Internet shopping a ‘tsunami’ for global logistics

13 / 06 / 2018

According to David Jinks, head of consumer research at London-headquartered package delivery service provider ParcelHero, internet shopping will transform global commerce and logistics within a decade.

In a speech at the Digital Ship Maritime CIO in London on June 21, he will sum up: “From Amazon’s own aircraft and shipping services, to deliveries direct to consumers’ fridges; and from blockchain and the IoT [Internet of Things] to 3D printing – the impact of e-commerce means global supply chains will be transformed by 2028.

“When, back in May 1984, a 72-year-old Gateshead grandmother, named Mrs Jane Snowball, purchased groceries from her local Tesco store in the world's first ever online home shopping transaction, a chain reaction was started, the full impact of which is still only beginning to be realised.

“From the BHS collapse to House of Fraser’s current woes it’s carnage on the High Street; and this tsunami will reach global trading network[s] next,” he will warn.

Indeed, Jinks believes internet shopping poses a greater threat to the traditional global supply chain than protectionist trade policies, as companies like Amazon will use their own logistics services to drive international trade – bypassing traditional service providers.

At the conference, he will point out: “By persuading retailers to use its Fulfilment by Amazon Pan European/US services, Amazon will create new shipping patterns and transform the industry. It’s all part of its avowed aim to be the pipeline through which everything is delivered.”

Another aspect of the transformation Jinks foresees is a shift towards a new hub-and-spoke model, with mega hubs on city outskirts feeding small hubs inside urban areas and electric vehicles, droids and drones used for final mile deliveries.

Amazon’s “floating warehouses”, known as Airborne Fulfilment Centres, meanwhile, are capable of sorting items en route and could supply flexible capacity at peak delivery times.

The IoT is another means by which storage requirements could be reduced, as appliances such as fridges anticipate demand and re-order supplies automatically.

As for the threat of 3D printing to air freight, Jinks considers: “It’s probable manufacturers and e-commerce retailers will develop a hybrid manufacturing and distribution centre, creating and despatching larger items that can’t be produced on a home 3D printer.

“Perhaps one day the only thing we ever ship globally will be strips of plastic and metals for use in domestic, hybrid manufacturing/distribution centres and High Street printers. 3D printing will certainly create a new dimension in supply chains as products are made available for delivery literally hot off the press,” he will say at the conference.