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Why the Last Mile Matters in Logistics

The growth of the e-commerce industry hasn’t slowed down since it became popular in the early 2000s. Today, the global e-commerce industry is worth more than $9 trillion.

Online shopping is more normal than visiting a storefront. And expecting same day delivery of your packages has also become the norm, for better or worse when it comes to the logistics and courier industry.

While the logistics industry is responsible for so much movement of products and materials, long before a consumer even purchases a product, the customer only sees the last mile. When a courier pulls up to their home and hops out of the van with a package in hand, that is the most important step of the logistics journey in the mind of the customer.

But why is it so important for companies to prioritize last-mile logistics? Keep reading to find out why logistics management all boils down to the final mile.

The Journey of a Parcel

What does it take for a package to make it to the consumer? It takes many hands, many steps, and many journeys before that final mile.

It all starts with the manufacturing company. They will source the raw materials to produce their products. Materials need like metal need to be mined, sent to a refinery, and turned into steel and aluminum.

Then they get shipped to a manufacturer to be turned into components. Then they get sent to other manufacturers, where various components are all compiled into a final product.

These products then get sent to the harbor or airport, as they will move around the globe to retailers and wholesalers. They’ll arrive at their country of destination, go through inspections, and then get sent again to a warehouse.

In many cases, products are sold from this warehouse direct to consumers. In other cases, this first warehouse is a wholesaler and will send the products to retailers. And from here, customers make an online purchase, products are packaged up once more, and shipped via last mile logistics companies to finally make it to the hands of the customer.

Why Is the Last Mile the Most Important Step?

The last mile is just one small part of a much larger journey. Without all the other steps that came before, the last mile wouldn’t even matter.

But the last mile is the most important. Wondering why?

Because it’s the only part of the journey that involves the customer. And the entire industry is dependent on the final purchase from customers.

If customers don’t have great experiences with their last-mile logistics providers, they buy fewer products, which trickles down through the entire industry.

So in order to keep all these companies profitable, that touch the products and materials long before the customer does, last-mile couriers need to provide the best, fastest, most efficient customer experience possible.

So it’s up to retailers to work with the best last mile delivery logistics providers, and it’s up to these providers to deliver on their promises day in and day out, even as expectations get greater and greater.

Amazon Changed the Landscape

Everyone knows about Amazon, and how they’ve changed e-commerce and the shipping industry as a whole.

In the mid-2000s, they began offering two-day shipping. As their loyal customer base grew and grew, millions of people around the US came to expect two-day shipping all the time.

These expectations have been pushed on other retailers as well. And the pressure is always on couriers like USPS and UPS to make it happen.

Of course, Amazon decided to move away from 3PL logistics by unrolling their own delivery fleet in major cities across the country. This makes it much more accessible to get packages into the hands of customers in just one or two days.

How to Handle the Last Mile

So how do companies manage their last-mile logistics and get products into their customer’s hands? They use a transportation management system.

The best and most efficient companies use advanced tools to plan routes, save time, and get more products to their destination, faster. This means using artificial intelligence to learn about routing and continually scan and optimize routes, to ensure the fewest miles are driven and the fewest turns are made to optimize the last mile.

AI is always at work and always striving to improve the last mile experience, as demand for faster packages increases each day, and as more and more packages enter the system.

The Future of the Last Mile

The last mile is a huge industry in and of itself. That’s why we are seeing a ton of innovation and a ton of futuristic startups entering the space.

Eventually, this country won’t be dependent on USPS or UPS for final delivery. Instead, we’ll have robots and self-driving cars handling the bulk of this process.

And while that sounds far off in the distant future, it’s already happening.

Nuro is the self-driving parcel delivery car that is already making household deliveries for companies like Wal-Mart, Chipotle Dominos, and FedEx.

These delivery robots are small, nimble, and safe, unlike giant delivery trucks. And since no one is inside, the priority is always the safety and preservation of those outside the vehicle, and never of the vehicle itself.

This means it will gladly sustain damage to itself to protect those around it, which isn’t going to be the case with the driver of a traditional delivery van.

While Nuro delivery vehicles are designed to operate on roads, smaller robots are in the works from companies like Starship to create small, light sidewalk bots.

With more deliveries taking place off the road, that means less traffic and congestion in our busy cities.

Don’t be surprised when you finally see a delivery robot for yourself.

Don’t Get Comfortable

The e-commerce industry is constantly evolving. With the ongoing pandemic, the constant shipping of products, food, groceries, and more puts an ever-increasing demand on the last mile of logistics.

The industry can’t slow down, and constant innovation is required. The most important thing you can do is to never get comfortable with your current logistics setup, as you need to adapt regularly to stay competitive.

Looking for more business management tips and tricks? Visit our blog now to keep reading.

 

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