One thing is clear for every ecommerce business. From the moment a customer makes a purchase to the moment your last mile carrier delivers their order, everything has to run smoothly.
Given the ecommerce boom, customers now expect a seamless delivery experience each and every time. Your last mile carrier plays a major role in this process – after all, you’re trusting them with your brand. If they deliver a bad experience, your customers will blame you, not them.
But what is the “last mile”, why is it so important and what can you do to improve it? Keep reading to find out!
What Is Last Mile Delivery?
Last mile (or “final mile”) delivery is the journey a parcel takes from a warehouse or fulfillment center to its intended delivery location. It’s the final and most important part of the end-to-end logistics process.
This process usually follows these steps:
One: Orders enter into a centralized system and recipients are able to track their order via a tracking number.
Two: Orders arrive at the transportation hub and await delivery to the recipient. Once orders arrive, they need to be sent out to customers as soon as possible.
Three: Routes are created for delivery personnel based on the recipients’ addresses.
Four: Orders are scanned and loaded onto delivery vehicles.
Five: Parcels arrive at their final destinations and tracking updates to show proof of delivery.
The group in charge of executing these five steps? Your last mile carrier.
What Is a Last Mile Carrier?
A last mile carrier is usually a postal carrier (think UPS, FedEx, etc.) or a regional courier. In some cases, fulfillment companies will deploy their own carriers from their own fulfillment centres (think Amazon or Bolt). Either way, they are responsible for getting your customer’s parcel to its final destination. Making the right choice when it comes to selecting a last mile carrier for your business is critical.
Why Is Your Choice of Last Mile Carrier So Important?
You already know bringing any type of partner into your business is a big decision. But there are some standout reasons that make your last mile carrier exceptionally important.
1. It’s a Choice That Can Help You Improve Your Business
With the growth of ecommerce, there are now more last mile carrier options than ever before. Finding the one that will suit your business needs and improve your delivery logistics is an important choice. At the end of the day, your last mile carrier plays a major role in:
- Creating a great customer experience
- Customer retention
- Structuring your end-to-end logistics
- Building a positive brand reputation
2. Ecommerce Has Exploded in Popularity
As a result of the pandemic, ecommerce sales have skyrocketed. Canadian ecommerce revenue in 2019 was just over USD $25 billion, and by 2024, that number is projected to soar to more than USD $36 billion. Overall, ecommerce industries have accelerated by about a decade in the last year and a half. Many are even calling a new era of commerce.
The surge has forced many businesses to adapt quickly. A high-quality online experience has become an even larger cornerstone for businesses to thrive. And while every customer interaction matters in this new retail environment, the last mile is by far the most important.
3. Relying Solely on Brick-and-Mortar Shopping Is No Longer an Option
It’s not enough to rely on brick-and-mortar shopping anymore. With shopping habits changing, people have grown more accustomed to online shopping. Plus, there is now an increased sensitivity to public health and safety. It’s safe to assume this will affect how customers approach in-store shopping in the months, and possibly years to come.
According to a 2021 Shopify survey, 46% of respondents said they feel uncomfortable shopping in person. Additionally, 79% of respondents said they will regularly shop online within the next six months, and significantly less (57%) say the same for in-store shopping.
The safety, convenience and newfound choice that comes with online shopping suggest that it is only going to become more important, and more popular, in the future.
Overall, your choice of last mile carrier is a huge part of making this part of the customer journey successful. No matter how loyal your customers may be, too many bad delivery experiences can leave shoppers feeling sour.
As much as poor delivery experience may be the fault of the carrier, it still reflects on your brand. Despite being out of your control, it can ruin customer relationships. With customer expectations and the influence of online reviews at an all-time high, you need a last mile carrier that can help you create a great customer experience every time.
So, what does all this mean for your business? It means that prioritizing ecommerce and the strength of your last mile delivery experience has to be top-of-mind going forward.
What Are Customers Looking for Out of a Last Mile Experience?
Businesses that excel in shipping and fulfillment have a clear advantage over those that don’t.
The 2020 Canada Post report on ecommerce proves this in its breakdown of the biggest influences driving retailer choice. Here are the top four:
- The retailer offers free shipping: 80%
- The retailer manages and lives up to delivery expectations: 52%
- Offers a better returns policy: 50%
- Offers faster shipping: 46%
The numbers don’t lie. Retailers who can get the product in the consumer’s hand faster, more conveniently and for less have a leg up.
It may sound obvious, but many businesses overlook these factors – and it’s understandable. Some retailers simply lack the time, energy and resources to think critically about their last mile experience.
Many of the roadblocks that prevent faster shipping are also far bigger than any one retailer. This is especially true recently, as high demand and strict health and safety measures have overwhelmed the broader fulfillment network. Companies that overcome these challenges and keep customer inconveniences to a minimum have had a major advantage in this climate.
That said, even in less uncertain times, fast and reliable shipping has always mattered and it will continue to play a major role in consumer choice and abandoned carts going forward.
What Other Challenges Are Associated With the Last Mile?
Although the last mile is the shortest part of the end-to-end logistics process, that certainly doesn’t make it the easiest. It can be both inefficient and expensive, especially if you’re trying to manage last mile logistics on your own!
Independent contractors are difficult to track as they make multiple stops with low drop sizes, especially in rural areas where delivery points are far apart. Even in urban centres, the benefit of closer delivery points is essentially negated by traffic, delays and other unavoidable circumstances.
Managing last mile delivery is also expensive, frequently coming out to be more than 50% of the total cost of shipping, warehousing, route optimization, fleet, labour and related costs.
However, the rise of same-day and faster shipping options leaves customers unwilling to foot this bill – it’s an expectation, not a luxury that customers feel they should pay for. This makes it all the more important to find ways to improve this part of the process and cut costs wherever possible.
Here’s How You Can Improve Your Last Mile Logistics
It’s time to look at ways you can improve this crucial part of the fulfillment process.
Continue reading to find different ways that you can offer a better last mile experience to your customers.
(Pro tip: Some of these you can try in-house on your own without a 3PL partner, but all of these optimization tips can be provided by most 3PLs!)
1. Offer Tailored and Transparent Delivery Options
Interested in going above and beyond for your customers? Consider customized delivery services that are tailored to their purchases.
This can be especially beneficial when shipping large items such as furniture pieces or appliances. In these cases, offer something specific to your business such as assembly or even haul-away services.
2. Offer Tracking
When possible, send out orders with tracking information. This excites customers by letting them follow along with their order and lets them troubleshoot on their own. If they’re wondering where an order is, they can track it in real time – win-win!
This also leads nicely into the next tip, which is…
3. Don’t Deliver Late
As a customer, we’ve all been there; you place an order knowing it’s supposed to make it by a certain date, and…it doesn’t make it in time. Or you change your plans to be home for your 8:00AM to 1:00PM delivery window, but it arrives at 4:00PM.
A bad delivery experience can really throw things off.
In fact, access to delivery details often influences purchase decisions regardless of shipping times, leading to less abandoned carts.
Ensure a transparent delivery process with last mile tracking and clear communication. Real-time information on a package’s whereabouts, including an estimated time of arrival, can eliminate confusion and frustrations. To create an even better customer experience, offer text alerts that update in real-time.
4. Have a Proof of Delivery Plan in Place
Proof of delivery is important for customers and for your business. Proof of delivery means that there is some form of a trail showing that the delivery was actually made. This is extra important for deliveries that is left on a porch or with a concierge. This can include photographs, notes, or signatures.
No matter what you choose, you’ll want something to prove the package was there at some point; there’s no worse delivery experience than a lost package on your team’s part. This ensures easy confirmation with the customer and protects your team from loss claims.
5. Work With a Dedicated Logistics & Fulfillment Partner
Last mile logistics is a lot to manage, so leave the responsibilities to a dedicated team of experts! Give yourself time back to yourself to focus on what you do best!
The right logistics partner acts as just that – a partner. They make the process even easier by completing the four recommendations above and then some. Other perks of working with a logistics partner include:
- Storage: No more storing products in your house, garage, or anywhere you can find space. The right fulfillment partner will store for you
- Inventory management: Ecommerce platform integration allows you to seamlessly track inventory
- Savings on shipping: Most fulfillment partners work with a ton of shipping companies, meaning they can find you better rates. Any savings they find are passed onto you
Regardless of whether you’re in growth mode or simply looking to improve your end-to-end logistics, bringing on a fulfillment partner could be just what you need to take your last mile experience to the next level.