The Best Software To Manage Last-Mile Logistics

The last few miles a delivery takes from facility to recipient might just be the most essential part of a delivery journey. People are prepared to pay premiums to get their package delivered in a day, with customer loyalty increasing for businesses that meet these deadlines. Amazon invested in their last-mile logistics heavily in 2020, with many large retailers following suit.

 

What is last-mile logistics?

What is last-mile logistics?

Last-mile delivery (or logistics) refers to the final few miles a package takes between a distribution centre and the customer. It could be one-mile (if the customer lives one-mile away from the facility) but the delivery distance is frequently over 50 miles or more. Unlike the middle-mile, which traditionally only impacts larger retailers and producers, the last-mile of a delivery affects everyone, as all goods need to get to the customer.

Costs for those final miles can reach over 50% of the total cost of delivery, and also carry the highest risk of business loss. If a customer pays a premium and the delivery doesn’t arrive on time, the last-mile can cost the producer the whole order.

Who is involved in last-mile logistics?

The last-mile can impact everyone in the supply chain, from producer to customer. The size of the delivery may mean that a wholesale distributor is involved in sending the goods to the retailer before it reaches the final fulfillment center. Let’s take a look at how these parties interact with a delivery in the last-mile.

Wholesale distributors

Wholesale distributors assist the supplier or producer of the goods by distributing them in bulk to retailers. They are an integral part of the supply chain for multiple sectors, from fast-moving consumer goods to construction materials and electronics. Wholesalers ensure that the goods reach the distribution hub in time to meet the demands of the last-mile delivery.

Wholesalers have also been disrupted in recent years by an uptake in producers selling directly to the customer. A Deloitte study suggests that this has led to a decline of almost 8.3% for wholesalers between 2006 and 2016. This leads to increased pressure on wholesale distributors to fulfil timelines for retailers and add value to their role in the supply chain.

Retailers

Retailers and delivery

Retailers also face pressure in fulfilling the demands of the last-mile. They require wholesalers and producers to deliver on time, in order to meet the delivery date for the customer. This is particularly essential with fast moving consumer goods like groceries. A CapGemini survey revealed that 40% of customers cited food delivery services as an essential part of grocery purchases, with half those surveyed prepared to switch to a retailer that provided a better delivery service.

Retailers have two options when coordinating last-mile deliveries:

  • Manage their own distribution hubs for online shopping and orders
  • Outsource to a delivery service or fulfilment center to meet customer demand

The huge premiums and customer loyalty associated with deliveries are an integral part of a retailer’s income. Speed in last-minute delivery will also expedite the processing of return goods for the retailer (currently estimated to cost retailers £60 billion a year in the UK alone), getting items back on the shelves as quickly as possible.

Fulfilment Centers

Fulfilment centers are warehouses or facilities that store goods for retailers and producers and carry out distribution services on their behalf. Unlike simply renting a warehouse, a fulfilment center will also carry out the last-mile delivery to the customer. The success of a fulfilment center rests entirely on their ability to carry out the last-mile. In 2020, online orders increased by 50%, accelerating the evolution of fulfilment centers by more than a decade.

How is the last-mile logistics organized and what are the biggest challenges?

Check out the structure of last-mile logistics and how it is organized below.

There are four main areas that present the largest logistical challenges for delivery:

Speed

delivery speed

The speed of the delivery is determined by the expectations of the customer. But each route will present its own operational changes that can impact the speed of the delivery. A delivery driver that needs to make multiple stops in a large urban area may be impacted by traffic, while deliveries to countryside areas may need to cover large distances within the small window of a one-day delivery. The shorter the delivery timeline, the more likely it is that even small delays will impact the speed of the delivery.

Cost

The decision to outsource deliveries to third party fulfilment centers or businesses like Amazon will leave you without the responsibilities of handling the last-mile. However, fulfillment by Amazon does lead to the additional costs of storage fees. As long as your stock sits in one of their fulfilment centers, you pay fees to the center. With a seller or company fulfilled delivery, you don’t have to worry about the fees you pay to the third party fulfilment center, but will be responsible for all dispatch costs and logistics.

Efficiency

Route optimization is an essential part of successful last-mile deliveries. Enabling drivers to view upcoming obstacles and delays will make it much easier to meet delivery deadlines. Inventory management will also allow drivers to have eyes on their goods, allowing for better route planning.

Transparency

Customers value transparency in the last-mile; in 2020 international supermarket retailer Tesco increased its delivery slots from 600,000 a week from 1.4 million due to the increase in demand for delivery time slots. To meet the challenge of demand, companies like Amazon also arrange collection lockers, so that customers can pick up packages at their convenience.

How can Less platform resolve these issues?

How can Less platform resolve these issues?

Less is enterprise-grade, cloud-managed distribution management software. Less can reduce the costs traditionally spent on last-mile deliveries by streamlining route planning and optimization to increase efficiency and meet same-day delivery deadlines. Drivers can effectively manage orders with real-time ETAs and easily track goods for deliveries. Make the last-mile deliveries on time and with minimal vehicles, saving you costs on overheads while still meeting customer demand.

Resolve last-mile logistics challenges with Less.

The last-mile is the most expensive and high-demand link in the supply chain. Even the smallest delays in the supply chain can jeopardize a delivery and lose producers an order. That’s why Less as a distribution management software can play an essential role by reducing your costs and boosting your delivery transparencies in order to meet the expectations of the consumer. Request a demo today to find out how Less can help you make more out of your last-mile logistics management.

 

Author
Vardan Markosyan is the CEO at Less® Platform
MBA from the University of Chicago Booth School of Business
PhD in Economics from the Institute of Economy of NAS RA
He spent decades of research and consultancy on business process optimization and system design


How to plan and track package deliveries using your own fleet?

Types of package deliveries

The majority of package deliveries are done by Couriers and Local Delivery Service companies. This industry comprises two segments: larger couriers and smaller local delivery companies. Together, these segments cater to various consumers, with demand for each segment differing based on the services offered. Specifically, downstream demand for courier services stems from manufacturers and retailers across the country, while demand for local delivery services is derived from households and other local markets. Although the markets for each segment differ, demand for each segment tends to fluctuate in line with consumer spending, the number of businesses, and e-commerce sales, all of which have increased over most of the five years to 2020. The U.S. market size, measured by revenue, of the Couriers & Local Delivery Services industry is $115.7bn in 2020 and it is expected to grow at an average of 5% a year for the next 5 years1.

Planning and tracking package deliveries can be challenging using your own fleet. As a fleet manager, you’ll need sufficient visibility to ensure the efficient running of the delivery process. Nowadays many businesses are relying on technological solutions such as route planning and fleet management software. This innovative technology has revolutionized the way businesses plan, deliver and track deliveries. There are several advanced features of fleet management software and it provides businesses with many insights based on delivery data.

Many types of businesses offer deliveries across a range of industries. There are also more on demand services and next day delivery options. More people are relying on deliveries and companies need to offer the most efficient service in order to keep up with competitors. It is designed to help automate and streamline processes and reduce costs. It also enables fleet managers to find new ways to improve customer satisfaction, and optimize their delivery service.

Types of package deliveries

There are different types of package deliveries. Companies are competing to provide fast and efficient deliveries, and some of the new services include:

  • On demand
    On demand deliveries are those that arrive very quickly, or in a matter of hours. Customers can expect to order something and receive it on the same day, often depending on time restrictions. The global on demand delivery market is on the rise and predicted significant growth in the coming years.
  • Next day
    Next day delivery arrives the following day, in theory. It’s challenging for many small businesses to manage and there are many cost factors and other issues. A company needs to consider the amount of packages and their destinations, plus the amount of vehicles and workers needed in order to break even.

Delivery services require quick and detailed planning, especially the more short notice they are. Route planning and fleet tracking software can help businesses deliver goods faster. Fleet managers are able to monitor traffic, locate drivers, optimize fuel usage, and improve safety. It also reduces the risk of delivery failure or delays, helping to build a better reputation for the company.

Who is involved

Businesses of all sizes and across many sectors are now offering deliveries. The fulfillment process involves a number of people at different stages. Order fulfillment starts with the receiving of the goods, short-term storage, usually in a distribution center or warehouse, followed by picking and packaging, shipping and logistics. This process involves different types of workers in order to sort, store, package, and deliver the products.

Many smaller businesses outsource their fulfillment to a third-party, whereas other larger companies use their own fleet. A fleet manager is in charge of overseeing all deliveries and they hire drivers and vehicles to carry out the process.

International couriers vs own fleet deliveries

Certain businesses may also use international couriers. International couriers, such as UPS, FedEX and DHL are third-party organizations which take care of a company’s deliveries, especially to other countries. There are pros and cons of using a courier rather than your own fleet. If you manage your own fleet, you are more in control or your supply chain and transportation operations. The challenge is covering the cost, however, and providing an efficient enough service to keep up with today’s standards.

There is an increasing demand for quicker deliveries at competitive rates. If you choose to manage your own fleet, you need to optimize each stage of the supply chain process. This isn’t only limited to transportation, but also fleet management, vehicle maintenance, and logistics. You also need to recruit, train, and manage drivers.

Over 2.5 million commercially owned fleets are used in the US alone, along with rental trucks and other vehicles. There is clearly the need for state-of-the-art solutions to help private businesses manage their fleets. Fleet planning and tracking tools are becoming more advanced with many automated features. This has made it easier for businesses to plan and track package deliveries using their own fleets rather than working with a third-party courier.

Planning and tracking tools and technologies

Planning and tracking tools and technologies

New planning and tracking tools allow businesses to monitor their fleets and analyze any relevant data. Comprehensive delivery management software for packages deliveries can cover a number of areas. There are key features such as route planning, GPS tracking, driver hours compliance, route performance and fuel consumption monitoring, and maintenance and safety controls. It also provides useful insights based on the data it collates, enabling businesses to make improvements to their delivery services.

Choosing the best package delivery software for your business depends on your own unique requirements. It’s important to opt for the right tools that are easy to use and that are compatible with other applications you may use for your business. Fleet management software tuned for package deliveries is designed to make your life easier and to save you time and money. Here are some of the main features for you to prioritize for your business.

Next day route planning

There are many benefits of offering next day delivery. For Ecommerce, it’s a big incentive for customers. Slower delivery options could push customers to use their competitors instead. Packages for next day delivery are sent separately and the routes need detailed planning to ensure they are optimized in such a short timeframe.  Less Platform’s route planning algorithms proprietary algorithm help to create the most efficient routes for you by using order specific and external data (traffic conditions, weather etc.). If you’re traveling to multiple destinations it will put these into the most logical order, depending on updated information. This is especially useful for next day delivery when you’re on the clock.

Dynamic route planning

Dynamic route planning is a fully automated feature that uses data mapping to give you the best routes in seconds. It takes into account live traffic and road conditions and updates all the information in real-time. It’s an effective strategy for fleet management because fleet managers and drivers know that conditions can change. The best route depends on a variety of factors. With dynamic route planning, businesses can also respond better to customers’ requests, for example, a change to the delivery time.

Drivers are informed automatically in real-time and are given updated directions to the new route. The route planning technology is also constant learning and offers drivers the most fuel-efficient and timely delivery options. This allows businesses to better predict departure and arrival times and notify the customer of more accurate timeframes. Dynamic route planning is one of the most important innovations in delivery technology. Delivery automation has been very effective for businesses in many industries.

Live management

One of the most important features in Less Platform’s fleet management software is the live management features. These give fleet managers the information they need in real-time and facilitate communication with drivers. Some live management features include:

  • Operational dashboard
    The operational dashboard interface monitors and manages operations. Route planning software is cloud-based, so all users from the fleet manager to the driver can have access to all the information they need, and also share data and communicate.
  • Stop trucking
    The fleet management and route planning software monitors all truck stops and driver hours and compliance. Advance geofencing functional helps to know exactly when drivers approach or leave the location. It also generates updated ETA’s for every stop, helps drivers to navigate, and notify customers about the arrival.
  • Driver communication
    Fleet management software includes a driver’s app allowing them to stay in contact with the fleet manager at all times without additional phone calls.

Electronic POD

Electronic proof of delivery (POD) provides complete visibility of delivery operations. Businesses can send accurate consignment details to their fleet drivers and customers. These include waiting times, arrival times, and the exact delivery time. The feature is also customizable and allows delivery drivers to take electronic signatures in some cases. You can configure the electronic POD feature so that your drivers and customers have access to the information they need. You can also automate the sending of PODs.

Reporting and analytics

The great thing about Less Platforms 3600 package delivery software is that it provides data insights based on reporting and analytics. It analyzes the efficiency of routes, driver performance, late deliveries and many other aggregated statistics. The fleet manager receives reports on driver performance and can pinpoint any possible causes of accidents and prevent them.

Less Platform also reports load and empty mileage and miles saved. Fuel consumption is a major cost for businesses offering delivery services. Data analytics provide the fleet manager with reports according to each individual driver so they can help reduce driving costs.

There are several key features that allow fleet managers to automate many processes. It enables businesses to streamline their entire fulfillment. These results in improved accuracy of delivery times and increased customer satisfaction. Many types of businesses could benefit from the use of this software to plan and track their own fleet. It’s an effective solution to prevent any setbacks or challenges deliveries and transportation can bring. The latest in Less Platform provides businesses with the insights they need to improve their fulfilment at every stage of the process.

Author
Vardan Markosyan is the CEO at Less® Platform
MBA from the University of Chicago Booth School of Business
PhD in Economics from the Institute of Economy of NAS RA
He spent decades of research and consultancy on business process optimization and system design