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When we talk about the "last mile" in technology, we're usually discussing that final stretch of cable, wire, or air that connects a cable firm, Internet provider, or satellite company with its customers.
This final leg – for instance, the cable that runs from a telephone pole to your set-top box – is a well-known "bottleneck" and a stiff expense for service providers.
The nearly $2 trillion-dollar global e-commerce business is even more dependent on that last-mile delivery, particularly massive outfits like Alibaba and Amazon.
They can build expensive, elegant global supply and logistics chains and track inventory with the latest bleeding-edge technology. They can know what customers want before they know they want it.
But if they can't get that physical package into customers' hands… it's all been for nothing.
These companies are shelling out top dollar for help in tackling this difficult problem…
The Perilous, Expensive Path to Your Front Door
The last-mile problem is one of the most complicated dilemmas in business today.
Just like in telecom, the e-commerce last mile requires countless individual connections – every package needs to be carried by an individual worker and hand-delivered to its final destination.
That physical nature of the last-mile process makes it one of the most costly, inefficient, and uncertain parts of the e-commerce business.
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In fact, SupplyChain magazine reports that as much as 28% of the total cost of delivery is incurred over that last mile.
That's because the vans that deliver – let's face it – just about everything imaginable to folks' front doors and mailboxes can't carry as much "stuff" as the global armada of planes, container ships, trains, and tractor-trailers that move that same stuff from factories to those fulfillment warehouses.
No matter how you play it, the last-mile connections are going to be more costly.
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About the Author
Michael A. Robinson is one of the top financial analysts working today. His book "Overdrawn: The Bailout of American Savings" was a prescient look at the anatomy of the nation's S&L crisis, long before the word "bailout" became part of our daily lexicon. He's a Pulitzer Prize-nominated writer and reporter, lauded by the Columbia Journalism Review for his aggressive style. His 30-year track record as a leading tech analyst has garnered him rave reviews, too. Today he is the editor of the monthly tech investing newsletter Nova-X Report as well as Radical Technology Profits, where he covers truly radical technologies – ones that have the power to sweep across the globe and change the very fabric of our lives – and profit opportunities they give rise to. He also explores "what's next" in the tech investing world at Strategic Tech Investor.