Blog post created by Adam Robinson and originally published on October 2, 2017 on http://cerasis.com
Understanding last mile logistics is only half the battle. Shippers need to reevaluate their existing last mile logistics processes and devise an effective last mile logistics strategy that aligns consumer and business expectation.
This is the only way shippers can safeguard their position in the market and continue to provide products to their consumer basis. In fact, an effective last mile logistics strategy must consider these nine key points.
1. Planning Is Essential To Have an Effective Last Mile Delivery Strategy
Any effective strategy must begin with effective planning. Shippers must evaluate current last mile logistics strategy processes and create plans for managing the creation or adoption of an effective last mile logistics strategy. As explained by Tarra Singh of Supply Chain Beyond, this includes prioritizing planning and establishing standard operating procedures for managing last mile logistics
2. Leverage the Right Technology as Part of Your Strategy
One of the first problems with creating a last mile logistics strategy is cost. According to Mitchell’s NY, last mile logistics is seen as the least efficient leg of shipping, and it accounts for up to 20 percent of the total shipping cost of a product. Last mile delays and problems during delivery can eat away at fuel costs and seriously devalue a brand, but shippers can leverage technology, such as Big Data, to make small changes and improvements to last mile logistics processes.
Shippers considering implementing or upgrading technology to meet last mile logistics demands should also consider ease and speed of implementation prior to making any such decisions. E-commerce markets move at the speed of light, and unnecessary delays could result in customer losses.
3. Analyze Everything
Nothing should be off the table when considering an effective last mile logistics strategy and implementation. Shippers should analyze everything from the biggest to the smallest possible influencers.
4. Manage the Whole Last Mile Delivery Process
Shippers must manage the whole last mile delivery process in effective last mile logistics strategies. This includes the driver, the shipment, the trucks, the technologies used to track such shipments, online platforms and consumer devices. Obviously, shippers cannot track what consumers use their personal devices for all the time, but they can use metrics and Big Data to track what consumers are doing on their respective e-commerce sites.
5. Be Consumer-Centric
An effective last mile logistics strategy must be focused on consumer needs. This is the cornerstone of all modern logistics strategies, regardless of whether it is direct to consumer or business-to-business sales.
6. Think Outside-the-Box
Traditional standards of delivery do not work effectively in modern last mile logistics strategies. Companies must think of unconventional solutions to meet last mile delivery demands, like Uber, Instacart or Deliv. These app-based last mile logistics providers are disruptors, but they can enable shippers to meet consumers growing demands for faster, tighter delivery Windows.
7. Measure Performance
Amazon sets industry standards for last mile delivery, reports the Supply Chain Game Changer, and the e-commerce giant’s free shipping services, otherwise known as Amazon Prime, highlights why shippers must measure performance.
With up to 6 percent of consumers in the US willing to pay for same-day delivery and 28 percent of consumers are willing to abandon their shopping carts due to excessive fees, shippers cannot afford to forgo measuring performance. Performance measurement goes back to cutting costs wherever possible, without sacrificing quality or service.
8. Manage Returns Thoroughly, Effectively
Managing returns and reverse logistics are another consideration in creating an effective last mile logistics strategy, reports Industry Week. Retailer differences in SKUs and returns options for both e-commerce and brick-and-mortar store purchases can complicate the issue.
As a result, shippers should consider the form, function and placement of inventory, including inventory coming in from reverse logistics channels, in their entire warehousing and distribution network. This will ensure the company has product, even if it is refurbished or returned product, available nearest to consumers.
9. Location. Location. Location
One of the final considerations goes back to how quickly a product can be mobilized and delivered. It goes back to the location of the product and the location of consumers. Shippers must create robust last mile logistics strategies that shrink the distance between warehouse and consumer.
This might include using stores-as-a-distribution center. Ultimately, shippers that reduce this distance as much as possible and through as many means as possible will be able to create a tighter, more effective last mile logistics strategy.
After crafting an effective last mile logistics strategy, shippers come to one ultimate conclusion. They need to revamp the technology and processes used in managing both overall and last mile logistics. Moreover, last mile logistics is key to reducing overhead and improving customer service.
As a result, more shippers will turn to technology and newer transportation management systems (TMS) to aid in the efficient execution of the last mile.
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