Buy vs Build: How to Get the Best of Both Worlds From Your Last Mile

Today’s customers have raised the bar for their expectations, prioritizing aspects like expanded delivery options, convenient product pickups, improved payment terms, and sustainable product delivery. Even B2B companies are navigating this shift to enhance delivery efficiency and sustainability.

This heightened emphasis on customer experience sets the stage as we prepare for logistics and supply chain planning in 2024.

The pivotal question arises: Should businesses construct their last-mile solution or acquire it from a tech partner? Join us in this week’s InFocus webinar as we explore this vital decision with KB Nagaraju, supply chain expert and Strategic Advisor at Locus and Mehul Kapadia, Chief Revenue Officer, Locus. Here, we distill the key insights.

Get ahead with the insights you missed. Watch now!

1. Pace of Innovation

Enterprises must decide how innovation aligns with their logistics strategy. Building an in-house tech stack grants control, but buying from a tech partner can accelerate innovation. Scaling logistics requires process efficiency, which hinges on innovation. Large organizations, often bogged down by complex roadmaps, may benefit from purchasing solutions to maintain innovation pace. However, they may choose to build in-house for a competitive edge.

Read Also: Buying vs. Building Logistics Software: How to Choose?

2. Balance of Experience and Expertise

The choice between building and buying also hinges on the balance of experience and expertise. Established enterprises with stable IT platforms might lean towards building their solutions for easier integration and change management. In contrast, newer companies seeking faster market entry might opt for building if their solution offers a unique customer value proposition.

Read Also: Unlock Infinite Possibilities in your Supply Chain with AI

3. Maintenance and tech debt

Building legacy systems offers stability but introduces maintenance costs and tech debt, particularly during growth phases. As in-house logistics capabilities expand, the emergence of redundant tech decisions can render the solution inflexible, posing challenges for decision-makers like CEOs, CIOs, and CTOs. While some large organizations choose to restructure in-house functions into microservices after six years, others, prioritizing their brand and manufacturing, opt for tech partners to oversee end-to-end product management, tapping into their IT expertise for efficient operations.

Read Also: How to leverage human productivity to improve SLA adherence?

4. Opportunity cost and competitive resilience

Every enterprise faces the question of where to allocate resources, people, assets, and budgets. Companies with established systems may struggle to adapt to changing compliance regulations and market demands. In such cases, buying agile, cloud-based logistics solutions can be a wise choice, as tech partners can offer expertise in compliance and rapid adaptation.

Read Also: Unit Economics in the Last Mile: An Ultimate Guide

5. Time to value

The ultimate question in the build vs. buy decision revolves around time to value. How quickly can a business realize returns on its investment? Larger companies may face pressure to get products to market faster and justify spending with high return on investments, making adoption of cutting edge technology the most logical choice.

Read Also: Time To Value And Its Importance For the Last Mile

Build vs. Buy: A Decision that Varies for Every Company

The choice between building and buying an all mile logistics solution is unique to each company, shaped by its nature, objectives, and market dynamics. Some prefer the control of building, while others opt for buying to achieve scalability, adaptability, speed, and value. Key factors like change management, opportunity cost, and tech debt influence this pivotal decision.

Read Also: SMB vs Enterprise Grade Logistics Solution – Which One’s Right for You?

Locus: Tech Platform that is Scalable and Customizable

When it comes to selecting the right solution provider for purchase, Locus stands out. Locus is a real-world-ready customer experience and dispatch management platform that has effectively supported over 200 businesses across various industries and geographies, solving logistics challenges cost-effectively. With a streamlined four-step integration process, Locus accelerates time to value and offers scalability to meet diverse business needs, including route optimization, real-time tracking, carrier selection, contract management, time slot management, and insights and analytics.

Still need more clarity on build vs buy? Schedule a demo with our experts!