Almost half of packages to be delivered in 2 hours by 2028

UPS X-Port Challenge for small businesses
On-demand shipping will be a must by 2028. (UPS)

Retailers, manufacturers and transportation and logistic firms are all preparing to meet growing needs of an on-demand economy. The pace is quickening; a recent study by Zebra Technologies Corporation revealed that 78% of logistics companies expect to provide same-day delivery by 2023 with as many as 40% to offer two-hour delivery by 2028. Also growing in popularity, 87% of survey respondents expect to use crowd-sourced delivery or a network of drivers to complete orders by 2028. 

In order to reach these goals, Jim Hilton, manufacturing and transportation and logistics global principal at Zebra Technologies, said that companies are turning to digital technology and analytics to bring heightened automation, merchandise visibility and business intelligence to keep up with consumer demands. 

"Driven by the always-connected, tech-savvy shopper, retailers, manufacturers and logistics companies are collaborating and swapping roles in uncharted ways to meet shoppers’ omnichannel product fulfillment and delivery expectations," Hilton said. 

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But logistics companies have their work cut out for them, as only 39% of supply chain respondents in the study are operating at an omnichannel level. At least one-third cited reducing backorders as their biggest challenge to reaching omnichannel fulfillment, followed by inventory allocation and freight costs.

Retailers are moving toward omnichannel fulfillment by investing in BOPIS (86%), and 76% are currently using store inventory to fulfill online orders. In other words, many stores are rethinking the physical space to accommodate e-commerce pickups and returns. 

One of the biggest challenges all around for smooth, omnichannel experiences lies in managing product returns, a challenge for 87% of all survey respondents. And free and fast delivery of products corresponds with additional product returns. More than 60% of retailers that currently do not offer free shipping, free returns or same-day delivery plan to, and 44% will outsource returns management to a third party. 

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In order to accomplish this, companies will need to update their processes. Although 72% said they use barcodes, 55% are still using pen-and-paper based processes to enable logistics. However, 94% of these companies plan to be using mobile computers with barcode scanners for omnichannel logistics by 2021, improving real-time access to warehouse management systems. 

To work in conjunction with mobile barcode scanners, the RFID technology for inventory management are expected to grow by 49% in the next few years, enabling up-to-the-minute inventory lookup. 

And specifically in North America, it seems retailers, manufacturers and logistics companies are struggling for better inventory accuracy, ranking it at 74% accuracy and needing it to be around 83% in order to handle the rapid rise of omnichannel logistics.