Logistics Companies Challenges & Solutions in 2021

Last mile logistics is among the most searched terms in the last decade. Last-mile solutions have been continuously evolving year to year and day by day. By thanks to technology updates, it is possible to see and figure out challenges in this industry. With the online business growing and the increase in demand for home deliveries, there have been a lot of challenges in this vertical. With the transformations in technology, experts are able to figure the lagging sub sets and areas of improvement. 

What does the term Last Mile Delivery Actually Mean?

Last mile logistics is one of the most crucial legs of the supply chain. Any delivery operation in the supply chain is incomplete without last-mile delivery. It can also be considered as a transportation facility that moves products in form of parcels and packets from warehouses or hubs to end users that have ordered the product. 

Importance of Last Mile Logistics

Last-mile delivery is the only vertical in the supply chain that comes in direct contact with users. If we take the example of online shopping websites, no user comes directly in contact with the store. Everyone is shopping on a virtual background and payments are also made virtually in some cases. 

So, in this case, only, the delivery guy is the person that comes in with direct contact with the end customer. So, this segment of the supply chain optimization is really important to take care of. Last mile logistics can have a direct impact on the customer experience and brand building of your organization. Timely, accurate delivery with good behavior of delivery person will hold a good customer experience, benefiting your overall brand value.

In a few sentences, it’s difficult to express the complexity of last mile delivery companies India. logistics has a significant effect on supply chain processes, ranging from company priorities to organizational KPIs to customer engagement and loyalty.

Challenges

Last mile logistics will account for up to a quarter of all shipping costs. While investing in last mile operations is critical because it directly impacts customer experience, there is always a need to cut costs, particularly at a time when ensuring free and same-day delivery is becoming increasingly important. Here are some key challenges that last mile industry is facing these days- 

Success Rate

For a profitable business, last-mile delivery needs to have a good success rate in the first delivery. To check the status of delivery and keep concerned with the expenses of the organization, healthy quality and volume of first delivery is a must. Inaccurate address and majorly postal address is the main factor of drop in success rate. When the postal address is incorrect, the management of orders goes wrong as they are categorized based of postal address. 

Early Delivery

The market is getting very competitive these days, and everyone wants delivery earliest as possible in this busy schedule and city life. The major obstacle for last-mile delivery is to deliver the product to the required address on time mainly. So, customers are these days very obsessed with accurate delivery time and they want TAT to be minimal. 

Environmental Factor

Rising levels of carbon emissions are prompting governments and international organizations to enact more stringent legislation aimed at reducing carbon emissions. It’s important to stay away from high-risk areas. Due to a shortage of drivers, especially for long-haul transportation, it is critical for supply chain and logistics stakeholders to ensure that those who are available operate at high levels of productivity.

Route Optimization

Rout optimization is a crucial factor for proper functioning of this vertical that is knows as last mile logistics. Suppose if your vehicles that are delivering products are stuck in traffic for excessive time, then it will lay a bad foundation for your company. Not only you will spend more on fuel prices, but late delivery will also lead to a bad customer experience.

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So, proper route optimization is required to get the delivery on time and be economical for your fuel resources. These days technology is playing a vital role in route optimization.  I mean everyone is familiar with maps and GPS-enabled route optimization. It is quite a good idea to plan your path accordingly and deliver your products hassle-free. 

Manual Intervention

Last-mile delivery operations have traditionally relied heavily on manual labor, and it cannot be ignored that manual labor is costly and prone to errors. In a supply chain, advanced distribution software will significantly minimize the need for human capital to perform last-mile logistics operations. It automates tasks such as route planning and task assignment accordingly to the best option.

Artificial Intelligence

All are becoming more real-time and digital in this digital era. With the advancement in technology, we have seen a significant increase in the demand for product distribution from both online and offline platforms. Different delivery systems, such as same-day delivery, swift delivery, planned delivery, and workplace delivery, have raised consumer standards.