The Benefits of Hybrid Delivery Orchestration

Introduction

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When setting up the local delivery for their business, business owners mostly face two options: relying on their own fleet or outsourcing to third-party providers. In-house delivery allows businesses to have full control over the process and quality of the delivery but it also makes it challenging to scale and meet the fluctuating demand (e.g. during peak periods). On the other hand, outsourcing to third-party providers limits the control of the process and might cause poor quality of service.

Hybrid delivery orchestration has emerged as a game-changing strategy that optimizes local delivery operations by combining in-house resources and external partners. By embracing hybrid delivery in a proper way, businesses can access the best side of each approach and achieve a higher level of efficiency and customer satisfaction.

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This article explores the concept of hybrid delivery orchestration, its manifold benefits for businesses, the challenges it poses, and the pivotal role of technology in making it a success.

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What is Hybrid Delivery Orchestration?

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Hybrid delivery orchestration is a delivery management approach that combines multiple resources to optimize delivery operations. It includes leveraging in-house drivers, third-party couriers, various types of vehicles, and specialized services. By seamlessly integrating these resources, businesses can optimize their delivery process, enhance customer satisfaction, and drive operational efficiency.

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In-house vs third-party couriers

The most common hybrid delivery orchestration combines internal and external drivers. Internal fleets consist of drivers (employees or freelancers) who work directly for/with the business, giving the logistics team full control over the process. Internal drivers are normally preferred for delivering high-value items or for deliveries with a particular process (e.g. “Cash On Delivery”). 

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Third-party couriers mean relying on external delivery providers to top up the capacity, cover broader areas, and access more vehicles. External fleets can include companies like Lalamove, pickupp, Grab Express, or pandago, and independent local courier companies. Third-party couriers allow businesses to have an almost unlimited pool of drivers, vehicles, and specialized services (e.g. cold-chain delivery), giving them margin to fulfill large volumes of orders while also staying flexible.

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How Hybrid Delivery Orchestration Benefits Businesses

1. Enhanced Efficiency and Flexibility: The primary advantage of hybrid delivery orchestration is the ability to adapt swiftly to varying demands and challenges. Businesses can dynamically allocate delivery tasks to the most suitable resources, depending on distance, time constraints, and package size. Businesses can cover any variation in demand while keeping the flexibility of a lean fleet.

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2. Expanded Delivery Coverage: Hybrid delivery orchestration allows businesses to expand their delivery reach, even in more remote or challenging locations. By collaborating with external partners or deploying specialized vehicles, companies can cater to customers in previously inaccessible areas. This extended coverage can be a significant competitive advantage, attracting new customers and increasing market share.

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3. Cost Optimization: Managing delivery operations can be a costly endeavor, especially for businesses dealing with fluctuating demands. Hybrid delivery orchestration optimizes costs by leveraging cost-effective resources for specific deliveries. This approach enables businesses to reduce operational expenses while maintaining service quality, resulting in a more sustainable and profitable delivery model.

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4. Better Customer Experience: The access to specialized delivery services and a broad pool of drivers, allows brands to quickly adapt to the most important customers. Whether it’s same-day delivery, exact delivery windows, or cold-chain delivery, businesses can accommodate the demands of their customers.

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5. Scalability and Seasonal Adaptability: Many businesses experience fluctuations in demand due to seasonal variations or promotional events. Hybrid delivery orchestration facilitates seamless scalability, as organizations can quickly ramp up delivery resources during peak periods and scale down during slower times. This adaptability ensures that businesses can handle sudden surges in demand without compromising delivery performance.

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Challenges of Hybrid Delivery Orchestration:

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Despite the numerous benefits, implementing hybrid delivery orchestration can be challenging for businesses. Some of the key obstacles include:

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1. Operational Complexity: Integrating multiple delivery resources and managing diverse logistics partners can create operational complexities. In particular, teams might struggle with identifying the best provider (internal or external) based on delivery location, vehicle availability, or service level requirements. Once the order is dispatched, monitoring all the deliveries on multiple platforms can also be time-consuming and lead to errors.

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2. Finding the right third-party delivery partner: The main challenge of relying on external delivery partners is due to their low reliability. Finding the right partner is often a trial and error process and sometimes relying on only one provider is not possible or not cost-effective. 

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3. Route Optimization and delivery planning: Last-mile delivery accounts for 53% of the total cost of the supply chain, so it is key for businesses to optimize their processes to avoid any cost-inefficiency. Route optimization and planning are among the main tools to reduce delivery costs, but it can be even more difficult in the case of hybrid delivery orchestration due to the increase in delivery options.

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These challenges highlight the importance for the logistics team to properly plan their hybrid orchestration and find the right technology partner.

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How Technology Powers Hybrid Delivery Orchestration

Technology plays a key role in driving the success of hybrid delivery orchestration and overcoming the challenges listed above. Local delivery orchestration platforms like Kosmo allow businesses to easily manage their hybrid delivery operations in one place.

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These platforms can integrate multiple delivery APIs and act as central dispatching hubs for the teams. These platforms also unlock automation capabilities to increase efficiency and reduce the errors of the team.

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Powering Hybrid Delivery Orchestration with Kosmo

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Kosmo is an efficient solution to optimize hybrid delivery management and simplify the work of logistics teams. Kosmo allows businesses to aggregate in one platform both their internal fleet and external couriers like Lalamove, Borzo, and others, create optimized routes, automate dispatching, and track all deliveries in real-time

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Let’s see how Kosmo enables hybrid delivery:

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Seamless In-House Drivers Experience

Kosmo provides your in-house fleet with an intuitive mobile app where drivers will be notified of new orders, will see the delivery instructions, and will use to capture the proof of delivery and update the delivery status. A seamless driver app is a key factor for an efficient fleet, allowing the team to have real-time visibility on all deliveries.

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Automation and Cost Optimization

As businesses move towards adopting hybrid delivery orchestration, more delivery options and combinations will be unlocked, making automation a necessary step for local businesses.

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Exceptional Customer Experience

Kosmo’s in-house notifications allow teams to keep customers constantly informed on the delivery status, reducing the calls to customer support and increasing the success rate.

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I hope this article helped you to gain a better understanding of hybrid delivery orchestration! If you want to learn more on how you can boost your hybrid delivery, reach out to sales@komos.delivery or visit our website kosmo.delivery.

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