Image credits: Markus Spiske, Unsplash
News Article

Logistics, Key Challenge for Same-Day Deliveries

By Andrea Villar | Mon, 07/27/2020 - 12:28

E-commerce depends on the coordination and speed of various areas in a company. One of them is logistics, which is key to boosting this sector in Mexico. However, to make e-commerce logistics run smoothly, more than extra costs are needed to ensure faster shipments. Distribution centers remain key to manage deliveries efficiently.

“Same-day delivery is a little-explored market niche that looks promising for the near future. Today, there is really no same-day delivery in Mexico and those big companies that offer it charge very high prices,” said in an interview with Mexico Business News (MBN) Iñaqui de la Peña, Country Manager of Dostavista, a delivery startup company currently looking to develop a same-day delivery product and a 36-hour delivery at 40 percent of today's courier cost in Mexico.

According to the 2018 Logistics Performance Index prepared by the World Bank, Mexico ranks third in logistics performance in Latin America. Worldwide, the country ranks 51st. 

Some of the companies that had problems in their supply chain during the Hot Sale were Liverpool, Sanborns and Claroshop. According to Tech-Check, a platform that allows users to compare prices online, during those days, the company received more than 1,200 complaints from users about their online shopping experience at those stores. Almost 50 percent of the complaints were against Liverpool, 40 percent against Claroshop and 10 percent against Sanborns. One of the main mistakes is that companies offer products that they no longer have in stock, explained the platform.

But other companies are reinforcing this area. Last week, Mercado Libre said it will invest US$27 million in the construction of a distribution center in the state of Jalisco in Mexico to accelerate deliveries in the country's central region. The warehouse will have 60,000m2 and half will be in operations by November, said in a press conference Javier Dolcet, Head of Operations of Mercado Libre in Mexico. In February, the Argentina-based company said it will invest US$420 million this year in Mexico, its fastest-growing market, up 46 percent from 2019.

“Stock and storage represent 43 percent of the already sold products in Mexico. Our logistics operation allows companies of all sizes to participate in the platform as we take care of the packing and distribution,” said to MBN David Geisen, Country Manager of Mercado Libre.

In July last year, Amazon opened its third distribution center in Tepotzotlan, Mexico, which has more than 100,000m2 and is the largest in Latin America. The company led by Jeff Bezos has two other distribution centers in Cuautitlan Izcalli.

Andrea Villar Andrea Villar Journalist and Industry Analyst