To stay competitive in 2023, progressive ecommerce companies are heavily investing in delivery, particularly in the complex realm of ‘last mile’, with the rise of Delivery Management Platforms (DMPs). These platforms can facilitate new and developing omnichannel business models and can rapidly adapt to increasing delivery volumes, while optimizing for cost and margin.
If retailers are still evaluating last mile delivery options or whether or not to start integrating a DMP, the first question to address is whether to create a customized, in-house solution that caters to the specific needs of the organization, or to connect to an existing SaaS DMP that adheres to industry standards and seamlessly integrates with all core financial, inventory, and ecommerce systems.
It’s the old adage of build vs buy.
The consequences of this crucial strategic choice are significant, particularly as providing a strong delivery experience to customers can impact various aspects of a business, such as management, dispatch, drivers, partners, shippers, and consumers.
Arming oneself with the right data to make an informed decision is no simple task. There are numerous factors to consider, from implementation time and supply chain integration, to fleet management and maintenance costs. Below we break down (and weigh up) the most important factors:
|Implementation time:||Building a DMP in-house will need to factor in design, coding and implementation that requires months or years of development time and budgetary commitments that could divert resources and delay other projects. As retailers need to concentrate on their core business, they surely need to consider this hefty time allocation carefully.||A pre-built SaaS solution has the advantage of being operational in a significantly shorter time frame and includes responsibility for future iterations, software updates and maintenance. This enables quick scalability and expansion of delivery operations as required.Some companies are also offering scaled-back versions of their DMP to help onboard quickly and offer expansion of functionality as the maturity of use grows.|
|Technical expertise:||Building a DMP in-house will require many diverse core competencies to develop an end-to-end delivery platform. This may prove challenging for in-house teams and third party developers who are not experts when it comes to delivery management.||Purchasing a solution from a vendor that specializes in retail delivery management platforms means benefiting from technology that has been tested and approved by a team that understands the challenges retailers face and offers multiple solutions based on industry data and use cases.|
|Upgrade and maintenance costs:||An in-house solution requires software maintenance which needs ongoing resources that can drain departmental budgets and offer limited incentives for upgrades and new features.||Leading SaaS platforms include regular upgrades, new features, and maintenance as part of their licensing fee.|
As organizations seek to reduce costs and stay competitive in today’s challenging climate, more companies, regardless of their size, are moving away from custom and costly in-house development and towards SaaS oriented DMPs. While a strong internal software development team and the resources to hire third-party experts may make in-house development seem like the best solution for some organizations, the trend is on the decline. Today’s leading DMPs offer end-to-end visibility, integration with existing systems, and seamless communication between in-house teams, external fleets, and consumers.
By leveraging AI-based decision making, extended delivery networks, route optimization, and real-time updates, SaaS DMPs are helping organizations stay ahead of the curve. With these platforms becoming must-haves for the industry, it’s clear that this trend is here to stay.
Learn more about Bringg’s Delivery management app on Salesforce.