Delivering milk to customers is a big cost for farmers. It’s relatively straightforward to drive from the farm into the city with a trailer full of milk tanks. The expensive part is getting it to all the individual customers within the city.
In the logistics industry, they call this the “last mile delivery” problem. That last mile to the customer’s door makes up 53% of the total delivery cost. It just takes up a lot of time.
Drivers get stuck in traffic, they wait at lights and struggle to find a suitable parking spot to load and unload the milk.
I’ve always thought cargo bikes are a great way to transport milk around a city.
David Trought, is the engineer behind our milk dispensers and milk processing technology.
He is also a big cargo bike fan and he spent the last month building an electric cargo bike in his workshop!
So I wasted no time in loading one of our milk tanks onto David’s cargo bike and asked him to take it for a test run.
It was easy to cruise at 30km/hour and I was impressed with how easy it was to ride and how well it handled.
With Christchurch’s many cycle lanes a cyclist can get around Christchurch quite quickly.
Cargo Bike Delivery Christchurch
In January 2023 we will begin selling milk in Canterbury again.
We will be testing the cargo bike system in Christchurch City.
We’ll install a long under-bench refrigerator in our workshop and convert it into our milk depot.
Our refrigerator will hold 15 to 20 milk tanks.
The tanks will be delivered from the farm and unloaded at the depot.
The empty tanks are taken back to the farm for cleaning and refilling.
From the depot, we will have a person deliver tanks to all our city customers via cargo bike.
Community Distribution Model
Fonterra has franchisees do their distribution for them.
Franchisees pay hundreds of thousands of dollars to buy a franchise license that enables them to distribute Fonterra dairy products to retailers, cafes and other outlets in a given area.
It makes sense to get other parties to help with distribution, but instead of a formal business arrangement like a franchise agreement.
We can build a distribution model similar to the one Uber uses with their taxi drivers and food delivery drivers.
The Happy Cow Milk app coordinates members of the public who have access to our milk depot with customers who need milk.
It gives people another option for an extra source of income and it also makes it easier for farmers to distribute their milk.