Every year, logistics and delivery companies move 25 Billion parcels globally using air, land and sea transport. The most difficult and crucial part for businesses is the ‘last mile’.Here, we discuss the importance of last mile delivery, why the last mile is challenging, ways to enhance it, and what lies ahead for this crucial part of the delivery process.
What is Last Mile delivery?
Last leg delivery is also known as “Final mile”. This type of delivery involves taking goods from a transport hub to their final destination, often a customer’s home.
The last mile of delivery is particularly challenging for several reasons. While vast transportation networks efficiently move billions of parcels worldwide using dedicated routes and specialized vehicles across long distances, the final part of the journey from a local hub to a customer’s home or office is much less controlled and consistent.
Local delivery drivers face unpredictable challenges like traffic, road closures and weather. Unlike long-distance logistics, they make frequent stops to deliver individual parcels, which is less efficient. In e-commerce, these drivers are the main connection between delivery companies and the customer.
Last Mile Delivery Tracking
Last mile delivery tracking is crucial in today’s logistics, providing customers with real-time updates on their packages to build trust and satisfaction.
It improves efficiently through optimized routes and timely adjustments based on traffic and other conditions, benefiting businesses with better inventory management and operational insights.
Despite challenges such as communication issues and technological glitches, advancements in GPS, mobile apps, and IoT enhance tracking accuracy. Investing in these technologies is essential for companies aiming to streamline operations, cut costs, and meet rising consumer expectations in the competitive logistics industry.
Challenges/Problems in Last Mile Delivery
Alongside its advantages, last-leg delivery also presents challenges that require attention and resolution to improve operations. Here are a few of them.
- High Costs
Last-mile delivery, though the shortest part of the delivery process, is the most expensive. Setting up new infrastructure to handle increased demand can be costly. Unexpected expenses like delays or order cancellations can further add to costs, which might deter customers if passed on.
- Delays
Late deliveries and missing deadlines are costly issues. While global shipping delays are more predictable, last-made delivery requires careful route planning and real-time communication to avoid delays that can lead to failed orders.
- Unforeseen Issues
It’s challenging to prepare for unpredictable events. Industries typically set aside contingency funds to manage unforeseen complications, which can vary based on past experiences.
- Real-time Tracking
Lack of visibility is a major issue in last-mile delivery. Implementing tools for real-time communication with drivers and allowing customers to track shipments live can enhance service reliability.
- Inefficient Routes
Optimizing delivery routes is crucial for cutting operating costs and improving delivery times. Businesses inexperienced in logistics may struggle with complex factors influencing route planning.
- Outdated Technologies
Many logistics companies use outdated technology, particularly in last-mile delivery. Updating with modern solutions like GPS tracking for drivers can significantly improve efficiency.
- Reverse Logistics
Setting up efficient systems for returning goods from customers to suppliers or manufacturers known as reverse logistics is crucial. It helps companies manage returns effectively and recover value from returned products.
Future of Last Mile Delivery
The landscape of last-mile logistics is rapidly changing due to the growth of e-commerce and the demand for faster deliveries. McKinsey highlighted drones as cost-effective alternatives, emphasizing their potential for supply chain efficiency.
- Third-party logistics(3PL) providers are innovating with sustainable transport and real-time tracking technologies to address challenges like high costs and urban congestion. Trends such as AI, robotics, and micro-fulfilment centres are reshaping delivery operations, aiming for greater efficiency and customer satisfaction.
- Technologies like drones and crowd shipping are gaining popularity for optimizing routes and reducing emissions, supported by real-time tracking systems that ensure transparency and reliability in delivery processes.
How to Improve Last Mile Delivery?
Here are the 5 ways to improve last-leg delivery:
- Establish Standard Operating Procedures
Let’s have a look at Establishing standard operating procedures that improve last-leg delivery.
- Create clear guidelines for every step of last leg delivery.
- Analyze pasty delivery data to set performance benchmarks.
- Track delivery performance to find ways to improve efficiency.
- Give Customers Delivery Options
Shifting the focus to offering customers various delivery choices.
- Let customers choose delivery time to increase success rates.
- Provide flexibility to change delivery windows if needed.
- Improve satisfaction by delivering orders on time as chosen.
- Prioritize Customer Communication
Let’s prioritize customer communication.
- Keep customers informed from purchase to delivery.
- Reduce inquiries by updating customers on package status.
- Build trust with proactive communication throughout.
- Implement Effective Tracking
The things that should be considered regarding implementing effective tracking
- Use a robust tracking system to monitor shipments.
- Ensure packages are delivered promptly for customer satisfaction.
- Compare data against standards to improve logistics performance.
- Partner with Third-Party Logistics
- Collaborate with a 3PL to handle order fulfilment efficiently.
- Save on shipping costs by using regional distribution centres.
- Scale operations to meet customer demand without increasing overhead.
FAQs: The Importance and Future of Last Mile Delivery Explained
How does last mile delivery work?
Last leg delivery is the final stretch of the package’s journey, from a local distribution centre to the customer. It focuses on affordable, quick, and accurate delivery, using vehicles like vans, cars, or bikes, and sometimes local stores or lockers. Innovations like robots and drones are also being tested.
How long does last mile delivery take?
Delivery times vary based on factors like distribution centre location, traffic, and weather. Customers value both speed and reliable tracking.
How are customer demands reshaping last mile delivery?
Speed, Cost, and quality are now crucial in last-mile delivery. It’s the last touchpoint where customers interact with your brand through delivery drivers. Offering options like next day, same day, named day, and eco-friendly delivery is essential to meet customer expectations.
What challenges do last-mile delivery face?
Last-mile delivery deals with problems like traffic, high costs, navigating cities, and meeting fast delivery demands.
How does technology help last mile delivery?
Technology improves last-leg delivery by showing delivery routes, managing inventory in real-time, and making communication between drivers and customers better.
What are some new ways to do last mile delivery?
New methods include using drones, self-driving vehicles, smart lockers, and crowdshipping. These aim to make deliveries faster, cheaper, and better for the environment.
Conclusion:
In summary, understanding last mile delivery is crucial in today’s fast-moving logistics industry. By using new technology, focusing on what customers want, and making operations more efficient, businesses can meet and surpass customer expectations. As demand grows for fast and dependent deliveries, staying ahead with innovative and flexible strategies will be essential for success in the changing landscape of last-mile logistics. Qodenext provides expert supply chain solutions, including powerful OMS tools. Contact us today and let’s unlock your ecommerce potential!
