Last-mile delivery! Sounds like something to do with miles and delivery? Don’t let the terms deceive you. Although the latter part may be true, it has absolutely nothing to do with miles. Last-mile delivery is the final step in the long and tedious supply chain process, where goods are transported from a local distribution center, warehouse, or retail store to the final destination—that is the customer’s doorstep.
Why Has Last-Mile Delivery Been a Concern to Logistics Businesses?
How a last-mile delivery is handled directly impacts customer satisfaction, mainly because this is the stage where customers often have the most visibility, and so their expectations are comparatively higher. They of course want their packages to arrive as soon as possible, in good and pristine condition, and for sure at a convenient time. Any delays or issues that might likely occur during last-mile delivery can directly result in dissatisfaction, complaints, and potentially lost customers, which is definitely not the road any logistics business would be willing to take. This is the primary reason why many companies invest heavily in optimizing their last-mile logistics processes.
Apart from all this, last-mile delivery plays a huge role in the profitability and operational efficiency of logistics companies. Since it entails more localized deliveries, having to deal with multiple short trips can be costly, consuming plenty of fuel, labor, and time. This can be cost-increasing, particularly when working with fluctuating customer demands. Companies are always on the lookout for means to cut down these expenses, both through a range of means, such as maximizing routes, adopting electric or autonomous vehicles, or even collaborating with third-party logistics companies to cover specific aspects of delivery. All these aspects contribute to the reason why last-mile delivery becomes a matter of great concern to the logistics companies.
Types of Last-Mile Delivery Models
- Direct-to-Consumer Delivery: It is the most prevalent model, where products are delivered directly from a store or warehouse to the consumer’s doorstep.
- Click-and-Collect: Through this model, customers place their orders online and collect their purchases at a collection point, which can be either a store or a locker.
- Crowdsourced Delivery: Other companies employ crowdsourced delivery fleets, by which independent contractors or gig workers make deliveries. This lowers the cost and speeds up delivery, especially for small packages.
- Parcel Lockers: Rather than having deliveries made to a residential address, customers can collect their packages from self-service lockers at convenient places such as supermarkets or shopping centers.
Challenges in Last-Mile Delivery
- Urban Congestion & Traffic Delays: Traffic is the villain, especially in the congested roads, where delivery vehicles could gettrapped, which could result in longer delivery time and maximum fuel use. In urban areas with limited road infrastructure and high vehicle concentration, it is even harder to make deliveries on time.
- Restricted Access to Remote Delivery Points: Delivery to remote or rural areas can be a laborious task, but an even more laborious task is to navigate through poor roads and unknown terrain. Needless to say, inadequate infrastructure means more fuel and more delivery costs. Fewer courier companies serve these locations; thus, deliveries become costly and less frequent.
- Seasonal Demand Fluctuations: During peak seasons, such as the holidays or major sales events, delivery systems may be swamped with orders, and this unexpected surge in orders can cause backlogs and delays in deliveries. Accommodating these demands would be even harder with the lack of staff or additional delivery vehicles and can strain the system with an increasing expense.
- Lack of Real-Time Visibility: Without real-time tracking in place, customers can end up being perplexed or worried about when their shipment will reach them, which can be infuriating to at least some. Drivers can also lack current knowledge of traffic or changes in the delivery schedule, which can result in errors and delays. Businesses also struggle to anticipate delays and make adjustments to their delivery schedules accordingly.
- Outdated Technology: Most delivery organizations continue to use traditional paper-based route planning, which delays processes by enormous degrees. Aging software can also cause communication issues between departments, drivers, and customers. Without updated systems, businesses are unable to track shipments easily, resulting in delayed deliveries and ineffective customer service.
- High Costs of Delivery: Last-mile delivery is the most costly portion of shipping, at times contributing as much as 40% of all logistics expenses. Labor, fuel, and vehicle upkeep are the largest expenses. Congestion and inefficiency in traffic only make matters worse. Shipping small packages to dispersed locations also increases the cost per delivery, particularly in urban areas where the delivery density is low.
Technological Solutions for Improving Last-Mile Delivery
More Effective Technologies
- Artificial intelligence has the capability of predicting and planning mapping in a way that it can steer clear of traffic and choose better delivery routes.
- Machine learning algorithms also predict demand, and based on real-time data, companies can reschedule delivery.
- IoT sensors can assist in real-time tracking of shipments and inventory and offer better visibility of the inventory.
- Coordination between warehouses, drivers, and customers thus can be improved with the integration of an ERP or a mobile application.
Optimizing Delivery Networks
- Last-mile delivery can be achieved effectively by adopting a network of micro-warehouses near cities.
- Warehouses placed strategically can cut down delivery times by having products near customers.
- Geographic Information Systems (GIS) can also be used for determining the optimal delivery routes, making delivery shorter.
Investment in Route Optimization
- Thanks to real-time weather information, traffic flows, and roadblock updates, drivers can be re-directed during transit to bypass delays.
- GPS data coupled with AI guarantees discovery of the shortest and fastest route to delivery points. This not only makes delivery faster but also reduces fuel consumption.
Smart Warehousing
- Warehouse management systems (WMS) optimize space and reduce the cost of storage, rendering warehouses more efficient.
- The integration of WMS with supply chain management software optimizes inventory management, which will enable businesses to obtain a much clearer view of stock levels, thereby reducing the risk of stockouts or delays.
Real-Time Tracking and Visibility
- Advanced tracking software allows customers to receive updates on the delivery status of their shipments, and this increased visibility allows companies to predict delays and reroute drivers if necessary.
- Further, through the integration of tracking systems with mobile apps, customers can be given real-time updates with ease.
How to Keep Your Customers Satisfied Amidst Challenges
Here are a few quick tips to your customers satified and happy all the while you figure out more advanced technology to do so:
| Real-Time Status Updates | Flexible Delivery Scheduling | Customer Support & Communication |
|---|---|---|
| Offer real-time tracking via apps or emails. | Offer multiple delivery windows throughout the day. | Provide clear and easy-to-reach customer support channels. |
| Notify customers of potential delays or issues before they arise. | Provide a “choose your time” option. | Offer a customer service chat feature. |
| Send automatic alerts when the delivery is nearby. | Reschedule capabilities for missed deliveries. | Provide immediate responses and resolutions to complaints. |
Alternative Delivery Methods
- Crowdsourced Delivery Fleets
- Autonomous Deliveries
- Lockers and Pickup Points
- Drop-off Locations and Shared Space
Final Thoughts
Last-mile delivery has always proven to be challenging for logistics companies due to its complexity and the associated high cost. This is the last leg of the supply chain, wherein the products are moved from a distribution facility to the customer’s doorstep. The challenges arise from multiple causes, such as unpredictable traffic, urban congestion, and increased demand for quick deliveries. With increasing competition within the logistics market, companies are constantly challenged to deliver better last-mile solutions.
Moreover, last-mile delivery tracking is now a business priority for those providing cargo to India and cargo to the UK, as clients want to be informed about their deliveries. Companies that offer cargo services must remain ahead of the curve in this regard, particularly those that offer cargo services in Dubai. Dealing with the best cargo company in Dubai can be a deciding factor in enhancing last-mile delivery efficiency and customer satisfaction in order to remain strong in the market.
FAQ
- How to enhance the last-mile experience by addressing last-mile issues?
Apply route optimization and real-time monitoring to enhance efficiency, coupled with variable delivery timing and sophisticated technologies such as drones or crowdsourced fleets.
- What are the challenges in the last-mile delivery service?
Traffic congestion, bad infrastructure, inexact delivery times, and seasonal demand spikes make it challenging and affect customer satisfaction.
- Why is last-mile delivery challenging in cargo service?
It is subject to unpredictable factors such as traffic, weather, and increasing costs, and is the most costly component of logistics, with high customer expectations.
- Is the last-mile delivery business profitable in cargo service?
Although profitable, last-mile delivery is costly, but route optimization and new technology can increase profitability.
- How does tracking for last-mile delivery enhance cargo to India and cargo to UK?
Last-mile delivery tracking offers real-time information for shipments, making it more transparent and eliminating delays whether shipping cargo to India or cargo to UK.
