Lazada's Last Mile: Where No E-Commerce Company in Vietnam Had Gone Before

Abstract

Aim/Purpose: This case study examines the last-mile logistics model as implemented by Lazada Vietnam, as well as the logistics challenges in the local business environment that led the e-commerce company to dually employ the inventory/retail model and the marketplace model for delivering orders to online customers in Vietnam in search of the way to perfect their last-mile logistics. Background: For electronic commerce companies aiming to be successful in customer service, what academics and practitioners refer to as ‘last-mile logistics’ is the one moment of truth, when deliveries have to be planned tactically and exactly, so that orders are delivered to customers at the right time, right place, right quantity, right quality, and ultimately at the right cost. When deciphering this type of supply chain, i.e., one that is e-commerce- driven, last-mile logistics is the one segment of the product flow that directly interacts with the ultimate customer, but many times is the one segment that is the most problematic and less efficient to implement well. Lazada Group, a German e-commerce company, discovered the serious complications of ‘last-mile logistics’ when they first entered Vietnam in 2013. Methodology: This case study used qualitative method through interviews with Lazada Vietnam’s management. Contribution: The paper explains the challenges incorporating last-mile logistics concept in e-commerce operation in Vietnam.