Consumer Demand Drives Logistics Opportunity

Amazon announced a few days ago they will now deliver packages to the trunk of your car. Taking on Uber/Lyft model from the financial perspective as:

1. It shifts the upfront capital expenditure to acquire logistical assets to the existing assets in the whole marketplace (in this case, the everyday cars). VCs has blog a lot about strategic benefits on where you can all your bigger cost burden of operation.
2. It allows (the highlighted terms from below) or more specifically aligns supply of products more closely (physically and metaphorically that is) with demand. Physically in that customers can access products within a walking proximity and metaphorically, as logistics companies and Amazon have to be on par with their extrapolation of customer demand within a given cluster or zip code coverage. It will probably start off with products with relatively short shelf-life or consumer

[below is a snapshot from one of my previous posts]

The outed-founder of Uber just started a $300M+ fund (who sold his Uber equity for a projected $1.4B cash) just did a $150M capital infusion to a startup (to pretty much take over it). The goal is to reposition unproductive real estate assets, potentially as a strategy to control the first stage of the future of product/service supply chain.

US consumers’s demand for product and service went from a few days to 24 hours to 12 hours to now, you can get a product within 2 hours. VCs/markets call this the growing demand for “the last mile” delivery. With that being said, infrastructure and real estate will act as the crucial to facilitate the distribution of these 2-hour delivery window. Traditional versus incoming/new flow of goods from manufacturer/service provider to consumers:

Traditional 
Manufacturer/Service Provider <> Warehouse <> Regional Delivery Hubs <> Local Delivery Hubs

Potentially New Delivery Model
Manufacturer/Service Provider <> Warehouse + Delivery Hub (makes black sigma planning even more challenging to fulfill shorter demand cycle).

**In fact if you study Amazon’s latest patent filings (patent pending ones), they are trying to move the manufacturing stage into their warehouse. Studying patents of these corporations can help drive where you ca n place your strategic bets as a VC or capital investors for the next 5-10 years.