The Milkman Was Ahead of His Time

As recently as 1980, 89 per cent of all milk consumed by British households was delivered by a milkman.

Expansion of supermarket chains has all but made this job extinct, but looking back, we can see that the milkman was way ahead of his time, and not just because he used an electric vehicle.

So how does this offer insight into today’s supply chain issues, and what can we learn from the past?

Amazon and the rise of e-commerce

Milkmen offered a daily order form that could be left on the doorstep and fulfilled the next day. The modern interpretation might be e-commerce

According to IMRG Capgemini eRetail Sales Index, e-commerce in the UK was worth £133bn in 2016. They predict the industry will grow another 14% in 2017. In this space, Amazon continues to go from strength to strength—innovating and dominating at breakneck pace.

Amazon’s UK services (warehouse and logistics) employ more than 15,000 people with more to follow. New warehouses are being commissioned that will take their count to 15 across the UK.

Multi-channel retailers are also seeking to expand their share of the e-commerce market. Sainsbury’s acquisition of Argos points to a strategy where e-commerce capabilities are an essential component.

Boohoo, ASOS and AO are all pure play Etailers originating in the UK with aspirations for international growth and are taking steps to make that a reality through a combination of buying existing businesses or simply entering new territory organically.

It would seem the rise of e-commerce continues and is gaining strength. Is this a bad thing?

Reverberations down the supply chain

The electric milk float was an iconic source of delivery. It was the trusted option for delivering of variety of goods and represented a ‘personal touch’ to delivery service but it was often a frustration to other road users as it clogged local arteries.

Click & Collect options have improved the experience of consumers and reduced the volume of parcels going to couriers.

DPD recently announced their UK trading results, which show more success with sales of £806.1m and pre-tax profits £130.9m—a company well placed to capitalise on the growing e-commerce market.

The corollary of this must be more parcels on the move from multiple despatch points across the UK to literally millions of homes—delivered by traditional couriers like DPD and lifestyle couriers who use their own vehicles to make the same deliveries.

Couriers of all denomination are disconnected and largely unregulated. The rise of e-commerce has the potential to increase the numbers of vehicles on the road unless couriers find a way to combine—and here is where the 21st century milkman finds new meaning and relevance.

Lessons from the milkman

Larger, tied couriers may be handing over consignments at a merging point to smaller, more localised providers who could then go on to make the final drop on behalf of multiple couriers—think of a Formula 1 driver emblazoned with various sponsors on the overall: that may be the image of the 21st century equivalent of the milkman.

The milkman was a known quantity, trusted, and he understood what could be left where and with whom.

And to think, he was killed off because bricks and mortar retailers became a better priced more convenient option for the modern family—how things change.