Five Ways to Streamline Last Mile Logistics

Omni-channel e-commerce has stretched delivery and logistics to their maximum capabilities. Customers have become accustomed to having their packages arrive same day or, worst case, next day.

Unlike the past when it was normal for packages to take a couple of days to reach their destination, today’s logistic partners are finding creative ways to achieve maximum delivery in the shortest time spans possible.

Although they are successful in bringing consignments to transportation hubs through supply chain networks, distributing individual orders from those hubs to customer doorsteps is still a challenge. Difficulties such as a lack of delivery personnel, physical infrastructure and adequate security measures to protect the packages from forces of nature all add to the challenge.

With last mile delivery gaining momentum with every passing day, supply chain networks and logistic businesses are feeling the pressure to streamline their last mile deliveries for cost-efficiency and maximum order fulfillment.

Here are five ideas businesses can adopt today to streamline last mile logistics for tomorrow:

1. Leverage Technology for Delivery Optimization

Geo-navigation, mobility and even drones have made it easier to deliver packages to customer homes. McKinsey is envisioning a future where autonomous vehicles and drones will account for 80% of all deliveries.

Technologies like GPS-based navigation help delivery personnel drive hands-free yet stay on track to reach their destinations without stopping to ask for directions.

Mobility has made it easier for customers to track their package delivery progress on a real-time basis. Push notifications and offline SMS also help create a real-time connection between customers and delivery personnel.

Logistic giants like UPS dug deeper into their navigational data and realized left turns were costing them more gas and increased wait times at traffic signals. More efficient routing strategies have helped minimize the left turns, resulting in gas and time savings.

The Bottom Line: Leverage technology to optimize your last mile deliveries. It will come back with benefits in the form of better customer service, cost-savings in fuel expenses and shorter delivery spans.

2. Plan Ahead for Seasonal Demands

According to Deloitte insights, during the holiday season in 2017, an average shopper will purchase at least 15 gifts. Holiday seasons see a sudden spike in online shopping, which trickles down to more deliveries to be completed on the same day. The increased demands require pre-season planning to ensure adequate levels of manpower, delivery vehicles and also sub-outlets to store consignments from transportation hubs.

E-retailers like Amazon recruit last mile carriers ahead of peak season to keep up the delivery pace and order fulfillment rate even. A large population of temporary workers also jumps in as last mile deliverers.

Solutions like temporary workers and on-demand last mile delivery services can help you meet your seasonal demand with ease.

3. Incentivize Scheduled Deliveries

Like customers demanding their orders to be delivered on specific schedules, e-retailers can also schedule their deliveries if customers’ consent to it. Retailers can integrate options that will allow customers to choose specific schedules for deliveries. Such scheduled deliveries help plan for bulk transportation and last mile deliveries easily.

In return for the flexibility offered by customers, the retailer can offer incentives like cash back offers, promo codes, additional discount, free shipping and so on. Scheduled deliveries help in being certain about delivery routes and modes of transportation.

4. Analyze Historical Information

“Data, data, data. I cannot make bricks without clay.” Sherlock Holmes gets it right about data. You need to have data to draw patterns. In last mile deliveries, data about past deliveries, routes, customer locations, etc. help in spotting opportunities for improvement.

To cite some examples:

  1. A particular time during the day when customers prefer taking deliveries
  2. A particular route might have experienced lesser traffic bottlenecks than rest of the region
  3. Bike delivery personnel might be faster than truck deliveries in a specific route

These kinds of insights can be drawn only if data is archived and analyzed. For last mile deliveries, it can make a world of a difference. The idea is to plan and execute last mile deliveries around the customer and the best cost-effective route as shown by data.

5. Build-in Buffer Time for Contingencies

Diversions. Weather tantrums. Vehicle breakdowns. Expect the worst to happen even on perfect days – but don’t let these factors slow down the delivery schedule. It must move fluidly so that customers get their packages on time.

Setting aside some buffer time for these contingencies helps stay on track for the last mile delivery. Even if delays are happening, customers can be easily notified of the estimated delay in delivery.

Last Words

Last mile delivery consumes approximately 28% of the total delivery cost. In addition to being the last leg of the delivery, it is also the most challenging part of the entire delivery process. With the explosive growth of omni-channel e-commerce, last mile delivery has become a make-or-break opportunity for retailers. Employ these techniques and maximize your last mile delivery efficiency.

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