What Is Last Mile Delivery? Challenges, Costs, & More

Last mile delivery refers to the transportation process from a distribution center to customers’ front doors. People also call it last mile logistics. Its goal is to provide goods quickly, affordably, and reliably. Companies like Amazon have revolutionized online retail distribution through last mile logistics, but this transformation doesn’t come without a price. Last mile delivery has challenges, costs, and more that come from a product’s delivery accounting for more than half of shipping costs and route complexity for delivery trucks. Gain insight into last mile delivery and how the process impacts retail distributors.

Lower Speed

The local road and traffic situation affects the average speed of product deliveries. Interrupted routes, especially in urban areas, significantly impact a fleet’s average speed and fuel efficiency.

Failed Deliveries

Distributing goods to a fulfillment center or chain partner doesn’t have the same risk of failed deliveries as delivering to a customer. Inaccurate shipping, especially e-commerce shipping, requires prioritization. Otherwise, the result is costly.

Complex Routes

Last mile delivery caters to a broad number of individuals in various locations. Last mile delivery welcomes complex routes for reaching each customer’s doorstep. Unfortunately, this can lead to more out-of-route miles. A business has more out-of-route miles when it spends mileage on its delivery fleet without compensation.

Returns and Discounts

Last mile delivery has posed a new challenge for e-commerce fulfillment by increasing the average return rate. If a retail distributor sells online, it must logistically account for returned items. The returns, refunds, and additional discounts for exchanged items have a real business impact on last mile delivery.

Now you know what last mile delivery is and its potential challenges, costs, and more. Investing in high-quality vehicles, such as beverage delivery trucks, is a critical first step for benefiting retail transportation. Emerald Transportation Solutions is your one-stop shop for all your delivery vehicle needs. Explore our broad selection of insulated trucks, vans, and reefers to optimize your transportation process.