As managing supply chains remains challenging, many retailers have had to embrace new processes to improve their last-mile operations. The digitalisation of processes, such as automated demand planning and forecasting, has helped retailers perfect their inventory management and allowed them to meet demand during peak times as well as reduce waste during quieter periods. As a result, retailers are actively involved in digitalising processes related to their last-mile operations.
Technology and digitalisation enable organisations to enhance their delivery processes to reduce costs and create superior customer experiences. Digitalisation remains crucial for retailers to develop cost-effective last-mile solutions across multiple challenges, such as lack of visibility, poor communication between players and unreliable data.
What are European retailers focussed on improving?
A recent FarEye survey of European retailers found that the top three key performance indicators (KPIs) retailers focus on improving include: cost-per-delivery (58%), customer satisfaction (56%) and visibility and tracking (46%).
A retailer has to rely on a superior delivery experience to keep consumers happy. Consumers now demand free or low-cost shipping, exceptional delivery speed and order visibility. Customers unhappy with their delivery or return experience can significantly impact a company’s reputation and future sales. So while cost-per-delivery is essential, providing cost-efficient deliveries while keeping customers happy is the end goal.
The Visibility Challenge
According to one study, 98% of supply chain professionals face a lack of visibility of their supply chain. Visibility impacts inventory, the movement of goods, and the consumer’s ability to see where their packages are. As a result, retailers will benefit from improved visibility throughout their supply chain.
Last-mile delivery technology provides visibility, whether between the transfer of goods from mid-mile to last mile or allowing logistics managers to know where a product is in the last mile with the ability to intercede if exceptions crop up.
Visibility is also essential for quality customer experiences. Consumers want to be able to track where their packages are in the delivery process and change delivery times and dates if needed. Therefore, visibility and tracking are important for supply chain management across the board.
Last-mile technology brings real-time visibility and allows companies to track shipments in multi-modal supply chain operations while also providing visibility to the end consumer, which is highly expected today.
Last-mile Delivery Brings Complexity
With the rapid growth in e-commerce, retailers are diversifying and outsourcing their delivery networks, partnering with couriers, gig fleets and postal services to enhance their customer service. Outsourcing allows retailers to be more flexible and increase their capacity and scalability while allowing for speedier deliveries. It also helps retailers fulfil customers’ needs while making last-mile delivery more complex and less branded.
Handing last-mile deliveries to an outsourced delivery fleet means retailers must relinquish control over the customer experience. For today’s retailers, simplifying the complexity around deliveries and returns while gaining control over delivery fleets, whether owned or outsourced, is vital.
Four Biggest Challenges with Outsourced Delivery Networks
Retailers have identified the top four challenges they experience with outsourced delivery networks. Using last-mile delivery technology platforms can help mitigate these challenges, which are:
1. High Costs
Technology that provides multi-carrier shipping and rate-card management helps retailers obtain a clear view of what various carriers charge, enabling them to choose the most cost-effective and efficient carriers through preset criteria in the software.
2. Inaccurate Tracking Information
Accurate tracking information is possible through the use of technology. Advanced last-mile delivery technology improves communication and tracking by uniting multiple carriers and delivery fleets onto one technology platform. An integrated last-mile tracking solution helps visibility challenges by providing real-time visibility of shipments from order to door.
3. Lack of Reliable Data from Carriers
Knowing where goods are in real time allows dispatchers to predict estimated time of arrival (ETA) and forecast delays, providing the ability to add stops to a delivery route if needed.
4. Poor Delivery Quality/Poor Customer Experience
Allowing real-time communication lets shippers provide a flexible and seamless delivery experience and enables superior customer experiences that build brand confidence and loyalty, even when the delivery is outsourced.
The Bottom Line for Retailers
Retailers need to adopt last-mile delivery technology to decrease cost-per-delivery while also providing a superior customer experience. Today’s technology tackles a range of complex problems through artificial intelligence, machine learning and automation that can easily integrate with existing processes. Therefore, simplifying the last mile, making it cost-effective, and keeping an eye towards a superior customer experience is critical.
Last-mile solutions offer flexible deliveries and returns while providing real-time visibility from order to door. These solutions help reduce costs by maximising asset utilisation, optimising routing efficiency and increasing workforce productivity to make more deliveries for less cost. While supply chain management remains challenging, using last-mile delivery technology reduces the challenge while providing multiple benefits to those who adopt it.