Anar Mammadov is the CEO of Senpex Technology and a software development professional with over 18 years experience in enterprise solutions.
In the world of supply chain logistics, “cold chain” refers to the special logistical operations that must be undertaken to transport products requiring cold storage. Perishable foods, medical supplies and flowers are just a few examples of products that require cold chain logistics. Transporting these items often involves special considerations at all stages of the journey, with last-mile logistics presenting the biggest challenge.
Last-mile logistics focuses on getting products into the hands of the end consumer and typically involves delivering products to heavily congested areas, meaning traffic delays and other navigational issues threaten efficiency. Today’s consumers also expect delivery companies to provide expedited delivery times, such as next-day delivery for most e-commerce purchases and one-hour delivery for prepared foods or pharmacy orders.
The Unique Last-Mile Challenges Of Cold Storage Transportation
Cold chain items introduce additional complexities to last-mile logistics, but the most obvious enhancement required for cold chain deliveries is vehicles and other equipment that can maintain cold temperatures. Providing that capability requires an additional investment for last-mile logistics providers and additional effort for vehicle maintenance. Drivers for refrigerated vehicles, commonly known as reefer drivers, also require additional training and demand higher pay.
Route optimization is a critical component of last-mile logistics for refrigerated items since a lack of efficiency in routing or unanticipated delays can lead to food spoilage. Cold storage vehicles require more fuel to operate as well, further increasing the costs associated with inefficient routes.
Hitting delivery windows is also more critical for cold chain transportation, which places a premium on route planning and execution. Returning or recalling products resulting from missed delivery windows is a more complex and costly process with these items.
The care necessary for cold chain logistics makes it more important to provide customers with dynamic updates on the status of their delivery. Because they require ongoing cold storage, cold chain items cannot simply be left on a doorstep. This demands heightened coordination with the recipient to ensure items can be successfully delivered.
Cold chain logistics can also require compliance with regulations focused on consumer safety, which can include implementing record-keeping processes that document temperature readings and transportation timetables. Regulations may require logistics companies to obtain licenses, certifications, and permits that are not required to transport more conventional items.
Each of these factors requires a larger investment on the front end. Consequently, last-mile logistics companies focusing on cold storage may need more of an on-ramp to profitability.
Addressing Cold Storage Transportation Challenges
Closely monitoring the effectiveness of cold storage equipment is critical for cold chain logistics. Internet of Things (IoT) technology gives logistics companies tools to monitor temperatures in storage spaces at all times. Integrating artificial intelligence (AI) with these systems gives them the capability to automatically make needed adjustments or send alerts if problems are detected.
Integrating AI with telematics platforms can also help companies develop more effective equipment maintenance programs. AI-powered systems can use telematics data for predictive analytics to determine optimal maintenance schedules, increasing the overall efficiency of last-mile logistics while decreasing equipment malfunctions.
Leveraging AI for route optimization is another step that helps promote success in cold chain logistics. AI-powered platforms can evaluate data from several sources in real time, updating routes when weather, traffic or other factors impact their efficiency. AI-powered platforms can automatically send drivers updates when routes are updated.
AI can also empower multi-route optimization. With B2C deliveries, last-mile logistics can involve multiple stops at locations across a broad geographic region, which increases the complexity of determining optimal routes. By leveraging the power of AI, last-mile logistics companies can ensure all factors are considered and all requirements addressed when determining delivery routes.
Increasing transparency in the delivery process is another step that can assist in meeting the unique challenges of cold chain logistics. Automated status updates can help ensure recipients are onsite and available when deliveries arrive, as well as help recipients connect with the delivery company if they need to update the delivery window.
Developing a comprehensive plan for returns and recalls is another important step for effectively managing cold chain last-mile logistics. This can require additional training for delivery personnel, who must manage returns to avoid spoilage and, in some cases, comply with regulatory requirements. Being transparent with their returns and recalls process can also help companies to engender a higher level of trust with customers.
Taking Steps To Improve Current Operations
In many cases, companies can quickly improve the quality of logistics they provide by auditing their current practices to identify inefficiencies. For example, companies can use order tracking platforms to identify patterns associated with returns and recalls. If an analysis reveals that certain drivers have a higher rate of returns, additional training may be able to fix the problem.
To empower effective auditing, companies may need to increase the level of documentation they gather. In the area of returns, for instance, they should have processes in place that document in detail the state of returned goods. If companies are not consistently inspecting items upon return, photographing their condition, and capturing data, they should consider taking steps to establish a more comprehensive return process.
Streamlining processes by removing interim steps can also help improve the efficiency of existing operations. Leveraging APIs can help in this area by ensuring the information needed for delivery is properly collected by vendors and quickly passed to delivery providers. By integrating APIs with e-commerce marketplaces and other order platforms, companies can take advantage of automations to improve efficiency and cut down on operational costs.
Final Thoughts
The demand for cold chain delivery has increased in recent years, especially as a growing number of customers have come to rely on grocery delivery. This creates an opportunity for last-mile logistics companies to increase their volume of business, provided they can meet the enhanced responsibilities inherent in the cold chain delivery process. When combined with reliable cold chain strategies, IoT, AI and other tech tools, they can provide companies with the efficiency they need to manage cold chain logistics.
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