As mentioned, last mile carriers deliver the product from an intermediate shipping center to the final destination. But as straightforward as that sounds, there are a host of things that can go wrong in this phase, which not only leads to mounting expenses but damages credibility and impacts your brand negatively. Here are some of the major issues that ecommerce businesses face:
Return of orders and subsequent rise in logistical costs
Cancellation of orders is common in ecommerce, but one of the major reasons why customers return orders is due to errors in the last mile delivery process. Whether it is late deliveries, not being able to track packages accurately, delivering damaged goods, and misplacing packages – each of them could contribute to more returns. These incidents usually happen due to the negligence of the ecommerce companies or lack of advanced technologies. When more customers start returning orders, the logistics expenditures shoot up, which in turn affects market share and customer loyalty.
Returning orders to origin
Sellers face a key issue when it comes to “return to origin”. It means sending the order back to the seller in case of failed deliveries. It could happen because of wrong addresses being mentioned, no one available to accept deliveries, customer refuses to accept the order, etc. It means extra re-shipping costs.
Not able to meet rising demands
With the advent of faster internet connectivity, e-commerce demands have been rising sharply. This is another area where last-mile delivery faces hurdles. The fulfillment center of the 3PL partner might be far away from the delivery location. The interconnectivity between them can affect delivery speeds. Companies such as Flipkart and Amazon are trying to resolve this issue by collaborating with local retailers and creating pickup points from where customers can collect orders. The more remote the location, the tougher it becomes to execute successful last-mile deliveries.
Customer experience is what matters
The competition in the eCommerce market is fierce and constantly expanding. To retain customer loyalty, brands and last-mile logistics providers must provide an exceptional delivery experience. For instance, Amazon is consistently exceeding customer expectations and raising the bar for others. Apart from offering one-day delivery, it also came up with 2-hour deliveries applicable on certain merchandise available only to Prime subscribers. Same-day delivery has almost become mandatory to ensure customer loyalties don’t shift. But last-mile delivery became so expensive for the eCommerce behemoth that it decided to build its in-house supply chain, which would be more cost-effective than outsourcing that service.
Given the benchmarks set by Amazon, customers tend to expect similar services when they order from other eCommerce companies. Regardless of harsh weather conditions, localized lockdowns or containment zones, etc. that disrupt delivery timelines, customers want super fast deliveries – they don’t really care about challenges in last-mile delivery. They also want flexible timings and cheaper costs at their end.
White glove and contactless delivery
When it comes to last-mile deliveries, eCommerce companies need to focus on safety and convenience. Several retailers are offering premium services such as white glove deliveries for their merchandise. This type of service is generally available for high-end items or goods that are bulky – it might include delivery, installation, or assembly in a particular room of your house. With the Coronavirus pandemic still in play, customers also want contactless delivery options, where the package is left on their doorstep. This option can boost brand loyalty, and bring in more customers as well.
What can be done to improve the supply chain?
The eCommerce industry is facing a lot of uncertainly when it comes to supply and demand trends. Having decentralized inventory spread across several warehouses and demand centers across the country can help cater to a dynamic market. Smart and more informed decisions can be made by using data-driven and analytics-based solutions – this information helps you study and comprehend trends in a more efficient manner. They can guide businesses with smart inventory placement, cost optimization, etc. It is also necessary to implement better tracking solutions – it is beneficial for the end-user and businesses, as it means orders won’t get misplaced or rerouted, while delivery time frames can be maintained without hassles.
Ecommerce retailers and logistics companies need to adopt innovative last-mile practices and work towards developing solutions to provide relevant delivery options and services. It is very important to improve efficiency at each step of the delivery flow. Last-mile technologies help to make the delivery process easier than ever, thus allowing e-commerce companies to process a larger number of orders within the shortest possible time and execute more last-mile deliveries successfully.
About The Author
Neil is the Chief executive officer at Anstel Global, a SaaS-based IoT platform for connected logistics solutions that helps fleet management companies reach business objectives. He is passionate about IoT-based applications and has spent the last decade working with organizations to improve their ROI through connected logistics solutions.
