New technology and growing demand for quick delivery of goods has placed pressure to optimize the efficiencies of the supply chain model. Last mile logistics is the step where the final product is delivered to the customer. The efficiency of this step is critical because it is one of the most important components of the transportation network, making up to 28 percent of the total cost. Although the name suggests that it is the “last mile” of the process, this final step can be as short as a couple of blocks to as long as 100 miles.
It is important to have an effective next day delivery process in order to obtain and maintain a competitive advantage. Advancing technology has set a new expectation of next day delivery and strategically planning your last mile delivery process plays an important role achieving this standard. There are many challenges that must be overcome to achieve an effective process.
Urban deliveries can be difficult because of parking regulations and traffic, while global delivery can dramatically raise the cost of the last mile logistics cost. Route optimization plays an important role in resolving this issue. Understanding which roads are experiencing peak traffic at which time, and which streets may be closed or blocked due to events or construction can greatly decrease time stuck in traffic.
Another challenge is capacity at warehouses and in transportation vehicles. Driver shortages and ineffective warehouse management systems are a big part of the problem. Companies and shippers can implement updated warehouse management systems, like those mentioned in previous blogs, and offer better incentives and opportunities to truckers to resolve some of the capacity problems.
The last challenge that last mile delivery encounters is inefficiencies in other places of the supply chain. In order to remain competitive, it is important that every step of the process is at the most efficient capacity possible. When you trust G&T Enterprises with your Chicago and Midwest rail and transportation services, you can be assured that you are in good hands and the efficiency of your supply chain is our priority. Contact us today to learn more!