Tuesday 22nd Aug 2017 - Logistics & Supply Chain

Could Uber revolutionise home deliveries?

Back in June 2014, when Uber first started making waves in the UK, I suggested that there might be a role for it in goods deliveries (see “It’ll never catch on”)

Malory Davies, Editor

Malory Davies FCILT,
Editor

Well, it didn’t really take Nostradamus to predict that, so it is no great surprise that someone is starting to try it.

What is, perhaps, surprising is that Walmart is the retailer piloting the scheme. CEO Doug McMillon outlined the plan to 14,000 shareholders who crowded into the University of Arkansas’s Bud Walton Arena just down the road from the company’s Bentonville headquarters.

The pilot will trial last mile deliveries by a number of different services. It plans to use Uber in Phoenix, while in Denver it is trialling a similar service called Lyft.

It has also been running a trial at its Sam’s Club operation with Deliv, involving delivery of general merchandise and grocery for business members in Miami.

Deliv is a crowd-source same day delivery service that currently operates in 17 US cities.

The Walmart system allows the customer to place the order online and select a delivery window. A personal shoppers picks the goods in the local store and Walmart requests a driver from one of the services to come to the store pick up the customer’s order, and take it directly to the customer’s location.

The delivery charge is expected to be $7-10 and is paid online. The customer does not pay the driver directly. Walmart also tells the customer which service is being used to deliver the order.

At Sam’s Club, the process is very similar, with personal shoppers preparing the orders for business members, and having their order delivered to their door with Deliv.

This is quite a different business model to that used by Asda, Walmart’s UK subsidiary which has more than 1,500 multi-compartment vans, for home delivery.

It is one thing to have groceries delivered by a uniformed member of staff driving a liveried vehicle, and quite another to them to come from a bloke in a private car – clearly there are issues of security and safety to be taken into account.

But the system could be a option where there is not the density of deliveries to justify a dedicated vehicle.

The Walmart pilots are just starting and if they are successful they could result in a modification of the conventional business model for grocery home deliveries.

 

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