First mile delivery optimization lays down a strong foundation that ultimately creates happy customers. How do you make sure your products start their journey off right?
First Mile Delivery Optimization
Compared to last mile delivery, first mile delivery isn’t getting nearly as much attention or resource investment to improve efficiency and visibility. You would think the first step in the delivery of your products would carry weight, and it does.
Being the initial leg of the journey an item will make in an individual company’s supply chain process, optimizing first mile delivery helps ensure customers are not lost due to unmet expectations, low standards or inconsistencies.
Additionally, there are the obvious benefits that come with having a better understanding of your operations which through the process of analysis, uncover opportunities to improve.
What is first mile delivery?
As the official kick-off to the transportation of goods across the first leg of the supply chain, the first mile could also mean different things for different industries and supply chains.
For example, as a retailer this could be delivering items from a regional warehouse to local stores or a local distribution centre. For logistics services, this could be the picking up of goods, and either:
- bring them back to their own warehouses (i.e. next day/distribution model) before the next leg of shipping or
- provide a same day or on-demand service – where LSPs pick up the order from the shipper, which then go out for immediate delivery to the consignee
As another example, the first mile for a moving and storage company would involve the pickup from the customer’s home or store, then delivery of the inventory back to the warehouse or storage site.
Or it could be something as simple as an eCommerce merchant dropping off individually packaged and addressed products at the local post office for the next link in the delivery chain.
In both cases, it involves loading and unloading shipments. It can also involve different drivers managing the same items, and items with more than one order ID – such items are often resolved manually by many 3pls.
Optimizing First Mile Logistics
Automation is the key to optimizing first-mile logistics processes. By applying the right technology, excess expenses can be converted into funds that help propel growth.
By examining first-mile operations through the lens of lean performance, opportunities can be realized such as more efficient truck loading and more predictable delivery times at the last mile of the supply chain.
Smart manufacturers take advantage of any opportunity to assess logistics and find ways to improve the speed of getting products to consumers. A deeper understanding of inter-logistical operations can produce wins such as better price-points for their customers, and a more competitive edge in the market.
From a human input standpoint, auditing tasks of the company’s workforce can provide insight into how hands-on tasks may become automated ones. And instead of being interpreted as lost jobs, these operational savings can be used to boost employee satisfaction by being seen as promotions in assigning them new and more complex tasks.
First Mile Delivery Processes and Hurdles
From the time a product is packaged and ready to enter the supply chain process, it begins its journey through the first mile of delivery. Here are a few of the most important elements to consider:
Visibility
Once a service provider takes a truckload from its warehouse, there is zero visibility as to where the order is without some form of tracking technology. This is particularly problematic for shippers of big and bulky goods, fragile, or expensive items.
What is First Mile Tracking?
First mile tracking refers to the status and location of orders from the retailer or manufacturer’s warehouse to a specified distribution centre or local fulfillment centres.
For logistics providers, first mile tracking can be the transfer of products from a retailer’s distribution centre to the provider’s own warehouse, prior to last mile delivery.
To offer more competitive services to shippers, it’s important to look at the entire delivery experience holistically. That is, from the shipper’s perspective starting with the first mile, as well as the customer’s ending with the last mile.
Today, it’s possible to update your first mile shipping and first mile delivery experience using many of the same techniques that are applied to last mile delivery.
Inexperience
In the larger sense, shippers are customers too, and expect a great experience from their service providers – so why not give them the same treatment when their business orders are shipped?
With the boom in eCommerce, businesses have been paying close attention to the last mile in recent years. In order to stay competitive in the online landscape, businesses have rushed to overhaul and expand their last mile fulfillment services.
In comparison, nothing substantial has happened in the first mile world. From the perspective of the full delivery experience, the first mile has been largely ignored. This is more due to the fact that product origination could be thought of like the trunk of a tree; a singular point of origination, whereas the points of destination would be the branches or even individual leaves in the case of absolute end-users.
However, it’s important to realize every aspect of the delivery experience plays a part in creating customer stickiness.
Technology and Digitization
For many, first mile delivery processes such as coordinating pickup times and matching shipment size to truck availability can be improved by digitizing the first mile delivery flow.
Larger companies have technology for optimizing first mile logistics. Small companies on the other hand, may have to adopt transformational processes, moving their entire supply chain from manual to more efficient digital operations. Depending on a company’s size, this can take more time and resources than they have available.
Can You Outsource First-Mile Delivery?
The short answer is yes. Unless your company also has its own fleet of delivery vehicles, the first mile is typically handled by suppliers and facilities through external third party carriers.
How Long Does First-Mile Delivery Take?
The time it takes to accomplish the first mile delivery will depend on how far your supplier is to your warehouse or fulfillment centre. It will also depend on the shipping method used.
How Much Does First-Mile Delivery Cost?
First mile delivery costs will depend on the size and type of your inventory and the shipping method used to transport it. First mile delivery optimization involves using cost-effective methods of ordering only as much inventory as you need, or shipping in bulk based on forecasted demand. This reduces the amount of overall capital associated with moving the inventory.