The last-mile logistical challenges of an omnichannel grocery retailer: A South African perspective

Abstract

Background: The intense competition between grocery retailers to access new revenue streams has seen brick-and-mortar retailers broadening their services to offer consumers the option of ordering their groceries over the Internet. This is implemented through the implementation of different platforms such as their computer or mobile application − known as omnichannel retailing. Omnichannel grocery retailers are facing several challenges with the last mile of their online supply chain, especially with relation to the home delivery of groceries.

Objectives: The purpose of the article was to gain an understanding of the nature of last-mile logistical challenges hindering the efficiency of an omnichannel grocery retailer in South Africa.

Method: A qualitative methodology was employed; data were collected through an interview with the e-commerce operation manager of a well-known omnichannel grocery retailer in South Africa as well as through two focus group discussions conducted with consumers who regularly purchase items online and those who have never purchased any item online. Data were analysed using thematic analysis.

Results: The findings suggested that there are four major last-mile logistical challenges facing the South African omnichannel grocery retailer considered in this study. The challenges are reliable order fulfilment, cold distribution chain requirements, physical distribution and reverse logistics.

Conclusion: The findings of this article suggest that many of the last-mile challenges experienced by the omnichannel grocery retailer stem from the inefficient management of information (data) along the supply chain. To alleviate the last-mile logistical challenges identified in this article, emphasis should be placed on implementing a fully integrated information sharing system.