Last Mile Logistics Explained

Published on
1/17/2024
man and woman loading cargo van with boxes

One of the most important parts of the hauling process is the final step. For small businesses and consumers alike, it’s important to understand the options you have. Let’s learn about last-mile logistics here.

What Is Last-Mile Logistics?

After a product leaves the warehouse, it will go on a long journey and change hands multiple times. The whole shipping process takes time and there are many challenges along the way.

The final piece to the logistics puzzle is referred to as the final mile of delivery, or last-mile. This final step is what people look forward to the most—where they finally get their package on their front door. For most residential shipments like small parcels, companies like UPS or FedEx are the go-to. However, for some less-than-truckload (LTL) shipments, outsourced pickup trucks or cargo vans are often used.

When we’re talking about customers in this last mile, we’re also talking about small businesses. Final-mile logistics refers to products going to a customer’s front door. But for some business applications, the customers don’t need the product. The service provider does. For example, customers paying a roofing company for a new roof don’t need roofing materials—the roofing contractors do.

This could be considered a part of middle-mile logistics—cargo going from the distribution center to the retail center. However, for some deliveries, it’s the final mile.

The Last-Mile Problem

The final step in delivery often feels like the slowest. The package is out for delivery, but it feels like it takes all day. There’s a problem with this final step in the shipping process, and it’s so common that it's simply called “the last-mile problem”.

This final step usually takes a long time, it’s not cost-effective, and it’s actually where the majority of hiccups occur.

The Time

The way last-mile logistics works is through fleet management. Shipping companies are required to conduct package organization, and route planning, and oversee the maintenance of every vehicle in their fleet. That’s a lot to manage, and each of those categories presents its challenges.

Even the best-planned routes have lots of stops with small amounts of packages. For residential customers, it’s normal to see delivery times between 9 am-6 pm. That’s a huge window and sometimes it’s not even accurate. This is also frustrating for delivery drivers. Lots of small drop stops mean they’ll have to be running a lot. 

Businesses with LTL shipments can expect the same large window but with expected delivery times ranging between multiple days. You can expect a shipment to come in one day, but there’s a good chance it won't.

Shaky delivery times can be frustrating at best and detrimental at worst. Late shipments can be annoying, but what’s even worse is when deliveries fail

There are a number of reasons why a delivery may not be able to be made: 

  • Inaccessible destination
  • Damaged packaging
  • Receiving the wrong item.

Each of these reveals supply chain issues that need to be solved.

The Cost

With the rise of Amazon Prime, customers expect to not pay for shipping. But because the supply chain is much more complex than it has ever been, shipments are more expensive. 

53% of shipping costs come from the list-mile of delivery. This final piece of getting a customer their shipment is typically the shortest distance traveled, but it costs the most. 

For businesses in rural areas, the cost can increase as well because their locations are typically “out of the way” from more centralized routes.

Solving the Last-Mile Problem

As people begin to notice the issues in the supply chain, businesses are starting to clean up their final-mile delivery processes. This benefits consumers and businesses. Open Road is one of the service providers working to meet the challenges of last-mile logistics.

Use a Hotshot Trucking to Get Your Materials Delivered

Hotshot drivers don’t have to wait in order to fill their trucks, and they don’t have to make a bunch of stops along the way. Most pickup trucks can haul LTL shipments. 

Certain online retailers are already implementing this. The “pickup in-store” option most retailers offer is very similar to independent hotshot drivers.

For small businesses, this option is cheaper and quicker. Instead of relying on unreliable shipping companies, hotshot drivers can get the job done quickly.

Turn to Streamlined Technology

Technology plays an important role in route planning and fleet management. Easy-to-use last-mile technology is an important aspect of a smooth shipping experience. The Open Road app eliminates some of the complicated inefficiencies of regular freight. It also cuts the fat and only includes people who need to be involved in the shipping process.

The only three people involved in Open Road’s process are the shipper, receiver, and driver. This means there’s a lower chance of complications during the process. This is a lot different than other common delivery options. Open Road lets businesses oversee the whole process including driver tracking. Reach out today to find solutions to your small business shipping needs.

Streamlining the processes for delivering LTL can solve several problems. The more inefficiencies that can be ironed out, the quicker, and better shipments will be. Some problems solved by having a streamlined last-mile process will include:

  • Package tracking and delay reporting
  • Communication with the driver
  • Efficient routes
  • Ensuring the safety of your materials
  • Adherence to deadlines

When Timing is Everything

Sometimes, your materials are nearby enough that it’s not worth the headache of delivery, but you can’t waste the day going to get it yourself. Open Road gives you the ability to ship your materials without having to wait for freight or other inconsistent delivery methods.

Open Road is the best solution for the last-mile problem in the Southwest. Small businesses can rely on our resources to get what they need when they need it. Contact us to get started today.

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