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The concept of last mile delivery does not refer to the literal last mile of a product’s transportation, but the final leg of its journey from transportation hub to a customer’s doorstep. Fleet and supply chain managers focus on last mile logistics because it often proves the most costly and time-consuming segment of a product’s journey.
Managing last mile delivery has led to creation of logistics solutions, such as automated dispatch and route optimization, that can make last mile delivery more efficient. That’s important, as last mile delivery can make up as much as a third or more of the total product shipping costs.
The Challenges of Last Mile Delivery
Last mile logistics have become an area of focus for businesses because of the costs and complexities involved. The goal of last mile delivery is to get the item to customers in the quickest way possible.
The last mile delivery also represents the last point of contact between a company and the customer. If a delivery is bad for some reason – taken to the wrong house or damaged – it can result in a customer that will never order from a company again.
Companies are searching for ways to make that moment the best possible. But no matter the final destination for a package, the last mile presents challenges.
For example, deliveries in rural areas could mean that each delivery point is separated by several miles, with only a few items getting dropped at each stop. Cities and suburbs also present challenges. While delivery points are closer together, high traffic volume leads can lead to delays as long (or longer) than those in rural areas.
Competition has made the issue even harder to solve. Because consumers have gotten used to getting free shipping and having parcels delivered quickly, they have a high expectation for getting products fast. And, with free shipping, companies must shoulder the cost.
Software Helps Solve Last Mile Delivery Problems
More companies have turned to sophisticated software that support efficiencies in fleet management, including last mile delivery. The best of these systems involves last mile logistics solutions that include the following.
Route Optimization. Route optimization is a constantly moving target. Software can monitor the situation in any location and offer route suggestions that make it easier for dispatchers and drivers to find the fastest, safest route in real-time.
Real Time ETAs. This serves drivers, dispatchers and customers. By tracking the current location of a driver and their estimated time of arrival, dispatchers know exactly what the situation is in terms of estimated time of delivery arrivals. This also allows companies to give accurate information to consumers about when products will arrive.
Reports. The best systems track, collect, maintain and analyze data, offering a variety of reports that can help fleet managers understand the current metrics of their operation, including detailed logs of all deliveries. These technological advances have supported companies in developing more effective and efficient last mile delivery systems, the most important segment in the transportation of goods from a company warehouse to a customer’s door.