From the moment your customer places the order –– to your product’s arrival at the final destination, your goods travel through a highly orchestrated, complex journey within your supply chain. The last-mile delivery is the final phase of this journey and the most crucial step. Here, we’ll discuss the details and challenges of last-mile delivery, its importance within the supply chain and technologies employed to ensure its success.
According to the ASCM Supply Chain Dictionary, last-mile delivery refers to the transportation of goods from a distribution hub to the final delivery destination. The delivery experience carries immense weight when it comes to customer satisfaction. As the final leg of the supply chain journey, last-mile delivery bears the brunt of this weight and is, therefore, extremely important in the success of the supply chain.
Getting the delivery experience right is critically important because of its tremendous significance to your customers. According to Emplifi, consumers place speed of delivery on of their top criteria when considering a company, and 76% of consumers view last-mile delivery as a test of how much a company values its customers.
In today’s increasingly competitive e-commerce-driven world, it’s all too easy for customers to choose a different company as their product’s supplier. You could lose a customer if you can’t offer a seamless, efficient, fast delivery process. And if that customer leaves a bad review, your brand reputation will suffer. That makes the role of last-mile delivery a crucial brand identifier, and, when executed well, a powerful competitive advantage.
Last-mile delivery your company’s final touchpoint with customers and can make or break their overall shopping experience with you. By optimizing last-mile delivery operations, you can set yourself apart from the competition while reaping several key benefits:
E-commerce has raised consumer expectations concerning shipping. These days, your customers not only expect their shipping to be fast –– but they also want it to be free, which cuts into your profits. Keep in mind, while last-mile delivery is by far one of the most important elements of the supply chain process, it is also the most expensive. In fact, last-mile delivery can account for 53%* of a shipment’s total cost. In order to stay competitive, companies are constantly striving to improve efficiencies and cut costs in this final leg of delivery logistics.
The complexities of delivery logistics combined with the rise in customer expectations pose several challenges to companies implementing last-mile deliveries:
There are several technologies available to help you implement strategies and tactics that maximize last-mile delivery to lower costs and increase customer satisfaction:
Robots and self-driving vehicles can be programmed to follow predetermined routes. They are usually equipped with GPS, cameras, advanced sensors and AI to avoid obstacles and even adapt to environmental changes.
Benefits
In order to move inventory closer to the consumers and expedite delivery, many companies are decentralizing their storage and distribution networks and opening small-scale storage facilities and order fulfillment centers in prime retail or commercial spaces. By using warehouse management systems (WMS) and the Internet of Things (IoT), companies can optimize day-to-day operations and gain real-time inventory visibility across multiple facilities.
Benefits:
This is an integrated approach that enables businesses to deliver products to customers through multiple channels –– such as brick-and-mortar stores, online platforms, mobile apps and social media. It incorporates unified order management systems (OMS), real-time tracking and notifications, and communication platforms like chatbots and SMS to ensure a seamless and consistent customer experience across all touch points.
Benefits:
Companies use ML and AI algorithms to quickly analyze mass amounts of data, including weather, traffic and customer preferences. This gives companies the ability to improve delivery scheduling and track deliveries in real time.
Benefits:
The following links provide more in-depth information on other supply chain topics:
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