All of us love ordering products online. Life has become more comfortable. We need to have an internet connection and a smartphone to get products delivered to our doorsteps. The final step is the process of transporting items from the distribution center to the consignee, which is referred to as last mile logistics. In this process, small parcels or packages are used to get the products delivered to the end customer. The products can be delivered within a few blocks or to more than 100 miles away. According to McKinsey and Company, the value of the parcel is even more than $83 billion. With the growth of the e-commerce, this value is almost going to double in the next ten years. As fully integrated Omni channel, retailing is becoming more popular, this Last Mile delivery is becoming even more critical. Due to the growing demand, the current transportation information has to be given by the retailers.
Why is Last Mile Delivery Becoming Crucial?
Due to LM logistics, the shippers can deliver the products to the customers quicker and at low cost. There are customers who are ready to pay extra money to get the products delivered instantaneously on the same day. Many successful e-commerce sites like Amazon have adopted and mastered in last mile delivery. With the help of prime delivery options, the product can reach to you faster. Some of the small e-commerce websites are also looking forward to growing their market and incorporate more of the last mile delivery services. John D. Schultz of Logistics Management expects that the e-commerce is going to reach the $2.4 trillion mark by 2018 and there is going to be a huge growth in LM logistics as well.
What are the Challenges Faced?
- Delivering products at a faster rate will become difficult in urban areas due to extreme traffic issues. Also, there will be a rise in the costs of fuel if last mile delivery becomes more popular. Amazon provides this service at affordable rates, and it will be an issue for other websites to match within the price.
- The complexity also increases with last mile delivery system. The large products are difficult to be assembled, and it is troublesome to ensure that the final product is the replica of what was sold. There are also some products which have to be installed by skilled professionals. Customers look for more visibility for bulky materials and want them to be shipped earlier, but it becomes difficult for the retailer to get the work done.
- To incorporate the last mile delivery system, there have to be more drivers working for the company. If there is a shortage in the capacity, it will not be possible to deliver products to many clients at the same time and day.
How to Overcome the Challenges?
- If the customers are looking forward to picking up the ordered item at the location, there can be delivery lockers which will hold the products. The storefront pickup location of Amazon is doing great and it has solved the issue of delivery.
- Although this one will take much time to be incorporated, there can be robots and drones which can help in getting the items delivered. Artificial engineering and machine learning are advancing and looking forward to these techniques as well.
- If the route optimization technologies are improved, the costs of last mile delivery will be reduced. This will increase the efficiency of getting the products delivered.
- The retailers can also look for drivers who are in need of new opportunities and increase their capacity to get products delivered quickly in the stipulated time.
The importance and the efficiency of the last mile delivery has been discussed in the above points. It is sure to be highly prevalent in the upcoming years. After all, who doesn’t want their products delivered really fast at doorsteps?