Governmental stay-at-home mandate during the pandemic provoked most consumers to intensify their online buying behaviour, making their residences the final-end-point for their purchases.
The Final Mile, also frequently mentioned as the Last Mile, indicates to the very last phase of any shipment: from the transportation site to the end-user, often, it is a customer, and the place is a residential address.
The Final Mile is quite crucial for suppliers as it is the last touchpoint to make a good impression on the consumer, the last chance to keep the consumer’s loyalty because they do not stop to consider the Supply Chain procedures as a whole. What they only want is to know their demand for a product is right, on time, and to receive it in excellent condition—the Final Mile link is the buyer.
Last Mile logistics can be complicated and expensive; if something goes wrong in this phase of delivering, there is no way of hiding it from the buyer. This kind of mistakes harm cost-effectiveness, trust on your brand and possible consumer ever coming back in the long run (83% of customers will not return after just one poor delivery experience,) something concerning not only to the SC but to all teams throughout the company.
How costly is the last mile?
Edge-technology and systems development are crucial for Logistics efficiency, making Last-Mile cost hard to determine, both for urban and rural deliveries to consumers or businesses, looking for alternatives to expensive- home delivery.
The reason Last Mile deliveries could be expensive is due to ever-changing routes, the delivering of individual items to far diverse locations or constant rising of fuel prices. As a result, organisations need to keep on top of innovative resolutions that tackle delivery matters, precisely at the Last Mile.
What does the future bring?
Business executives need to start redesigning their Final Mile logistics now to stay competitive, through new business models such as:
· Click-and-collect model – It is what consumers use the most.
· Locker boxes.
· On-demand and autonomous solutions.
· Other package delivery options remain popular.
· Home deliveries will continue to rise.
The Final Mile experience will break all conventional delivery logistics, placing home delivery at the top, as it is where the carrier and customer meet, becoming the best experience possible. However, traffic, weather or other inconvenience could go out of control. The customer’s better visibility of the situation would help to handle these unfavourable outcomes.
Steps to redefine and improve Last Mile logistics:
· Improve visibility – Use telematics -an interdisciplinary tool encompassing telecommunication and automotive technologies that track all the Last Mile actions, enhancing full power of the Internet of Things (IoT) and connected technology to expand end-to-end visibility.
· Use of Big Data Analytics for a better comprehension of Last Mile cost management. When organisations make use of digital processes, the amount of data to be analysed augment considerably. Analytics delivers a new understanding of what is and is not going well in the process.
· Integrate your order fulfilment systems with the Transportation Management System TMS, a Logistics platform crucial to understanding and maintaining control over the Last-mile spend.
· Automation of repetitive processes turns out to be a “must-have” to meet the consumers’ escalating e-commerce engagement. These processes often imply the use of robotic and drones which boost cost control. However, robotics is not yet ready for full implementation, so, consider them for the near-future strategy in the Final Mile.
· The benefit of the Gig Economy – Temporary-flexible jobs are the norm in Gig Economy; also known as the crowdsourcing of Last Mile delivery encompassing drivers, independent contractors or freelancers instead of full-time employees, such as those working for Uber.
It can support the business to be more adaptable to current needs; workers could help the transportation in your company to move more cargo in urban areas so your qualified drivers can tackle the demand for rural areas or the other way around. Consider the city authorities observations about how non-traditional drivers are accelerating urban traffic congestion that would possibly end up on controlling Gig economy services in the long-run.
· Use of parcel Last Mile delivery services – Keep in mind that the delivery provider is your last opportunity to impress your customer, so, Outsourcing is an excellent way to increase volume without adding extra stress on Logistics management. The final perception represents for companies a chance to gain over customer’s satisfaction through order fulfilment.
Summing up: emerging technologies and ecosystems, such as the sharing economy, blockchain, autonomous trucks, will have a significant future impact on promoting customer’s experience and Last-mile delivery.
Are you in the process of redesigning your Last Mile delivery?
David Food is the Strategy Director of Prophetic Technology. He brings a significant breadth of skill, innovation and capability in the use of software and technology to improve supply chains, develop marketing and unlock business potential, whether globally or locally, with collaborative or enterprise-wide solutions.