve SLA adherence. Right when the Order Management System (OMS) captures an order, the optimization engine checks for all the available resources (vehicles, drivers, etc.) and allocation rules. These allocation rules are highly configurable and can automate order allocation based on multiple criteria, such as order type, order amount, delivery location, geographic/civic constraints, rider costs, etc.

This helps reduce delivery costs as businesses can always prioritize self-owned/more profitable riders over freelance or costly riders. They can configure allocation criteria when required without compromising delivery SLAs and ballooning delivery costs.

#2 – Automated Order and Vehicle Mapping for Reduced Fleet Costs

Order and vehicle combo might incur higher delivery costs if the rider uses a bike or scooter for deliveries that can be easily fulfilled on foot, or bicycles, which is mostly the case in hyperlocal deliveries. However, calculating the most profitable pairings, allocating the resources, and completing the deliveries on time are impossible in manually-managed systems.

Intelligent on-demand delivery platforms come with in-built delivery optimization routines that enable businesses to map the most profitable vehicles with orders depending on multiple delivery criteria, such as distance, time, delivery specifications, order type, etc. This reduces fuel and asset costs, and ensures highly efficient on-demand delivery operations without disrupting the SLAs.

#3 – Real-Time Route Optimization for Non-Stop Timely Deliveries

Manually-planned routes suffer from a critical flaw – the inability to take the real-time road and traffic conditions into account while generating delivery routes. Any sudden disruption, such as accident, traffic, etc., can lead to SLA breaches and delivery delays, ultimately amounting to customer loss. Further, creating routes for multiple orders in real-time while ensuring high delivery efficiency requires intelligent technology. 

Advanced on-demand delivery management solutions come with AI-powered real-time route optimization and dynamic re-routing functionalities. Thus, in events such as roadblocks, traffic jams, etc., the system instantly generates an alternative route such that the delivery SLA, schedules, and overall efficiency are not compromised. 

#4 – Dynamic En-Route Order Clubbing

Another innovative approach to reduce delivery costs and improve fleet utilization is to club the en-route orders in real-time. This helps businesses to maintain rider productivity at all times and consistently meet SLA guidelines. 

The routing software automatically maps multiple deliveries en route, and the smart delivery optimization engine clubs multiple orders based on destination and proximity between two orders. To ensure high delivery efficiency and equal load distribution among drivers, the software also limits the maximum number of orders that can be clubbed. This boosts delivery productivity and reduces trip volumes.

#5 – Geofencing Assets for Uninterrupted Delivery Planning

Geofencing assets is another excellent way businesses can improve on-demand delivery efficiency. Every rider/vehicle/pair can be geofenced to the store and delivery location. Thus, once the rider enters the store’s geofence, they are reflected in the system for another order allocation before reaching the store. Likewise, geofencing driver to delivery locations facilitates automated delivery authentication and validation checks in the system for added efficiency and accuracy.

Thus, businesses can utilize the existing fleet most efficiently and reduce the need for freelance riders. It is impossible in manually-managed systems, where once the rider is out-for-delivery, they are only considered for order allocation once they come back. 

Intelligent on-demand delivery management solutions are the most reliable and effective tools to solve the exponentially evolving complexities in the on-demand delivery model. With advanced capabilities and smart functionalities, on-demand delivery platforms are definitely game changers for industry stakeholders. As the world moves towards faster, more personalized, and highly curated on-demand delivery experiences, their adoption and evolution is going to be one of the most crucial trends to watch out for.