Warehome Seeks to Disrupt Last-Mile Logistics

Mexican startup Warehome has developed a collaborative model towards last-mile deliveries for e-commerce, reports T21. The startup’s original business model focused on supply and demand for real estate in small urban spaces but since the pandemic started, it shifted to the development of micro-distribution centers.

The growth of e-commerce has led companies to look for new locations to provide fast last-mile delivery services. Logistic spaces are usually located in the periphery of cities. Mercado Libre and Amazon, for example, invested in large logistic hubs in the State of Mexico. But last-mile services need to be located in strategic spaces closer to the final consumer, so companies are looking for availability right in the heart of cities. The trend is noticeable even in the densely packed Mexico City, with companies looking for spaces of at least 8,000m2 or 10,000m2 close to the main road or avenues like Periferico, Viaducto or Circuito Interior, explained Francisco Muñoz, Senior Vice President of Logistics at CBRE Mexico, to T21.

“When a huge company has sales through e-commerce, it faces big challenges. Although it has warehouses available, these are usually on the outskirts of cities. This complicates logistics because if this company wants to make same-day deliveries, it has to connect with different players in the city,” said Iván Ariza, CEO of Cargamos, in an interview with MBN.

Location is what made Warehome’s model so adaptable as any person or homeowner with free room in their house can register in the app and offer that space to new customers, which are mostly SMEs that want to be closer to their online consumers. This allows SMEs to make faster deliveries without large investments in space to do this at a larger scale. “The building does not have to be too tall because it is not a place where the merchandise will stay for long periods of time, what you want are fast transactions from your master distribution center, so everything can be done in less than 24 hours,” added Muñoz according to T21.

Same-day deliveries are slowly becoming the norm in e-commerce as consumers expect faster and better solutions. “Users used to have eight to 10-day delivery expectations but new players in the market are changing the rules by offering same-day deliveries,” said Ariza.