Three years into the Covid-19 pandemic, the “bullwhip effect” of misaligned capacity and demand persists, contributing to labor and equipment shortages alongside port and inland congestion. Balancing capacity and demand has proven elusive, as many companies still lack full real-time, end-to-end visibility into the location and status of finished product and inputs. 

The rise of B2C e-commerce has amplified the challenge, with more and smaller shipments, multichannel fulfillment options and high customer expectations for time-definite delivery. Sheltering in place and remote work during COVID have extended the B2C model to many traditional brick and mortar businesses, especially in retail, concentrating cost and capex investment impacts in the final mile.

It should not be surprising, then, that the last mile is also where opportunities for savings and competitive advantage are greatest. More than ever, the key to managing final-mile costs while reliably meeting service commitments is the capability to sense and respond to demand amid market volatility. 

Conventional transportation management systems (TMS) were never designed to provide full shipment visibility, because their focus is on completion of discrete steps during order fulfillment, leaving large gaps in visibility when goods are in transit or storage. 

Limited track and trace visibility makes it hard to accurately forecast and update arrival times, or to locate and redirect available inventory in the event of an exception alert, sudden disruption or changing market conditions. A partial picture of current and historic shipment data, meanwhile, limits analytic capability crucial to anticipating future demands, potential supply chain chokepoints, or measuring system, workforce and supplier performance. 

Modular, cloud-based software solutions, layered over a TMS, provide needed visibility and analytics to dramatically improve demand forecasting, but a proliferation of tech-focused solutions in the market often lack in-house expertise and partnerships on the business or supply chain side, necessitating third-party support with system integration, organizational structure and change management.

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