Crowdsourcing becoming a solution in logistics, other industries
There is a saying that goes “many hands make like work” and that is becoming increasingly true in a growing number of industries, including logistics.
Our owner and founder, Steve Jones, participated in the Customized Logistics and Delivery Association (CLDA) annual meeting earlier this month and one of the key discussions throughout the event was about crowdsourcing, especially when talking about how to solve the burgeoning truck driver shortage in an efficient way.
This article from Investopedia describes crowdsourcing well.
“Crowdsourcing involves obtaining work, information or opinions from a large group of people who submit their data via the Internet, social media and smartphone apps. People involved in crowdsourcing sometimes work as paid freelancers, while others perform small tasks on a voluntary basis,” the article reads. “Crowdsourcing … lets businesses tap into a vast array of skills and expertise without incurring the normal overhead costs of in-house employees. Crowdsourcing usually involves taking a large job, something that requires hundreds or thousands of individual tasks, and breaking it into many smaller jobs that a crowd of people can work on separately.”
Crowdsourcing in logistics can include everything from places like Uber using technology to match drivers with people needing a ride, to using technology to match the last mile delivery needs of various companies to available providers.
Crowdsourcing in logistics
A growing number of logistics companies are utilizing crowdsourcing as they turn their driver workforce into independent contractors instead of employees. This measure usually saves the company money while providing much greater flexibility and freedom for the worker. We at On Time Logistics have used independent contract couriers since our inception in 2007 and are using independent contractors more and more for peak last mile delivery times.
The holiday season is of course when we see an enormous uptick in the demand for quality last mile delivery service. But also keep in mind that July is when Amazon hosts its Prime Week with special deals throughout the entire week. We will be needing more drivers during that week as well and using contract couriers is a perfect solution. It provides temporary workers for the logistics company and it provides an opportunity with someone who already has a full-time job to earn extra money on the side.
We aren’t alone. Many logistics companies across the country have plenty of trucks and they have the technology, but they lack skilled drivers to make the deliveries. Amazon, which is moving into more logistics work as the e-commerce giant continues to grow, is offering employees a $10,000 bonus to quit their jobs with the company and become independent contractors to help make deliveries.
Both Amazon and Walmart are in a continual race to get purchases to the customer faster and even offer same-day delivery in some markets. Last year, Walmart started using the crowdsourcing model to get independent contractors to staff its pilot grocery delivery program.
Crowdsourcing moving forward
Like anything in life and business, there are pros and cons. The advantages of crowdsourcing lie mostly in the efficiencies but there are challenges as well. Such challenges can include the time and cost of bringing new contract drivers on board and the perceived lower reliability of contract labor. We work to make our contract couriers feel a part of our company culture and include them in our quarterly team meetings if they want to participate. This helps them feel included and also helps them stay abreast of the latest company rules and happenings.
We look forward to new developments along the supply chain that utilizes crowdsourcing effectively. We already see sharing warehouse space and would not be surprised to see an increase in shared vehicle fleet usage and management.
As a company, we have been using a variation of the crowdsourcing model for more than a decade. Our skilled drivers and independent contractors are able to get your items, be it a medical sample or a sofa, to its destination on time and in good condition. Let us know how we can help!