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.

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.

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:

Alternative Delivery Methods

• Crowdsourced Delivery Fleets
• Autonomous Deliveries
• Lockers and Pickup Points
• Drop-off Locations and Shared Space