Why Are Shippers Interested In Last Mile Logistics?

Retail Business Review | Friday, March 04, 2022

Last-mile logistics allow shippers to get more products to consumers faster and cost-effectively, both serious concerns in the e-commerce & omni-channel supply chain.

FREMONT, CA: Last-mile logistics are among the most misunderstood parts of transportation networks. The last mile may not appear very important, but it can make up 28% of a shipment’s total cost. Also, growth in e-commerce is radicalizing how shippers view last-mile logistics.

To comprehend the wide-ranging benefits and main concerns inherent in last-mile logistics, your organization must understand what constitutes last-mile logistics and its disputes. How it affects e-commerce and omnichannel supply chains, why it is changing, and how new technology enhances it.

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What Is Last Mile Logistics?

Last-mile logistics refers to the final step of the delivery process from a distribution centre or facility to the end user. Although the name indicates it, it is the final mile of delivery, but actual last mile delivery can extend from a few blocks to 50 or 100 miles. Most regularly, last-mile logistics involves using parcel or small package carriers to deliver products to consumers.

Last Mile Logistics Are Important to Modern E-Commerce and Omnichannel Supply Chains

Last-mile logistics allow shippers to get more products to consumers faster and cost-effectively, both critical concerns in the e-commerce and omnichannel supply chain. Consumers are ready to pay premiums for better last-mile delivery services, such as same-day or instant delivery.

Last Mile Comes With Unique Challenges

There are growing pains in last-mile logistics. Urban delivery may be hard with navigating traffic and parking regulations, and global delivery disputes may dramatically increase last-mile logistic costs.

Challenge in last-mile delivery goes back to complexity. Large products may need assembly and skilled unpacking upon delivery, so shippers must rethink how to ensure the final product accurately reflects what was sold. While hundreds of last-mile carriers exist, not all offer assembly options, which might be categorized as an added service.

 Other products may need specialized installation by skilled technicians. Still, more bulky items are moving from traditional retail to consumer direct shipping models, and consumers want speed and visibility in every stage.

Capacity reflects another problem in last-mile delivery. Previous blogs have touched on the interest and fears surrounding the capacity crunch and the driver shortage, and these issues are not going away. To remain competitive, shippers must find ways to overcome these challenges and meet the new challenges in last-mile delivery.

Some practicable ways to beat these challenges include the following:

 • Delivery lockers could maintain products for consumers to pick up at set locations.

 • Drones and robots can aid in delivery too, but they are not quite ready for prime time.

 • Better route optimization technologies can also help decrease woes over last-mile capacity while cutting last-mile costs.

 • Shippers may also provide better incentives to truckers looking for career opportunities and positions with minimum regulations and rules.

Modern Shipping TMS Must Handle Last-Mile Delivery Too

The visibility key lies in asset and shipment tracking. New transportation management systems (TMS) must manage the increased level of services and frequency found in last-mile delivery as e-commerce grows. A modern TMS can help shippers manage last-mile delivery through automated asset tracking and alerts to both shippers and consumers. This betters visibility from end to end and decreases risk.

Existing Companies and Startups Search to Take a Marketshare, So Shippers Must Act

Last-mile logistics continue to dominate costs for shippers, and more startups are looking for ways to take advantage of this often-underappreciated marketplace. Shippers must ensure their companies continue to thrive as more consumers demand better, faster service in last-mile logistics.

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