18 May 2021

How are last mile distributors adapting and innovating in response to COVID-19?

Product innovation and advances in technology have brought a plethora of household goods to market which contribute to achieving the Sustainable Development Goals. Life-changing products such as solar lights, water filters and cleaner cookstoves have a vital role to play in alleviating poverty, but can often be out of reach for the communities who need them most.

This is because customers on low-incomes or who live in remote areas, or both, are often not sufficiently reached by private sector businesses. This is particularly the case in developing economies, where limited infrastructure brings additional challenges, particularly in remote areas.

A range of businesses – called ‘last mile distributors’ – work to deliver these essential products to communities without access, helping to ensure that everyone has the opportunity to benefit from them. These businesses also play a critical role in generating employment opportunities in regions and markets where economic opportunities are scarce.

The COVID-19 pandemic has presented last mile distributors with significant challenges including supply chain disruption, shifts in consumer demand, increased credit risk and reduced ability to engage in-person with customers, agents, retailers and staff.

Recognising these issues, we’ve been working to support last mile distributors within our portfolio and the wider sector to adapt and innovate in response to the pandemic. Through our technical assistance facility, CDC Plus, we partnered with the Global Distributors Collective to provide advice and support peer-learning between last mile distributors, helping to improve their resilience and accelerate their recovery from the crisis.

Working with 23 businesses in our portfolio and other last mile distribution companies who are members of the Global Distributors Collective, we conducted interviews to identify the ongoing challenges and innovations within the sector, as well as suggest solutions to explore. We have published our findings in a new report, How is the last mile distribution sector adapting and innovating following COVID-19? . Our findings focus on four key themes which emerged during the study: smart use of working capital, digitising customer relations, remote team field management and building partnerships for growth. We hope the insights from this report will help the sector respond effectively to the COVID crisis, encourage innovation, and ensure that their impact on hard-to-reach communities can be sustained and scaled.

Read the full report and an Executive Summary on the Global Distributors Collective’s website: Research and insights | The Global Distributors Collective

 

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