Last mile delivery – a key attribute of supply-chain process is sometimes under-estimated in transportation industry. By its simplest definition, it is a process of delivering or transporting goods from one to place to another or to end customer. However, it contributes to multiple key success factors for businesses to improve visibility while reducing overall shipment costs. Today, adoption of high-tech innovative platforms is trending however gap remains to integrate all different platforms for streamlined supply-chain logistics. To understand the concept, challenges and benefits of last mile delivery, let us dissect overall transportation process.
What is last mile delivery?
In transportation planning and logistics, last mile describes movement of deliverable goods from distribution center to its destination. The distribution of goods includes both pick-up and drop-off activities that are usually restricted by a time window.
Last mile is not always about “last mile”, destination distance can range from a very few miles up to 100 miles and more. In addition, distribution of products could include multi-point delivery that require multiple tasks to be completed within specified time window adhering strict service level agreements. In more generic and simpler cases, last mile delivery involves use of courier service providers that delivers ordered product(s) to end-customers.
How last mile contributes to distribution network?
Freight transportation costs in the United States amount to about 6% of the GDP, which means that a large portion of a company's supply chain costs come from transportation. In addition, there are different mode of transportation of goods depending upon nature of the job. For instance, moving raw material for a manufacturing industry may involve movement of heavy vehicles while delivering products to end-user could be done using light weight vehicles. Also, cost and time varies for each mode of transport.
The most prominent benefit last mile delivery brings to distribution network is the cost effectiveness and increased efficiency. Delivery process can range from a very simple to highly complex job. For instance, acceptance of delivered product depends on availability of receiver. The receiver may object and reject the product based on its condition or delays.
Today, there are different approaches to make last mile delivery more efficient and cost effective. For instance, Amazon and Ali Baba have been using drones to deliver products to their customers. This fast delivery solution also has dropped the cost of their deliveries. Similarly, in Europe, Germany and Poland, large distributers have been trying new innovative automated technologies to deliver products and cut operational costs.
Why you need a last mile delivery platform?
Increased supply chain visibility and cost effectiveness are two primary goals for a business to invest in last mile technology platform. In some cases, it is merely done to impress investors and to increase company’s advancement in innovative technology adoption. However, applying a seamless process for supply chain has been a challenge for most of the industries. This challenge comes due to high complexity in integration of multiple systems. These systems generally include inventory management, warehouse management, work-force management, customer relationship management (CRM) and enterprise management systems (ERP).
Today, with rise of the digital economy and availability of newer and simpler platforms such as Airbnb, Uber, Postmates have changed end-user experience and overall expectations. End-users are now more accustomed to real-time updates and visibility. Thanks to mobile based tracking applications, that can serve many different purposes including renting a room or place to stay, pooling ride, ordering food to office or home.
Mobile based tracking applications have upgraded consumer experience and this change is now converging into business sector due to its simplicity and cost-effectiveness. Today, location tracking mobile apps have changed transport industry at large and technology is further evolving to improve driver safety and security.
PickFleet is a web-based last mile delivery platform that provides real-time tracking, scheduling, and intelligent reporting to supply-chain distribution Industry