Descartes continues to look for ways to improve the entire logistics supply chain, including the ever-important final mile. On Thursday, the company announced the acquisition of Foxtrot, a provider of machine learning-based routing solutions.
“Descartes has been a leader in using advanced technology to extend its world-class route planning and execution solutions for more than 20 years,” said Ken Wood, executive vice president of product management at Descartes. “Advances in artificial intelligence and machine learning are making it possible for us to leverage increasing amounts of ‘real-world data’ to better inform our route planning and execution solutions.
“By combining with Foxtrot, we’re adding a team with deep domain expertise and proven technology that will help accelerate our efforts in this area.”
Descartes paid approximately $4 million for the San Francisco-based Foxtrot.
Foxtrot’s technology utilizes millions of data points collected from vehicles on roadways and applies machine learning technology to look for more efficient routing to reduce last-mile delivery costs.
“Foxtrot enhances our recent investment in GreenMile, as both companies have extensive experience in the retail food and beverage distribution vertical,” said Edward J Ryan, Descartes CEO. “We also see an immediate opportunity to leverage Foxtrot’s capabilities across our wider route planning and execution solution suite.”
Earlier this month, Descartes’ Johannes Panzer, head of industry solutions for e-commerce, explained the importance of the final mile to Modern Shipper.
“Three out of four consumers had a negative delivery experience in the past three months,” Panzer, said. “Obviously, there is still something wrong in the market. This is a no-go for merchants because customer acquisition costs have never been as high as they are these days. The merchants are investing a ton of money in acquiring the customer, but on the fulfillment side they are failing.”
Descartes (NASDAQ: DSGX) released a report on fulfillment in the beginning of the month. Is Retailer Fulfillment and Delivery Performance Keeping Up with Sales Growth found several themes that have been permeating the consumer side of e-commerce, but none bigger than convenience, and that includes the ability of merchants to deliver.
The survey found that 23% of consumers did not order from a retailer again after a poor delivery experience, with 21% citing a loss in trust as a result and 16% saying they passed along their negative experience to families and friends.