Traditionally, the delivery of parcels is performed by a person/agent who is hired by a company on a contract basis or a regular employee. However, the concept of Crowd logistics or Crowdshipping is outsourcing delivery to a large & undefined group of people in the form of freelancing. For example, a person can make a delivery on his way to his office and back home. A person can work on his way to his own work and earn some remuneration in return. The delivery company can also benefit from increased efficiency.
Business model
A person will place an order online via his phone or laptop on a crowd logistics delivery platform. Now, all the freelancers who are available at that time will bid on the application. The first one who accepts the order will be assigned for the task. He will be the delivery person for this specific order. This person will have to pick the package from the specified retail shop and then make the delivery on the registered address of the consumer. Once the delivery is made, the freelancer will be paid via his digital wallet.
Advantages of Crowd Logistic Concept
- Less number of permanent hires leading to reduced financial costs
- Increased efficiency
Concerns of Crowd Logistic
- Less control on the interaction between freelancer and customer
- Higher uncertainties regarding the accuracy of delivery
- Legal conflicts over managing a huge fleet of freelancer
Crowd logistics concept is expected to boost and facilitate hyperlocal services.
