Algorithm-based solution technology has become key to last-mile logistics service, says express delivery startup Borzo. In an exclusive interview with NotiPress, the country manager of Borzo Mexico, Iñaqui de la Peña, assured that artificial intelligence allows optimizing the routes to make deliveries to the last destination of the couriers, and reduces operating costs by 50%.
According to the International Institute of Knowledge Applied to Management (IIAKM), artificial intelligence is a technology that uses large volumes of information to generate solutions with prediction and automation models. In the case of parcel logistics, the technology offers efficient routes based on delivery stops, distance traveled, traffic, and historical vehicle congestion metrics.
According to specialists from the multiple purpose company (sofom) Serfimex Capital, the last mile requires up to 53% of the total delivery logistics costs. Likewise, the growth of electronic commerce (e-commerce) in Mexico generated an increase in the volume of packages, movements, and orders placed on parcel platforms. This fact increased the interest in investing in the parcel and last mile segments, as well as meeting the needs of a more demanding clientele sector, assured the sofom.
Along these lines, the last-mile startup Borzo commented that by the end of 2022 there could be a 70% increase in the number of deliveries compared to 2021. Regarding the needs of customers, Borzo stressed that companies must consider this factor in its last-mile logistics and application of technology. Although there are products with greater benefits through an express service, such as food and beverages, others can benefit from scheduled and periodic deliveries.
Likewise, the country manager reported: last mile technology can determine the type of transportation and the most efficient routes for products that have additional requirements. This is in the case of consumables that need to remain frozen and cannot be in circulation for a long time during delivery routes.
Among the applications of algorithms and artificial intelligence technology for the last mile, Iñaqui de la Peña highlighted Google’s predictions for messaging routes. With accurate information on shipment traffic and security metrics, a longer route can be traveled in less time if it is less congested than the short route.
Also, in terms of security, algorithms can distinguish between risks associated with routes, customer history, and the activity of couriers and delivery men. The technology discussed by the startup has the potential to work all the time and monitor information, in order to optimize both the driver and customer experience.
Data from Borzo shared with the news agency reported that logistics applications and technology could grow 30% during the second half of 2022. In addition to this, businesses looking to put their products in a courier service can obtain significant benefits by resorting to the last-mile platforms, such as reduced operating cost.