Problems & Challenges Of Last Mile Logistics

Last Mile Delivery

Amid the pandemic, people were locked at home, and we saw extreme growth in the eCommerce industry. Along with the development, we also saw severe disruptions in the global supply chain. Everyone is aware of the shipping issues, as with changing times, the world has become more dependent on same/next-day delivery. 

Delivery prices across the globe also increased, and businesses hoped the situation was temporary. However, with the increased demand for affordable delivery and ever-growing competition, companies were looking to solve the biggest challenges of last-mile delivery. 

Last Mile Delivery

Competition & Customer Expectations

Although eCommerce businesses have been growing and many companies are trying to match and walk in the footsteps of giants like Amazon, trying to enhance their online offerings with a comparatively broader product catalog and prime subscription delivery options. 

Customer expectations are increasing with each passing day, and every customer expects timely product delivery and a stellar post-purchase experience. To keep up with changing expectations, finding ways to optimize last-mile deliveries and fulfill orders faster is integral. 

You will find big and small competition in every industry you open your business in and the best way to stay ahead of your competition is to invest more time in good tech and provide customers with extraordinary post-purchase experience.

7 Challenges In Last-Mile Delivery

Rising Costs

Last-mile is the final step of the delivery process. However, it is the most expensive for both the end consumer and the business. Not only this but integrating new infrastructure to manage the overload of demand also adds to the cost. Also, many hidden expenses arise during delivery, such as delays and order cancellations. 

Unfortunately, you cannot pass on these costs to the consumer. Customers can abandon carts when they see any added expenses they didn’t expect. Therefore, the best option is to absorb and minimise these costs elsewhere. 

Delays

Late deliveries and failure to meet delivery deadlines can be extremely expensive for a business. In global shipping, delays are simpler to foresee. However, it is costly to cancel orders. So, the best is to plan the delivery routes carefully and avoid delivery delays and keep your customers satisfied.

In some cases, late deliveries can lead to cancelled orders, and if you can anticipate order cancellations beforehand, then it is best to cancel orders on the go. This can save your time and energy from undergoing a complicated returns process. However, you will have to deal with the high expectations of the customer and late delivery penalties. 

Unpredicted Issues

Always keep a buffer for things to go wrong and have an unexpected tolerance for things that go wrong. Depending on the industry, we should set aside a financial reserve of around 5% to 15% of the total amount in case of any unforeseen expenditure. 

It is also paramount to have a contingency fund in place. You should have the funds to deal with any unforeseen complications. The amount can depend on the difficulties you have previously dealt with.

Last Mile Challenges

Real-Time Visibility

Lack of visibility is one of the biggest challenges in last-mile delivery. Fortunately, it is also one of the easiest issues to solve.

You can implement visibility tools that allow real-time communication with the delivery executives. Customers will also appreciate the ability to track their shipments in real-time instead of relying on tracking codes that don’t update timely.

Inefficient Routes

Optimizing delivery routes is one of the best ways to reduce your operating costs for last-mile delivery. This has a higher chance of increasing customer satisfaction and making on-time deliveries. 

Outdated Technology

Many modern-day businesses still use obsolete delivery and supply chain technologies. Even when businesses implement modernisation, for some reason, last-mile delivery is often overlooked. The changes that are done are mostly for warehouse upgradation or global transportation.

However, even small last-mile delivery changes can present excellent results. Optimising your deliveries is an art, and there are many tools that’ll help you manage that. On a broader scale, using GPS devices and tracking softwares can help you manage and increase the visibility of real-time deliveries. 

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Reverse Logistics

In case you have no clue what we are talking about, reverse logistics refers to when a customer returns your goods, and you bring them back to your warehouse or manufacturing facility. Your brand will also need a return shipping system for efficient product returns. 

Reverse logistics doesn’t only benefit the customer but also builds trust with the consumer and increases the chances of repeat purchases. 

Conclusion

All businesses want to compete with their competitors and maintain customer satisfaction simultaneously. The customer’s expectations and supply chain logistics are constantly changing, and it is best to monitor the biggest challenges of last-mile delivery and keep upgrading your approach to logistics.

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Malika Sanon

Senior Specialist at Shiprocket

Malika Sanon is a Senior Content Specialist at Shiprocket. She is a huge Gulzar fan, and that’s how she got inclined towards writing poetry. Started her career as an Entertainment journalist and lat ... Read more

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