RESEARCH & DEVELOPMENT UNIT · WHITEPAPER
Integrating consumer-driven logistics into a third-party delivery platform
By Federick Joe P. Fajardo and Nino Paquito O. Pedida. Drafted July 2021; redacted public edition signed January 2022.
ABSTRACT
The challenges brought forth by the COVID-19 pandemic have led to a surge in consumer-driven logistics — defined as an increased capacity for consumers to choose and/or demand when, how, and where their desired products are purchased and delivered (Postnord et al., 2021).
Since pandemic regulations accelerated the shift to digitalization, traditional businesses have faced detrimental effects. This led to them being forced to integrate consumer-driven logistics — establishing or joining e-commerce platforms, and offering online transactions and door-to-door delivery services to stay afloat (Schneider, 2020).
In this paper the authors present a strategically designed IT architectural and operational plan serving two purposes: to allow aspiring business owners to understand how to start, operate, sustain and expand a third-party delivery platform; and to enlighten investors about the technological and operational processes involved in the business’ background and its potential for growth.
THE MARKET
Why the timing mattered
Accelerated by pandemic regulations, the food delivery industry alone moved sharply — and in the Philippines, Grab remains the top third-party food delivery platform (Voon, 2021).
Growth in the food delivery industry, 2019 to 2020
Estimated Gross Merchandise Value
Of Southeast Asian food-delivery GMV contributed by Grab
E-commerce platforms have existed in the Philippines since the early 2000s — Sulit.com.ph and TipidPC among them — but were not as successful as present-day companies offering the same services. Given the limitations of internet, website and application design across 2000–2010, those earlier services lacked consumer-driven logistics: few options for delivery or payment, and little room for consumer preference, convenience or safety.
WHAT CONSUMER-DRIVEN MEANS
Six things that give the consumer the choice
Postnord et al. set out the logistics that ensure a consumer’s freedom of choice, comprehension and precision during an online transaction — and consequently their engagement.
Simplify and clarify the delivery options
The consumer should not have to decode what they are choosing between.
Offer options: precision, speed and budget
Different orders are urgent, cheap or exact — rarely all three.
Offer the option to choose the delivery location
Where it arrives is part of the choice, not an assumption.
Enable communication and transparency during delivery
Visibility while the order is in motion, not only at dispatch and arrival.
Allow the delivery to be easily adjusted
Plans change after an order is placed; the platform should absorb that.
Create smart return solutions
The return path deserves the same design attention as the outbound one.
OVERALL STRUCTURE
Two primary divisions
The overall structure of a successful third-party delivery platform simplifies into two.
01 — IT Operations
The architecture and the platform itself: the systems, services and security zoning that keep orders, riders and merchants moving.
02 — Business Operations
READ THE PAPER
Redacted public edition
Redaction notice
The original manuscript contains twelve (12) pages. This is a controlled document, redacted to protect the interest of our solution design, research and development.
- Revision 20210730 — draft released.
- Revision 20220117 — redacted, public edition, digitally signed.
- If you would like a similar solution for your own business, get in touch and we will scope it.