Businesses need logistics technology and focus on last-mile logistics.
The last-mile delivery process involves transporting goods from transport hubs to their final locations, which are often consumers’ homes. Since more customers buy online and demand quick delivery, it has grown in importance as a component of logistics. Because it has such a significant impact on customer satisfaction, the logistics stage of last-mile delivery is essential to the efficacy of supply chain management overall. And getting it correctly is quite challenging. Conflicting last-mile demands, such as those from customers who want things quickly but are also concerned about the carbon emissions they will generate, may make leaders feel as if they are being tugged in a number of different directions.
Here are four logistics factors that highlight the need for leaders to strike a balance between various goals.
Consumers want speedy deliveries
Consumers expect things to arrive at their doors fast after leaving a fulfilment center, and fulfilling this goal necessitates thorough last-mile preparation. Even before the outbreak, more people were turning to online purchasing. Customers’ expectations have been permanently changed by Amazon’s free subscription delivery, which started as two-day delivery in 2005 and is now one-day for select items.
It might be challenging to reverse the enhanced delivery speeds brought on by the pandemic. According to Virginia Xu, head of global branding at Sunning Group, a Chinese retail company in Nanjing, China, customers increasingly anticipate deliveries within 24 hours or even an hour. The World Economic Forum’s “Future of the Last-Mile Ecosystem” report states that “rapid delivery is the new normal” at this time. In other words, a crucial element in attracting and retaining clients is delivery speed.
Last-mile mistakes are expensive
The last mile needs to be carefully planned by business executives to avoid costly surprises. Even with seamless operations, last-mile delivery accounts for a sizable amount of a company’s shipping expenses. According to the Accenture research “The Sustainable Final Mile,” the final mile of a shipment accounts for 53% of the entire cost of transportation and 41% of the total supply chain expenditures.
The transportation times and fuel costs of trucks may also increase if businesses’ delivery schedules place them in congested areas during rush hour. Further increasing last-mile costs are failed deliveries.
Consumers want greener deliveries
Recent years have seen a rise in consumer criticism of businesses’ environmental policies, and last-mile delivery, especially quick single deliveries, can be particularly detrimental. The last mile’s carbon footprint has long been a problem for the environment and society, claims the Accenture analysis. The situation has only gotten worse as a result of increased delivery during the outbreak. Also, there isn’t much promotion to let buyers know the effects different delivery options have on the environment or how even little adjustments can have a huge impact.
Building fulfilment facilities close to customer hubs will reduce the distance delivery trucks must travel, which will help businesses meet consumers’ needs for a sustainable last mile. For instance, CartonCloud is buying shuttered brick-and-mortar stores to use as distribution sites. As a result, last-mile delivery times are shortened.
The last mile is the last impression
The last mile is an important component of logistics because if it goes poorly, the customer experience suffers. Before the last mile, customers don’t witness the supply chain process; they simply recall how it got into their hands. According to Enright, a client might pick a different retailer in the future if a delivery worker drops a costly item on the porch or it comes in shoddy packaging.