Last mile delivery refers to the movement of goods from the transport hub to the final destination (be it a private residence, retail store, restaurant, office etc.) The challenge is to deliver to the customer as fast and accurately as possible. Since it has become easier for the customer to shop around through e-commerce (in Latin America alone, more than 35% of the population will make an online purchase this year and sales will total $71 billion, equal to the Middle East and Africa combined), fast delivery can ensure customer loyalty and higher satisfaction.
As a supply chain here are three current trends you need to be aware of to improve last mile delivery:
- Better visibility and flexibility
Customers expect real-time information and on-the-go traceability of their orders. Where is the package? Who is delivering it, and who is the carrier? Some forwarders use powerful software and platforms that give preferred time slots and information at every step. This may sound like a huge investment, but providing customers with better visibility and tracking also means less frustrated customers. They have fewer enquiries and when there is an unpredictable disruption, customers have a better understanding of the situation and of options. Regarding options, keep in mind, not every customer requires same-day, premium priced delivery. Providing flexibility, such as three-day delivery at no cost may mean the difference between a failed delivery and a happy customer.
- Using emerging technologies
Emerging technologies like blockchain and self-driving trucks are already having an impact on last-mile delivery. For example, blockchain makes financial transactions more efficient and secure, while autonomous vehicles can reduce road accidents and drive all night. Drone deliveries are now being authorized in Latin American countries and as regulations ease, this could mean delivery of everything from your hot steak to medical supplies to your neighborhood or doorstep with real time tracking and through secure and reliable automation. Even if you haven’t gotten on board with these innovative technologies, you may need to re-evaluate in order to remain competitive.
- Planning and forecasting
There’s no doubt that using predictive analytics tools can enhance route planning and also optimize business processes. Companies benefit by using their own app for driving and planning routes, and by forecasting demand, you can decide where to build distribution centers and how long deliveries will take. While this may initially require investment, the long-term benefits are that you will waste fewer resources and cut costs while perfecting your last mile systems. Your distribution centers will not be overflowing with inventory and goods won’t be expiring as they sit in the wrong warehouse.
Perfecting your last mile delivery systems is not just about providing a great customer experience but also about minimizing your own costs. Technologies can be leveraged to optimize your jobs by reducing failed/late deliveries, optimizing load distribution and implementing more efficient fulfillment and order batching processes. Through such integration, businesses will benefit from being cost effective while making the delivery process hassle-free for customers.