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DHL Getting Into Last Mile Delivery Market

March 16, 2018

Parcel Metro uses customized software that allows DHL eCommerce to create a “virtual delivery network” of local and regional contract couriers and crowd-sourced providers. Image: DHL
Parcel Metro uses customized software that allows DHL eCommerce to create a “virtual delivery network” of local and regional contract couriers and crowd-sourced providers. Image: DHL

Germany-based logistics company DHL is targeting e-commerce demand in the U.S., announcing new technologies and delivery solutions for urban consumers.

The company’s DHL eCommerce unit launched DHL Parcel Metro, a new fast and flexible service for online retailers that meets consumers’ increasing demand for same-day and next-day delivery. The new service is now available in Chicago, New York and Los Angeles, and will be launched in Dallas, Atlanta, San Francisco, and Washington, D.C., later in the year.

Parcel Metro uses customized software that allows DHL eCommerce to create a “virtual delivery network” of local and regional contract couriers and crowd-sourced providers “to ensure maximum flexibility and capacity over the last mile.” Retailers can offer a fully branded suite of delivery options to their customers. Consumers can track shipments in real-time online, as well as communicate special instructions to their courier, reschedule a delivery, and rate their delivery experience.

The Wall Street Journal notes that DHL’s move could increase competition for both UPS and FedEx, pointing out that both companies have been raising prices aggressively to help cover the costs of surging residential deliveries. “A new, low-cost entrant to the market could make that more difficult.”

WSJ reports that DHL pulled back its U.S. express-delivery unit in 2008 after investing billions of dollars to challenge UPS and FedEx. DHL eCommerce, originally called Global Post, kept its U.S. presence after the broader DHL withdrawal and operates 21 warehouses. It has used those to focus on international parcel shipments, relying on the U.S. Postal Service to make the domestic deliveries from its warehouses.

“The DHL Parcel Metro solution provides a technology solution to the last mile opportunity,” said Charles Brewer, CEO, DHL eCommerce.” DHL Parcel Metro is part of a number of innovations we are actively implementing, including augmented reality glasses for greater pick accuracy, ‘follow me’ robots, and autonomous vehicles.”

DHL Supply Chain has introduced robotics – including LocusBots and Sawyer collaborative robots – and augmented reality glasses in warehouse operations to improve productivity in the fulfillment of customer orders. DHL Express has been piloting artificial intelligence in its customer applications to further enhance its customer service. The company says increased automation at hubs and gateways has led to a 10% increase in shipment processing accuracy, while its On Demand Delivery online service has increased the first-time delivery success for e-commerce shipments from 80% to 92%.

“Eighty-six percent of consumers associate delivery as part of their total online shopping experience, according to recent research. It’s therefore important for DHL to offer services that not only meet their needs, but do so in a highly consistent fashion,” said Lee Spratt, CEO, DHL eCommerce Americas.

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