The development of eCommerce retail has changed and continues to impact our lives. The convenience of having things and services delivered to our door is now an essential aspect of our life. Let us explore last-mile delivery in this article.
Digitalization has had an impact on many sectors of life, one of which is the tremendous transition from traditional purchasing to online shopping. Online orders, unlike traditional transactions, do not require face-to-face interaction, requiring sellers to use delivery services from transportation companies to convey products to their clients.
Fulfillment by Amazon, for example, has changed the online retail industry with spectacular same-day and next-day deliveries. Consumer expectations have grown drastically and are still rising.
In an increasingly eCommerce-driven world, getting the delivery experience right is critical for shippers and carriers. Product and price are no longer the sole factors to consider when it comes to increasing sales and delighting customers. Delivery has risen to prominence as a significant feature that people consider when determining where to buy their online items. A positive delivery experience provides a significant competitive edge.
In this article, we’ll discuss what last-mile deliveries are and give you a complete explanation of how you can optimize your process.
What Is Last Mile Delivery?
Last mile delivery, as the name implies, is the final stage of a product’s journey from the producer to its final destination, i.e., the client. This logistical cycle is divided into three stages: the first mile, the middle mile, and the last mile.
The last mile phase begins when goods are picked up from the ultimate destination warehouse (or fulfillment center) and ends with a successful delivery to the consumer. Last-mile businesses pick up the parcel, load it onto a delivery vehicle, and deliver it to the customer. The last mile delivery is the most difficult and expensive aspect of an eCommerce shipping network.
What Customers Are Looking For In The Last Mile?
1. Fast Delivery
When giving the greatest last-mile delivery solutions, this should be at the top of your list. Customers will always choose speedy delivery service, with the majority wanting same-day delivery.
So, if you can deliver the fastest and most efficient service, your services will undoubtedly be in high demand.
2. Precise Order Tracking
The information flow within the last-mile delivery process is critical, especially for consumers who want to know the status of their delivery at all times.
While standard courier services provide a general idea about where the goods are, customers prefer a more precise real-time tracker.
3. Security And Insurance
There is a significant possibility involved whenever customers place their ordered products in your hands and count on you to deliver them on time.
You’ve ahead won half the battle if you can guarantee that they’ll arrive safely. However, if you give an appealing insurance benefit in the chance that the product is mishandled, you are more likely to get your firm started.
This is why courier companies charge a fairly minimum insurance cost, with some including an assurance in their prices up to a certain amount if the products are destroyed or damaged during transportation. This type of guarantee puts your customers at ease and ultimately increases your trust rating.
4. Specialization
At the very least, your service should have one feature that sets it apart from the competition. A few additional specializations would also be beneficial.
Finally, all of these add-on services might significantly put you ahead of even the most popular conventional courier services, which currently control a large portion of the market. And, as your unique offerings gain popularity, more customers will be drawn to your services.
5. Convenience
Customers no longer have to bring their parcels to the post office to get them mailed. Ever since courier companies have established satellite operations in strategic areas to enable access.
While this is all wonderful, technology has suddenly transformed the game with apps that have taken the service to a whole new level of convenience.
Despite having all of these qualities that could assist consumers assess if you are qualified for the job, there are still several hurdles you must overcome to be a successful last-mile delivery service provider.
What Happens In The Last Mile Delivery?
Step 1: Requests and orders are routed through a centralized system.
Importance: It is the most efficient way to keep track of all goods.
Step 2: Goods show up at the transportation hub or warehouse from the manufacturing line or supplier for delivery to their end users.
Importance: The first phase of the last-mile delivery process starts here.
Step 3: Tasks are assigned to delivery employees and optimized based on routes.
Importance: This is vital for achieving a more cost-effective logistics solution.
Step 4: Items are scanned before loading onto delivery vehicles.
Importance: Tracking items reduces the risk of getting lost along the way.
Step 5: When the package reaches the end user, proof of delivery is obtained.
Importance: Records should be verifiable for deliveries that have been made.
What Kinds of Services Do Last Mile Delivery Companies Provide?
Last-mile delivery companies provide a variety of services and solutions to assist eCommerce businesses in running their operations efficiently. Let’s explore some of the most popular services:
Dynamic Routing
Last-mile delivery businesses’ operations are greatly influenced by route optimization. Efficient routing saves logistics costs, shortens delivery times, and maintains eCommerce businesses competitive by achieving customer satisfaction and delighted clients.
Last-mile delivery startups may route and re-route on the fly using the latest technology-led dynamic routing systems, delivering a high level of efficiency.
Automated Dispatches
As a logical continuation of the previous point, adopting automated last-mile delivery software ( Tookan, Shipsy ) allows last-mile delivery firms to plan, evaluate, and monitor deliveries through a fully automated system.
This enhances resource usage (e.g., fewer drivers, shorter vehicle idle times), evaluates and resolves inefficiencies, and lowers shipping costs. As a result, the procedure is considerably more visible and streamlined.
Deliver Visibility
Last-mile delivery businesses use modern GPS-enabled last-mile software, which gives fleet management total visibility of the end-to-end delivery process. This achieves complete transparency and enables fleet managers to monitor, course correct, handle emergencies, remain flexible, and exert control over the entire logistical operation.
Electronic Proof Of Delivery
ePOD eliminates the time-consuming and labor-intensive processes of the past, when signatures, paperwork, lost receipts, and forgotten documents (among other things) were a daily battle!
Last-mile delivery organizations can use ePOD to gather, store, analyze, and retrieve data and documentation as needed. Audit activities, data sharing, and transaction speeds are also significantly improved.
Crowdsourcing
Customers like the ease of home delivery. However, with the rising rise of eCommerce retail as a business model, logistics companies are finding it challenging to stay up. For example, the amount of delivery persons and cars needed to meet market demand is frequently unsustainable.
As a result, India’s last-mile delivery providers have turned to crowdsource to strengthen their operations. These cutting-edge platforms connect travelers with clients that require parcel delivery in the same area.
Last-mile delivery entrepreneurs are continually launching new services and monitoring trends. Some include
Ever-Faster deliveries
We are already experiencing 10-minute grocery and 2-hour deliveries, in addition to same-day and 24-hour deliveries.
Micro-Fulfillment Centers
Smaller satellite warehouses and micro-fulfillment centers strategically placed across a complex geographical network give greater coverage, lower prices, and faster deliveries.
Autonomous Vehicles
Drones and autonomous automobiles, for example, are increasingly being tried in logistics and transportation. Food, medications, and small technological devices are among the things provided by these cutting-edge vehicles.
Last-Mile Delivery Challenges That May Impact Your Business
Last-mile carriers typically work to convey goods from an intermediate shipping center to the ultimate destination. Numerous things might go wrong during this time that will influence your brand and total earnings. Some of the primary challenges that firms may face in last-mile delivery are as follows:
Returns Of Orders And The Rising Cost Of Logistics
While purchase cancellations are widespread in e-commerce, one of the most common causes of consumer returns is due to errors in the last mile of delivery. Delayed deliveries, inability to trace items effectively, delivery of damaged goods, and order misplacing can all result in higher returns.
The majority of these catastrophes are caused by the 3PL partner’s incompetence or a lack of technological capability to avert these situations. Order returns raise your logistics costs even more. They also have an impact on your market share and client loyalty.
Return To Origin
Another big challenge that sellers encounter is this. When an order cannot be delivered to the customer, it is simply returned to the seller. This can occur owing to incorrect addresses in the order, or when the consumer is not present/denies accepting the transaction, among other things. Such events may need additional re-shipping charges.
Inability to meet rising demand in Tier 2 and 3 cities
E-commerce demand in India’s tier 2 and 3 cities is fast increasing as internet availability improves. In this situation, last-mile distribution offers its own set of obstacles. Your 3PL partner’s fulfillment facility may be located a long distance away from the delivery point.
The interconnectedness between them can have an impact on delivery times. Flipkart and Amazon are attempting to address this issue by collaborating with local business owners and establishing pickup stations where customers can pick up their items. Remote places are significantly more challenging to manage.
Not Meeting Customer Expectations
Customers tend to demand the same standards set by e-commerce giants like Amazon elsewhere. They demand quick deliveries and may be unconcerned about the issues that can occur in the final mile. For example, severe weather or a local lockdown can cause delays in delivery. Customers also want long-lasting deliveries.
They want more flexibility and lower expenses, such as Amazon Prime’s free delivery. This level of service is nearly hard to achieve without optimizing the supply chain in the last mile.
Best Last Mile Delivery Companies/Startups For E-commerce In 2022
WareIQ
It is a category-defining, best-in-class full-stack eCommerce fulfillment tech platform (with built-in inventory planning, order fulfillment, and shipping system) for modern firms looking to increase online sales, revenue growth, and profits with same/next-day delivery.
- It helps in generating bulk shipping labels & invoices for users in a few clicks.
- It also sends auto-alerts to clients about the status of shipments through WhatsApp, SMS, and Email.
- It also provides shipping cost information for various shipping partners based on:
- Base Weight, Additional Weight Offset
- COD Charges
- COD%
- They integrate with all National and Regional shipping partners like Blue Dart, DTDC, Ecom Express, Ekart logistics, and amazon shipping.
FedEx
It is a leading shipping and logistics giant that offers cold-chain services, makes shipment for rush orders and services, transport dangerous items ( electronic parts and lithium batteries ), last-mile delivery, warehouse, and inventory management.
Amazon
Amazon is an eCommerce company and also one of the last-mile delivery companies. Amazon is the leading challenger to established players because of its sheer scale, continuous consumer focus, and constant innovation (e.g., FedEx, UPS).
Amazon Prime offers features such as 2-day free shipping, same-day delivery, and guaranteed 1-2 hour free deliveries via Prime Now.
Hitch
Hitch is an online delivery platform that relies on crowdsourcing as its major business model, allowing shipping businesses to collaborate with travelers to transport products to distant destinations.
It is one of the most promising last-mile delivery startups, and one of its fundamental claims is that it seeks to challenge the shipping sector by using unconventional techniques to transport cargo from warehouses to its final destination.
Final Takeaway
Hopefully, this article should have given you a better understanding of last-mile delivery, as well as the challenges it can have on your business.
It is critical to maintain a pleasing customer base by delivering packages on schedule and to the correct address (being able to track packages can help too). By streamlining your process, you can also reduce unsuccessful deliveries, cut distance, and increase the scalability of your business.
In 2022, mastering last-mile delivery will be essential for any online store or delivery service.
FAQ
What is Last-mile delivery and why is it important?
The last mile is usually the most expensive part of the supply chain, accounting for 53% of total shipping expenses. The last mile is similarly uncertain, with delivery locations and timelines uncertain until a customer makes an order.
What are first-mile and last-mile delivery?
Simply said, first-mile delivery is the beginning of the supply chain’s distribution section, whereas last-mile delivery is at the finish. The goods is delivered to a carrier via a courier from the manufacturer. When the order is delivered, the last-mile operation finishes.
Which is an example of the Last-mile?
the final stage of a procedure, notably for a buyer purchasing goods: One big issue with shopping online is “the last mile” – delivery to the customer’s home.
Why is Last-mile delivery so expensive?
Much time is spent on the roads. Last-mile delivery drivers navigate metropolitan streets and spend more time idle, resulting in higher maintenance and fuel costs. Furthermore, drivers may be required to travel at reduced speeds, which affects overall fuel efficiency.
What is the Last-mile and why it is challenging?
The last mile issue results from the fact that, while customers expect free and quick deliveries, the last mile is also the most costly and time-consuming portion of the supply chain process, accounting for up to 53% of overall shipping costs.
