Combating Last Mile Delivery Issues
We live in a culture of instant gratification, where companies battle each other to provide cheaper products and faster service. Enter last-mile deliveries. Instead of shipping products from a central hub, last-mile delivery transports products from a warehouse or distribution center close to the customer directly to their doorstep for faster, cheaper delivery. At least– that’s the intention. In practice, last-mile logistics are complicated and expensive, resulting in last-mile costs accounting for over 40% of the entire supply chain. So what can you do to make last-mile work for you.
The Last Mile Delivery Problem
In theory, last-mile delivery should ensure faster deliveries for customers. However, these three key problems keep this method from running smoothly.
Cost
Over the past year, last-mile delivery has faced revoked service guarantees and rising costs due to the pandemic. While some service guarantees have been reinstated, they don’t apply to all deliveries, and FedEx recently added new surcharges and peak delivery fees.
Failed Deliveries
A 2018 survey revealed that 66% of US-based shoppers are impacted by late or failed deliveries, costing eCommerce retailers $216,171 on average. When shipments are late or lost, both the customer and the retailer are negatively impacted.
Inventory Issues
As the global share of eCommerce trade increased from 14% to 17% during COVID, shipments were leaving warehouses at an unprecedented rate. As warehouse managers struggled to keep up with demand, inventory issues delayed shipments, leading to late deliveries.
The Last Mile Delivery Solutions
While there’s not much you can do about fuel costs or pandemic-related shortages, there are steps you can take to increase customer satisfaction and decrease your costs.
Incorporate Tech
Modern problems require modern solutions. Consider investing in AI and machine learning technologies to streamline your shipping process, track progress, optimize the route, and stay organized. Check out this article on how you can incorporate tech to reduce shipping costs.
Increase Customer Communication
Communication is key. When your customer places their order, be sure to provide tracking information and offer delivery windows to decrease the likelihood of a failed delivery. The average cost of a failed delivery is $17.78, which falls on the retailer. Maintain channels of communication to decrease failed deliveries.
Negotiate Your Contract
If your contract dates to pre-pandemic times, it can most likely benefit from a refresh. The team at ShipRx began their careers building contracts for the carriers. Now, we use that knowledge to renegotiate contracts for businesses just like yours.
No matter your shipping strategy, ShipRx has you covered with the contract negotiations, parcel audits, and expert consultation. Get in touch with us today and start saving!
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