Delivery as a Service (DaaS) Definition and Benefits - ChicagoShipper

Many DTC businesses provide excellent items and have innovative ideas to disrupt their respective markets. However, they frequently fall short of offering great delivery experiences, especially with the transition to multichannel e-commerce. Fortunately, logistics technologies like delivery as a service (DaaS) are changing this and assisting e-commerce enterprises in transforming their client experience. 

Delivery as a Service (DaaS) Definition 

Delivery as a service (DaaS) is a service-oriented logistics business model that allows companies to obtain on-demand deliveries without having to hire and maintain their own fleet. DaaS is a customer-centric strategy that leverages technological solutions and transportation efficiency to provide speedy and cheap delivery experiences. 

DaaS companies that employ virtual fleet technology to link businesses with available delivery experts such as local truck and van owners can be found. To fulfill local deliveries, several service providers employ their own fleet of drivers. Furthermore, third-party logistics (3PL) firms provide full services that include delivery as a service. 

The Increasing Demand For Delivery As a Service 

The relevance of DaaS is expanding in tandem with the growing demand to enhance delivery management. Ecommerce behemoths such as Amazon have altered consumer expectations by providing quick deliveries, often as early as the same day. Consumers now demand the same from smaller firms, with 61 percent of respondents in a NielsenIQ poll requesting that their goods be delivered as soon as possible. 

Over a two-year period, the number of customers who would wait two or more days for their orders has also decreased. While the figure remained at 64% in 2019, it is expected to fall to 55% by 2021. Despite this, rapid shipping is frequently prohibitively expensive for businesses unless they are ready to submit to Amazon. As a result, delivery as a service has become a feasible (and frequently required) choice for firms that cannot afford to develop their logistics on their own. 

With a rise in demand for local deliveries, delivery as a service makes sense in addition to e-commerce. Local delivery demands are increasing, especially as individuals remain at home more due to COVID-19. 

According to eMarketer, 51.3 percent of the US population will buy groceries online, requiring the usage of local delivery services. Meanwhile, American customers order takeout or delivery frequently, with 60% doing so at least once a week. Another area where delivery as a service might address the need for local delivery services is in the transportation sector. 

As a result, it is not surprising that the courier and local delivery markets have grown significantly in recent years. The market was valued at $126 billion in 2021, with continuous growth due to the epidemic. 

What Services Do Delivery As A Service Companies Provide? 

Many delivery-related issues that organizations confront are alleviated by delivery as service providers, particularly in terms of logistics and cost management. 

  • On-Demand Delivery 

On-demand delivery has become a requirement rather than a choice in a world where customers increasingly crave ease. Customers pick when and where they want their items delivered via on-demand delivery. This frequently entails providing things as soon as feasible in order to fulfill client expectations. 

Because there are so many moving components, on-demand delivery can be difficult for many businesses, particularly startups and small stores. Finding the proper shipping partners, negotiating costs, choosing and packaging items, organizing routes, and coordinating delivery are all usual responsibilities. 

In certain circumstances, firms may have their own fleet of cars to make deliveries rather than relying on a shipping partner. Some firms simply cannot afford to provide on-demand delivery due to the enormous time and financial investment required. 

Delivery as a service companies assist businesses in addressing this big difficulty by allowing them to provide on-demand delivery without the need to recruit and maintain their own fleet. The DaaS provider handles the shipping process for the company by picking up ready-to-ship items and completing last-mile delivery. 

In the case of 3PLs who provide DaaS as part of their service, the 3PL handles the full fulfillment process. This often entails (but is not limited to) selection and packaging, shipment coordination, and last-mile delivery. Some 3PLs can also assist with first-mile delivery to help simplify the supply chain process even further. 

  • Affordably Priced Entry Into Local Food Delivery Marketplaces 

Restaurants will only witness an increase in delivery orders in the age of the convenience economy. Meeting this need, however, is easier said than done. There are several moving components (for example, recruiting drivers and maintaining a fleet of delivery trucks), which might add to overhead expenses. Businesses will have to make additional adjustments, such as parking places, which adds to the annoyance – particularly for eateries in packed regions. 

DaaS suppliers assist restaurants to keep expenses down while allowing them to serve food in their communities. Restaurants may fulfill consumer demand by offering delivery as a service without incurring the costs of hiring drivers or maintaining delivery trucks. This provides companies with a cost-effective option to enter the local food delivery marketplaces without all of the added labor. 

Delivery As A Service For Internet Merchants 

While final-mile delivery may be the primary concern for organizations searching for DaaS providers, they frequently have additional fulfillment needs that must be met as well. That is why firms should search for a 3PL that can provide full fulfillment services, such as storage and inventory management, as well as returns handling.