Last Mile Delivery Solutions: The Complete Guide 2024

Are frequent delivery delays causing you to lose customers?

If so, it is critical for you to understand:

• Significance of the last-mile delivery 
• How it works
• The challenges it presents
• The last-mile delivery solutions that you can implement to overcome them 

If you are determined to learn about it all and streamline your last-mile delivery process, this blog can serve as your go-to guide.

So, let’s get started.

What is the Last-Mile Problem?

The last-mile problem occurs when you face difficulty finding the middle ground between the need for instant gratification through super-fast deliveries and the high last-mile delivery costs,  comprising around 53% of overall shipping costs.

What Makes the Last-mile Delivery Process Challenging?

Managing last-mile services can be overwhelming in today’s consumer-driven business landscape. Ranging from same-day delivery to the flexibility of choosing the preferred time or date, customer expectations are varied, putting last-mile delivery services under the constant pressure to fulfill them all. 

Below are the prominent last-mile delivery service challenges.

1. Failed deliveries

Scheduled deliveries ensure that the package reaches your customer’s doorsteps on time. However, any misinterpretation or mistake at this stage can lead to disruptions, causing delays or failed delivery attempts.

A few of the reasons behind failed deliveries can be:

• Incorrect delivery address
• Wrong route taken 
• Vehicle breakdown
• Inaccessible locations
• Customers’ unavailability

To make matters worse, the penalties you may have to pay to compensate for these failures can make deliveries even costlier.

2. Unpredictability on routes

While you can always preplan your delivery routes, you can’t ever be sure whether they’ll be able to help achieve on-time deliveries or not. The reason is the uncertainty related to traffic congestion, accidents, or blockades due to construction activities or processions. 

This can make it difficult for delivery drivers to reach destinations on time. It may also lead them to take longer routes to complete deliveries, adding up unwanted miles and time on the road, increasing delivery costs. 

3. Fulfilling customer demands

The advent of eCommerce giants like Amazon and Walmart have raised the bar for all the companies involved in last-mile deliveries. Today, customers demand same-day delivery or even overnight delivery options. These expectations don’t end here. 

They look for brands that leverage technologies like:

• Time-based scheduling to get their orders on their preferred date and time
• Real-time fleet tracking and ETA notifications to keep them informed on up-to-the-minute delivery statuses.

All these demands and expectations cumulatively require a big investment, making it hard to balance budget and customers’ demands, especially for small businesses.

4. Diverse geographical locations

Delivery addresses may vary greatly from residential apartments or high-rise commercial buildings to crowded downtown streets or rural areas. All these destinations come with their unique challenges. For example, access to high-rise commercial buildings or gated residential apartments may require drivers to navigate complex security procedures and restricted access points. 

Further, factors such as traffic, limited parking space, or one-way streets, may also affect last-mile logistics in urban areas. On the other hand, remote and rural areas may be hard to reach due to poor infrastructure, longer distances, and inaccurately mapped locations. 

5. Returns (Reverse logistics) costs

No matter how much effort you put in, you can’t stay assured your customer will like your product and won’t return it. In fact, they may be tempted to order more items if your return policies are flexible. 

While you may want your customers to order from your store without fearing issues when returning, you may also have to bear overhead costs associated with these undesired returns and reverse logistics. It may impact your bottom line and profit margins, hampering your financial stability.

6. Sustainability concerns

Customers are demanding sustainable products these days and favoring companies that follow eco-friendly practices like biodegradable packaging or electronic delivery vehicles.  However, the last-mile delivery is one of the most carbon-intensive stages of the shipping process. 

The reasons for it include frequent starts and stops while navigating urban streets, overloading of vehicles leading to consumption of more fuel per mile, and absence of proper refurbishing or recycling measures for returned products. So, managing your customers’ demands for green deliveries while scaling your business operations may turn tricky.

5 Effective Solutions to Overcome the Last-Mile Problem

1. Stay ‘Closer’ to Customers – Set Up Local Warehouses

The farther your fulfillment facility is, the higher the time and cost of delivery is. Therefore, you should open one or more physical storage spaces in proximity to your customers based on the area you serve.

This will help you:

• Reduce your delivery times and distances, making deliveries faster and cost-efficient
• Slash your carbon footprint due to the less distance traveled, positioning you as an eco-conscious business
• Adjust your inventory levels and SKUs based on customers’ demands to minimize unsold inventory and storage costs.

2. Automate your route planning

Planning delivery routes manually increases the likelihood of routing inaccuracies due to errors such as wrong address input or a delivery destination added twice. Hence, implementing a last-mile delivery route scheduling software solution can help import your address list fast while avoiding duplication or typing errors to ensure routing accuracy.

Moreover, last-mile delivery route planning software helps create the most efficient routes based on factors, like: 

• Traffic
• Drivers’ working hours
• Delivery windows
• Priority of orders
• Vehicle capacity. 

Besides, this software enables adding or deleting stops to accommodate last-minute orders and cancellations. Thus, it can help minimize the wasted time and distance on the road, reduce failed deliveries or return trips, and maximize delivery efficiency.

3. Track your deliveries in real time

Despite having well-planned routes, unforeseen situations like drivers’ sudden absence, accidents, or vehicle breakdown. This is where GPS tracking comes into the picture. You can use it to monitor your delivery vehicles’ and drivers’ locations from when they leave your warehouse till they reach customers. 

This helps you spot issues, such as more-than-usual time at a stop, schedule lags, variances from preassigned paths, or overspeeding. You can then take appropriate corrective measures to address them promptly. For example, if you find your driver is stuck mid-route due to the vehicle breakdown, you can immediately reassign the remaining stops to another available driver to avoid delivery delays and ensure timely order fulfillment.

4. Keep your customers in the loop

Customers expect absolute transparency and visibility into delivery progress. So, it is imperative to send real-time delivery notifications and dynamic ETAs to keep them posted on the up-to-the-moment progress. 

These delivery updates not only help engage customers but also ensure they are available to receive their ordered packages, reducing failed delivery attempts and return costs. Moreover, it helps cut down on ‘Where Is My Order’ (WISO) queries, providing more time to identify business growth opportunities in your business.

5. Evaluate your fleet performance

Unless you keep track of your fleet performance, you can’t expect to make improvements. Hence, reporting and analytics forms an indispensable element of an effective last-mile delivery strategy. 

It lets you monitor key metrics, including the first-attempt delivery rate, on-time completion percentage, distances traveled, fuel cost per mile, and average duration to complete a route. These KPIs can help you identify operational inefficiencies or improvement areas, make informed decisions to eliminate them, and elevate your fleet productivity.

Now that you know the best last mile practices, the next section explains what features you must seek when selecting a delivery solution to help you follow them.

Essential Features to Look for in Last-Mile Delivery Software

Your last-mile delivery and optimization software can make or break your last-mile logistics. However, making an informed choice may sometimes be overwhelming due to the plethora of options available on the market with each claiming to be the ‘best’.

Nevertheless, you can consider the most common features as below before making the final decision.

• Advanced scheduling and automated dispatch to let you schedule your planned routes instantly or schedule their dispatch for a later time and date to avoid last-minute scheduling chaos.
• Real-time tracking to keep tabs on your drivers’ and vehicles’ movements for quick  issue identification and resolution. 
• Robust route optimization capabilities to generate the shortest and most cost-effective delivery routes for on-time deliveries based on multiple constraints, such as traffic, delivery time windows, business hours, and priorities.
• Dynamic mid-route adjustments to account for last-minute orders, cancellations, or issues like injury, vehicle breakdown, or driver’s absence.
• Adaptive customer notifications to keep them informed on order status and when they can expect to receive it.
• Proof of delivery to capture to collect photos of products delivered or customers’ digital signatures and delivery-related notes for future reference.
• Reporting and analytics to help analyze and address delivery performance issues with suitable actions.
• Flexible integration with existing systems such as CRM, ERP, or accounting software to facilitate easy flow of information across your organization and get smooth workflows.

5 Last-Mile Delivery Trends to Watch for in 2024

The last-mile delivery space has witnessed a massive transformation over the past few years with technological innovations, ever-changing customers’ expectations, emphasis on environmental sustainability leading the charts.

Below are the major trends you can expect in this last-mile delivery industry.

1. Crowdsourced delivery

Delivering goods to customers on the day when they demand it is trending. This is why businesses are turning to crowdsourced delivery that helps make multiple deliveries in a day with fewer resources. Businesses work with local contracted couriers to get packages delivered to customers. 

It helps deliver goods faster, sometimes in even less than an hour and is ideal for businesses like groceries or restaurants where speed matters. These local carriers are also less expensive, helping reduce overall delivery costs.

2. Buy Online, Pick Up in Store (BOPIS)

Customers want to avoid long queues at billing counters in hypermarkets or retail stores nowadays. This is where BOPIS comes into the picture. It empowers customers to browse and pay for the products they want online from the convenience of their home. 

This model is a win-win situation for both retailers and consumers. For retailers, BOPIS helps save on their delivery costs. For customers, it doesn’t require them to pay extra delivery charges, especially for a small order of only two or three less expensive items. 

3. Local fulfillment centers (or micro-distribution centers) 

Imagine shipping a single item from your central facility in Arizona to your customer in New Jersey. Needless to say, it would cost you a deal of money and time. To avoid this, businesses are setting up regional warehouses or dark stores close to end customers. 

Retailers focus on storing popular, in-demand, and seasonal items in these fulfillment centers to minimize delivery distances and times. Local warehouses are valuable for businesses looking to expand their customer base beyond regional boundaries as they can help deliver orders to customers far away from the central supply facility.

4. Use of technology solutions

Last-mile delivery solutions are no longer optional but necessary to stay competitive. These solutions help overcome complex routing challenges. They also offer real-time visibility into order status and help notify customers of accurate ETAs to boost their trust, making them highly demanded among last-mile companies.

Some sophisticated last-mile delivery software also provides reports and analytics to track metrics, such as total successful or missed deliveries per day or idling time per vehicle. Based on these insights, you can make informed decisions to improve your fleet performance.

5. Eco-friendly measures

78% of global customers would prefer a sustainable delivery option when shopping online. To meet this rising demand for sustainability, businesses are incorporating different strategies to make their deliveries greener. 

A few initiatives final mile delivery companies are taking in this direction are: 

• Adoption of electric vehicles, 
• Using reusable or biodegradable packaging, 
• Leveraging renewable energy sources for warehouses or distribution centers
• Planning shorter and more fuel-efficient routes to cut down emissions and environmental impact
• Collecting electronic proof of delivery to facilitate paperless delivery confirmation

Upper Route Planner: A Solution to Your Last-Mile Delivery Challenges

Upper Route Planner is unmatched automation software designed to tackle last-mile challenges. It’s helped businesses reduce delivery times by up to ten hours per week, and improved their turnover by as much as 3x.

It is the best route optimizing software, helping create average increases in productivity between 40-60%.

Upper Route Planner is the most recommended delivery management solution for delivery businesses. 

In addition to the 5 essential features we mentioned above, it will also help:  

• Plan and optimize the delivery routes efficiently
• Provide real-time data 
• Find what you need easily with a user-friendly interface.

Last-mile logistics can focus on the core business operations with Upper Route Planner, with a 60% increase in profits and a reduction of delivery times up to 75%.

Last Mile Delivery Solutions: Your Key to Streamlining Last-Mile Deliveries

The last-mile delivery serves as the final phase of a product’s journey and serves a crucial link between you and your customers. So, it is important to overcome all these challenges to make it seamless. 

Understanding the last-mile problem, the challenges involved, and ways to overcome them can be integral to mastering your last-mile delivery process and staying ahead of the competition. Implementing a delivery route planning and optimization software can also help you in smoothening  your last-mile delivery operations.