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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.
About the Author
Michael A. Robinson is a 35-year Silicon Valley veteran and one of the top technology financial analysts working today. He regularly delivers winning trade recommendations to the Members of his monthly tech investing newsletter, Nova-X Report, and small-cap tech service, Radical Technology Profits. In the past two years alone, his subscribers have seen over 100 double- and triple-digit gains from his recommendations.
As a consultant, senior adviser, and board member for Silicon Valley venture capital firms, Michael enjoys privileged access to pioneering CEOs and high-profile industry insiders. In fact, he was one of five people involved in early meetings for the $160 billion "cloud" computing phenomenon. And he was there as Lee Iacocca and Roger Smith, the CEOs of Chrysler and GM, led the robotics revolution that saved the U.S. automotive industry.
In addition to being a regular guest and panelist on CNBC and Fox Business Network, Michael is also a Pulitzer Prize-nominated writer and reporter. His first book, "Overdrawn: The Bailout of American Savings" warned people about the coming financial collapse - years before "bailout" became a household word.
You can follow Michael's tech insight and product updates for free with his Strategic Tech Investor newsletter.