By 2027, the United States will manufacture 12 million metric tonnes of milk (26 pounds). This will be greater than what the US domestic market will consume. – McKinsey & Company report, 2019
Since the start of the COVID-19 outbreak, chaos has ensued in the milk supply chain. But the pandemic has also created a renewed interest in doorstep milk delivery services.
Redefining Hyperlocal Milk Deliveries
Milk deliveries started during the 1700s in the United States. Back then, there were no refrigeration facilities. A fresh milk bottle was delivered at the doorstep every morning.
World War II changed the face of milk home delivery. Refrigeration and pasteurization technologies increased the shelf life of milk products. This change resulted in the growth of supermarkets and the increasing use of plastic for storing milk, thereby making milk buying simple.
Similarly, the Coronavirus pandemic has thrown the spotlight back on milk deliveries. With stores battling milk shortage, there is a rising demand for doorstep milk deliveries. Philadelphia, for example, has experienced a boom in hyperlocal milk deliveries since June 2020.
What is dairy logistics / milk run logistics?
Dairy logistics involves moving dairy products like milk, cheese, and so on to destinations without degrading its quality. The ultimate goal of milk products logistics is to come up with a process that can deliver these limited shelf life products seamlessly.
Challenges in the Milk Delivery Sector
Milk delivery companies face numerous challenges in their logistics. These challenges extend across all stages of the product journey.
Time is the most crucial factor for successful milk deliveries.. Milk goes through different stages—collection, testing, and processing— before it reaches customers. Delays in delivery can cripple the supply chain and affect customer experience.
Distance is also a crucial component of milk deliveries. Milk must be delivered over a fixed distance within the desired time frame. The inability to cover the distance within a prescribed time can increase costs and result in spoilage.
Vehicle capacity is another critical challenge for milk deliveries. Delivery vehicles for milk should have the necessary equipment to keep it safe and fresh for consumption.
Milk is highly sensitive to temperature. Hence firms should leverage cold-chain logistics all the way from collection points to selling at retail stores.
Dynamic On-ground Conditions
Milk is sourced from dairy farms, tested for various properties, processed, and finally sent for delivery. Even a small change across the logistics chain could lead to delay and in turn, a negative customer experience and loss of revenue.
Increasing Transportation Costs
Milk produced per cow in pounds increased from about 17,763 in 1999 to 23,396 in 2019. – US Department of Agriculture.
The rise in demand and increased production of milk has also increased transportation costs.
The increased transportation costs result from:
- Storage costs
- High driver costs
- Fuel used
- Hours spent in deliveries
- Distance traveled
Cutting the transportation cost is the ultimate aim for all companies in this space.
How can technology facilitate efficient farm fresh milk home delivery services?
Route Optimization: From milk collection to milk retailing
Milk collection is the first step where logistics is involved in milk delivery. Route optimization software helps milk delivery companies create an efficient allocation schedule for forecasted and ad-hoc orders. It enables them to plan efficient routes and vehicle fleet mix for collection of orders based on demand. Also, it automates vehicle allocation based on its capacity and driver skill sets.
Route planning software also comes in handy when milk is delivered to retail outlets. There may be a sudden increase in demand for milk in some outlets, and some outlets will demand less milk. A dynamic route planning software quickly accommodates even last-minute changes. It reduces the time taken for deliveries and also the distance traveled thereby minimizing cost and delivery workload for drivers.
On-ground notifications and alerts
Real-time tracking is necessary for milk delivery not only from a delivery perspective but also to minimize damage.
Real-time tracking software helps milk run logistics companies obtain real-time feedback on loading, unloading time, waiting time, etc, that can help them manage and optimize their logistics.
Whether it is milk deliveries to doorstep or milk deliveries to retail outlets, SaaS-based logistics technology is the need of the hour. Efficiency and visibility are critical to ensure seamless deliveries. Route planning software from Locus enables Milk Delivery Services companies attain higher efficiency by reducing the distance traveled, improving flexibility, and providing visibility.
Locus’ real-time tracking software tracks the routes traveled, driver performance, delivery delays, waiting time, etc. Its on-ground insights help milk run logistics companies rectify errors and maximize efficiency.