17 Mar 2023

Problems in Last-mile Delivery & How To Address Them

Tackling Last-Mile delivery challenges not only benefits customer satisfaction metrics & but improves your brand value while making your logistics efficient, scalable & revenue-driven.

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With the e-commerce market seeing an exponential boom, parameters directly influencing customer experience & retention have changed with time as well. Buyers’ behavior repurposes their attention to vendors & online marketplaces that provide faster on-time delivery, sometimes directly to their homes. Such emphasis on customer satisfaction is needed for companies to improve their infrastructure & focus keenly on shipping logistics with better OTIF metrics.

The result was the last-mile delivery process which improved the efficiency of the final leg of the shipping operation from the warehouse or fulfillment center to the recipient’s address. As one of the most crucial pillars in the logistics process, the titular functioning, like any good, accountable process, needs a centralized system with utmost collaboration. But sometimes, even the most astute framework is battling with exceptions — with the problems in the last-mile delivery ranging from operational to financial.

In this write-up, we focus on our problem statement —

Table of Contents

What Are the Challenges of a Last Mile Delivery Service?

  • Higher Delivery Cost

    Speeding up any process requires additional setup, which involves tech support to an additional workforce, a requirement that subsequently dials up the operational cost. For any business to be sustainable, its balance sheet should reflect the cost-effectiveness of its workflow. But with enterprises employing last-mile delivery, this can be a bridge too far. The finance incurred with the additional fleet, drivers onboarded, and multiple stoppages for deliveries contribute towards extra investment, which needs monitoring to ensure that it doesn’t eat into a company’s revenue.

    This proves to be a further thorn in the functional area if a delivery gets failed, is canceled, or is delayed & requires further manual intervention in route planning or crew allocation. In a distribution setup, be it last-mile or normal, redundancy means operational hours are not optimized, which means negative ROI. In addition, factors like inflation need a constant overview to adjust the working cost.

  • Delays

    The biggest bottleneck mentioned briefly above is the delays caused in the shipping system. While there are systems to live track the shipping status, meeting delivery deadlines offsetting the delay proves to be costly & collectively heavy on the company’s expenses. The best counter option to tackle such set back is to have an accountable distribution network with transparent collaboration & communication channels.

    Considering customer behavior, especially with the e-commerce industry providing transparency in the logistics of the ordered product, delayed shipment, if left unchecked, can result in order cancellation, which in turn is a loss equation for an organization. Not to forget, such bad transactions reflect poorly on a company’s reputation, which might lead to losing out on its customer base.

  • Real-Time Visibility

    Ever since the crescendo effect of the online platform, the accessibility of products through the diverse demographic region has led to an increase in order numbers. Such transactional value has meant that the organization had to look for multiple stakeholders & external partners outside the company’s workforce. And, with numerous collaborators at work, keeping track of regular shipment updates sometimes becomes a challenge.

    But, with a visibility tool at the core of functioning, an enterprise can manage communication with key figures in an orderly manner, from packers to drivers to personnel completing the last-mile delivery. Such end-to-end transparency ranks highly amongst patrons.

  • Inefficient Route Planning

    ‘Optimization’ might be the most operative keyword for reducing the complexities of the entire supply chain network, and optimizing delivery routes is just an extension of principles taking shape into action. One of the prominent last-mile delivery issues is poor route planning, which ultimately leads to abysmal turnaround time right from the stage of order initiation. To reduce the cost of logistics and transportation expenses, businesses employ transport management software that aids a company in planning efficient routes, which not only saves on time & cost but ensures that it is capable of tackling an impromptu last-mile delivery problem with real-time updates & productivity driving KPIs.

  • Outdated Tech Infrastructure

    Any enterprise looking to be ahead of its competition requires implementing the latest technology across the supply chain factions to upend bottlenecks caused by outdated & traditional ways. A modernized delivery setup can witness an increase in productive output with superior numbers enabling transportation to tackle numerous last-mile problems. Not only limited to a more responsive structure in case of a contingency, but process automation also opens up virtues for your business to be scalable, profitable & sustainable simultaneously.

  • Unpredictable Events

    How do you plan for unplanned events? It’s a paradoxical statement with no answers, and practically no system in place could counter it. But, having an accountable & visible network does help to maintain the decorum of the entire operative procedure to withstand last-mile delivery issues owing to organic problems such as weather challenges, roadblocks, traffic & in some cases, a pandemic as well. With a clear communication channel & simulation practice of life-like contingencies, an enterprise stands an excellent chance to mitigate impromptu challenges.

  • Fewer Profit Margins Due to Order Return

    One of our key points above was how last-mile delivery needs a proper structure to run its operation, eventually costing a company a sound investment upfront. Now, for such a setup to come good, everything needs to work without hindrance, including no reverse logistics. But if stats are some semblance, a general order life cycle sees one return for every four orders processed. This means that if the ratio of bad transactions (read: order return) increases, an organization will subsequently see fewer profit margins.

How to solve last-mile delivery problems?

With 3SC’s last-mile delivery services, you get end-to-end visibility of your entire logistic process. With a singular dashboard giving you complete accountability of stakeholders & the transit status – your operations become adept at nullifying real-time transportation challenges, making your business scalable, efficient, & revenue-driving. If you are looking to make your last-mile delivery operations more efficient, contact us today for a demo.

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