Randall Castillo Ortega offers insight into how COVID-19 is changing logistics, and how the pandemic might improve the activity
Talking about logistics in this “new normal” implies doing it from the perspective of a different consumer, because not only have their thoughts changed, but also their buying and living habits. The current situation has made the consumer more demanding, careful and selective, since he or she decides what to buy, when and through the means considered safest. RACO Investment is a Central American company specializing in international business and business investments in Costa Rica and Panama, and its founder, Randall Castillo Ortega, provides insight into how COVID-19 is changing the logistics landscape in the region.
Online shopping has increased during the health contingency, since the customer does not have to move, but waits, from the place of confinement, the most essential food and merchandise. In 2019, 155.5 million people in Latin America bought goods and services online, which represents a large increase compared to the 126.8 million consumers who did so in 2016. In addition, retail sales through e-commerce reached $64.4 billion, according to figures from the Statista consultancy.
In post-Covid-19 disruptive times, the most important thing is the survival of the human being with the necessary inputs and tools to get ahead. In this context, logistics is, and will continue to be, key in the shipment of food, medicine and other essential goods, through traditional means of transport (road, air, port or rail), or in its most modern forms (autonomous vehicles, drones or robots).
Says Castillo, “Experts from the KPMG accounting consultancy forecast that the digital channels of certain brands, particularly those in the food and beverage industry, will continue to register a massive increase in volume, so they warn that companies without a digital presence or with insufficient focus customer-centric will be left behind.” To face this new reality, the use of smart lockers to deliver products, drones and autonomous vehicles represents a very important alternative for safe, fast and efficient delivery.
The transition is already in full force. For example, in countries such as China, reportedly the epicenter of the pandemic, companies have already equipped drones for medical use, using infrared cameras to test temperature measurements, while the health worker can remain at a “healthy distance.” This might not stop the coronavirus, or other health issues, but it can definitely help prevent them from becoming global problems that impact everyone in so many different ways.
For its part, Lok, a firm that designs, manufactures and operates smart lockers, foresees that by 2030 the circulation of these vehicles will increase 36% in the 100 most important cities in the world. Additionally, in China, several vendors have already accelerated the adoption of autonomous vehicles for contactless delivery by distributing groceries and medical supplies. Mobility will be one of the big issues on the public policy agenda of any nation that seeks to boost its economy through electronic commerce.
Logistics, through apps specifically for the transport of parcels and goods, will be the perfect tool to get orders to the end-user in less time and at low cost. Adds Castillo, “This will drive the use of delivery services such as Rappi, Uber Flash, and Cornershop, as well as sustainable motorcycles, scooters, bicycles, and vehicles.”
Despite COVID-19, and possibly because of it, the future of logistics is very promising. There are no limits to provide the individual with their favorite object or merchandise to meet their needs. We hope not to live in a bubble that isolates us for a few years to avoid any type of virus or bacteria. What is a fact is that logistics will make the world move and will always be on our side. How it looks in the future, however, will most likely be much different than what is currently seen.