Last Mile Delivery: Challenges, Solutions & How to Optimize it

Nowadays, customers expect real-time tracking of their shipments. They want to monitor their package; from the moment it is loaded into the delivery vehicle until it is delivered to their doorstep.

Our route optimization software provides you with the ability to calculate an ETA, constantly update it and send it to all participants of the supply chain, including your customers.

With a software solution optimizing your last mile logistics, you can offer your customers shorter time windows for delivery. When they no longer have to wait for hours for a delivery, overall satisfaction is improved, and customer retention is increased. Being on time also raises the number of successful first delivery attempts.

Route optimization tools can help your dispatchers find the most efficient route, avoid congestion and reduce idle time. This in turn reduces overall fuel consumption, transport costs and CO₂ emissions

Even the best route planning does not protect against unforeseen events: an accident on the route, a technical defect in the vehicle, or an urgent last-minute order. To avoid the resulting delays and rising costs, flexibility is needed. The dispatcher can send an updated ETA from the system, add new orders to a route via drag-and-drop, or redistribute the shipments to another vehicle. With just a few clicks, the route is reoptimized in real time.

To prevent empty runs and low loads, it’s important to assign the right type of vehicle to your last mile deliveries. With PTV’s solutions, vehicle profiles are created and tailored to your fleet. These vehicle profiles are considered during the planning stage. In addition, the software optimizes the loading capacities and ensures better utilization of the vehicles. 

When no one is at home, the driver has to return without delivering and to try again the next day. While this scenario cannot be completely avoided, its occurrence can be significantly reduced. Our routing and route planning solutions can be used to send a precise ETA directly to the customer. To increase reliability, the ETA calculation includes historical traffic data, construction sites, driving and rest times, and vehicle-specific average speeds. 

Last mile refers to the final stage of a supply chain. It’s the final delivery to the end customer. The last mile is usually costly and complex due to various factors that need to be considered, such as delivery windows, traffic, or vehicle limitations. However, it’s a crucial factor to get right, in delivering a great customer experience.

The last mile is expensive for transportation service providers. There are many reasons for this, including increased demand and smaller delivery volumes, high fuel consumption due to stop-and-go in inner-city traffic, high rates of failed delivery attempts and inefficient delivery routes.

Last mile optimization is about increasing the efficiency of the last mile delivery. The benefits of last mile optimization are reducing transport cost, increasing delivery flexibility and decreasing CO2 emissions.

Special route planning tools help to optimize the last mile. They use algorithms that take all relevant factors into account, determine the most cost-effective routes, and ensure better vehicle utilization.

A good example of last-mile delivery is DPD Fresh. The company uses PTV software to plan and optimize its delivery routes for fresh products. Read the whole story.

The last mile delivery is the most expensive part of the supply chain. The reasons include inefficient routes, many stops with low order volumes, difficult traffic conditions and a high rate of failed delivery attempts.

Last mile delivery is rarely profitable, due to the many costs involved. However, there are ways to reduce the costs and make last mile logistics more efficient. Besides, the main goals of the last mile are not profitability, but successful delivery and long term customer satisfaction.

The percent of shipping cost of the last mile will depend on various factors. However, it’s been estimated that it can account for between 30 and 50% of the total delivery cost. The reason it’s so expensive is because parcels for the last mile need to be transported in vans instead of trucks to navigate urban roads. Moreover, the chance of failed deliveries is highest in the last mile.

By using route planning tools, such as PTV Route Optimiser, routes are being optimized in terms of efficiency, time and cost. The PTV solutions also calculate a precise ETA that can be passed on to customers reducing the number of failed delivery attempts.