Many companies consider last mile deliveries to be the end-of-the-line for transactions. And that’s true. But last mile delivery logistics cannot be last on your list of priorities because it’s arguably the most important because it’s when contact is made with the customer. All the moving parts needed to get the package to that point don’t mean as much to the customer as the experience with last mile delivery.

The challenge for businesses is that same-day and next-day deliveries are no longer perks – but expectations.

Last Mile Delivery – Defined

Last mile delivery – also known as last-mile logistics – is the last leg of the journey. It’s basically the transport of goods from a distribution hub (such as a warehouse) to its destination of final delivery, usually someone’s home or business.

The goal is to facilitate these end user deliveries as fast as possible, while still providing exceptional service. Accomplishing this is one of the most expensive and time-consuming elements of the shipping process when you factor in labor costs, fleet costs, route optimization, and warehousing.

Fast-Tracking Last Mile Deliveries

As our Cleveland last mile delivery services professionals can explain, deliveries have been getting substantially faster in recent years. A recent report on the “State of Last Mile” revealed that the average timespan between someone placing an order and final delivery of that order went from 5.6 days in April 2022 to 4 days in April 2023.

Some shipping and logistics experts say at this point, companies need to be aiming for a 4-6 day average for end-to-end fulfillment if they hope to stay competitive.

But is it possible to speed it up even further? Industry insiders are skeptical, particularly because some of the factors that drove delivery times to excel so rapidly in the first place are waning.

The pandemic had a lot to do with why we saw such sharp acceleration of shipment and delivery times. In 2020, e-commerce sales shot up by 43 percent. Realistically, the consumer trend was heading that direction anyway.

The unique conditions stemming from the Covid-19 pandemic propelled shipping and logistics companies to invest in a number of measures to expedite deliveries at a time when fulfillment speed was crawling and demand was high.

Now that things have sort of evened out again, shippers still have:

• Broader capacity, with fewer constraints that challenged service in the early days of the pandemic.
• A diversified carrier mix, allowing them to seize on delivery providers that have a variety of advantages in various lanes.
• More warehouse space to keep inventory closer to final delivery destinations.

All this has meant consumers continue to expect ever-faster deliveries. In turn, businesses have had to prioritize quicker turnaround times for fulfillment to stay competitive. And that remains true. However, it’s unlikely we’re going to see this same degree of acceleration continuing as we have over the last few years.

Factors That Could Slow Delivery Times

Even if deliveries don’t get any slower, they may not get a whole lot faster any time soon.

For one thing, inflation is doing a number on a lot of consumers and businesses, and some are finding that they’re fine to hold off a little longer if it means not paying less in shipping fees.

And then to further cut down on shipping fees, many are shifting to ground transportation – which is generally cheaper than air cargo. But that means end-to-end turnaround time is closer to 3-5 days for last mile delivery, compared to 1-2 days that some consumers are used to. With the options available at this point, trying to facilitate deliveries any faster than that can get pricey.

Keeping Cleveland Last Mile Delivery Costs in Check

Investment in accurate demand forecasting – whether with software or consulting – can go a long way toward helping companies deliver both promptly and profitably. As longtime logistical experts, our team at On Time Delivery & Warehouse knows that if you can ascertain how much you’re going to need – and where/when you’re going to need it – you can make arrangements for your inventory to be closer to its final shipping destination, and ultimately cut costs.

Efficient route planning is another way to reduce delivery costs. If you’re using trucking/ground transportation, drivers need to be equipped with routes that minimize delays. This is especially important with last mile deliveries because drivers are often navigating residential areas and/or crowded commercial districts. Knowing which roads to avoid at what times can significantly minimize hold ups.

Another way to keep last mile delivery costs reasonable is to set minimum order quantities (MOQ). This is the fewest number of units that manufacturers or suppliers require a customer to purchase in a single order. While many companies hesitate to take this step, it’s a practice helps companies avoid wasting resources on orders that yield little-to-no profit.

Ultimately, suppliers need to strike a balance between meeting the expectations of their consumers and keeping last mile delivery costs reasonable. Hiring a third-party logistics company can go a long way toward ensuring that your supply chain is streamlined and you’re employing resources most effectively.

For information on our Northeast Ohio 3PL services, Contact On Time Delivery & Warehouse by calling (440) 826-4630 or send us an email.

Additional Resources:

Deliveries keep getting faster. Will it last? June 12, 2023, By Max Garland, Supply Chain Dive

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Minimize Midwest Freight Fraud by Working With Trusted Cleveland 3PL, May 15, 2023, Last Mile Delivery Services Cleveland Blog