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Using technology to improve last-mile delivery

October 28, 2021
Andrii Rybakov

Last-mile delivery serves as the final phase in the network of 3PL (third-party logistic) services. As an entire ecosystem, it allows bringing ordered goods to clients’ doorsteps. Today, according to the Mordor Intelligence report, “the growing consumer preferences for faster deliveries and omnichannel retailing gaining popularity” are among the critical factors that drive the demand for such services. At the same time, modern consumers want “to track their order from the moment it leaves the warehouse to the moment it arrives on their doorstep.” 

A thorough analysis of the current logistics market, especially last-mile delivery, helps reveal three key insights:

  • The increase in consumer expectations. Now, consumers are incredibly sophisticated in their demands related to last-mile delivery. McKinsey&Company states that “20 to 25 percent of consumers would pick same-day or instant delivery if it were available at low prices.” It means they want to have the opportunity to choose from numerous ways to get the desired goods quickly and conveniently. However, they have a limited willingness to pay for such services.  
  • A high potential for automation. Thanks to automation, logistics companies can increase efficiency significantly. Emerging technologies like autonomous delivery vehicles (ADVs) will reshuffle the whole supply chain. 
  • Changes in competitive dynamics. Technological innovations promote the evolution of the entire industry and the appearance of new market players. Therefore, organizations should ensure they are equipped with the required resources and skills to remain successful in times of increased competition. 

Ultimately, the technological advancements in last-mile delivery services are happening quickly. That forces both incumbents and new entrants to respond to such changes and accelerate the implementation of cost-effective technologies. 

In this blog post, we will consider several critical ways of using technology to enhance last-mile delivery and make it more flexible. 

Mapping routes in real-time through software 

Planning is among the key factors that contribute to fast delivery. Although drivers may know the routes perfectly, the delivery often gets delayed due to various unforeseen obstacles. Therefore, you should provide your drivers with a clear plan backed up by appropriate data because they may spend time deciding which road to choose. That hinders the delivery process significantly. 

In this case, logistics companies should consider integrating last-mile delivery software, along with cloud capabilities, into their shipping operations. The particular integrations eliminate the need to do the guesswork for drivers since the system handles the routing and ensures the map data is always actual. 

With last-mile delivery software, logistics firms can plan routes by paying attention to traffic congestion, ETA (estimated time of arrival), or weather conditions. Such a data-driven approach to route mapping also makes it possible for dynamic rerouting depending on the information provided by the software system. 

By obtaining up-to-date information about weather, traffic, or stop proximity, drivers can ensure on-time delivery. Finally, organizations will get more economical routes due to less mileage and experience a reduction in fuel consumption. That allows cutting operational costs. 

Optimizing routes through big data & predictive analytics

Logistics companies often use big data and predictive analytics in tandem for mitigating general last-mile delivery tracking issues. If organizations analyze reports without an appropriate analytics system, they may spend several months revealing various disruptive patterns and missing critical data. 

However, implementing a dedicated data science system and a big data one promotes filtering information faster. These systems allow scanning thousands of deliveries, generating reports depending on GPS tracking data, and using the relevant findings for making informed decisions. For example, logistics firms can define the most fuel-efficient routes or create plans to maintain larger order volumes during particular seasons. 

In addition, they can use collected data for creating a supply chain digital tween. That allows testing and predicting the outcomes of predefined routes more accurately and, in turn, identifying last-mile delivery logistics operations that you need to improve. 

Batching SKUs automatically with auto-dispatch technology

In order to handle the on-demand delivery of some SKUs (stock-keeping units), logistics firms should apply order batching. Traditionally, such a delivery is always rushed. It means that companies have no time to batch SKUs manually. In this case, they make deliveries more frequently than necessary, which increases delivery costs. 

The particular lack of batching leads to delays since small groups of products refer to fewer orders companies fulfill per delivery window. With automated dispatching systems, firms can perform batching more accurately and quickly. Besides, batching orders appropriately, in tandem with GPS asset tracking tools, allows reducing the number of drivers companies put on the road and seeing how many goods they send. That promotes performing timely deliveries. 

In addition, auto-dispatch technology can bring new business opportunities. If organizations can cut down the number of drivers necessary for their existing delivery capacity, they will focus on expanding the geographic regions for deliveries and growing sales. 

Collecting data seamlessly through IoT-enabled sensors

Integrating supply chain operations with the cloud using IoT-enabled devices is the priority for modern logistics companies. For instance, location intelligence systems bring many benefits, ranging from tracking vehicles on the map to monitoring the entire fleet performance. 

At the same time, embedding small IoT sensors in vehicles and coupling them with fleet management software can improve the overall logistics process. Such sensors provide logistics managers with real-time data regarding the delivery schedule, its success, and various issues that may occur. If necessary, companies can also implement video telematics. Thanks to the end-to-end visibility of logistics operations, organizations can aggregate valuable data, create better routing plans, and define the existing bottlenecks within the supply chain. 

Lastly, applying IoT-enabled devices can eliminate the need for sending and verifying data manually. That helps save a lot of time since managers can transfer validated transportation permits to drivers much faster. It also means the on-time delivery of ordered goods. 

The bottom line

The Mordor Intelligence report states that “with more consumers shopping from home, last-mile delivery providers have been dealing with a spike in demand for their services.” Thus, providing drivers and vehicles with technological advancements is crucial for addressing last-mile delivery issues and making such services more efficient and flexible.  

Dedicated last-mile delivery software will allow logistics companies to maintain or achieve significant customer loyalty. Applying new technologies and integrating them deeply into supply chains enables organizations to make more deliveries. After all, according to the World Economic Forum report, “there will be a 78% increase in last-mile deliveries in urban areas across the world” by 2030, thanks to adopting technological innovations. 

How AgileVision can help

Over the past several years, AgileVision has helped many logistics firms improve their last-mile delivery services and improve overall efficiency. Are you considering applying new technological solutions or need some advice on your current ones? 

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