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Lorcan Sheehan

The last mile

Posted by Lorcan Sheehan in ModusLink’s Value Unchained on Jul 16, 2012 1:05:00 PM

last mile blog pic“Richard Wilding is both a professor of logistics and supply chain management at Cranfield University and a victim of the parcel conundrum.

‘We were expecting a gift to arrive, and the courier firm told us it had been delivered. We told them we hadn't received anything, and the company said it had been delivered to a hedge. We haven't got a hedge.’

Some weeks later the box was discovered, sure enough in a hedge, about half a mile away from his house.”

For business to consumer deliveries, one of the most crucial parts in the Supply Chain is the last mile—actually getting the product into the customer’s hands. In most cases when shopping online the consumer has a choice of delivery methods, either by post or more costly parcel delivery options with companies such as FedEx or UPS. One of the key challenges for any of these companies is making sure the customer is at home to sign and collect for the delivery. In many cases a missed delivery note is left at the consumer’s address and the company will either tell the customer they can collect the parcel at a local depot or they will attempt to redeliver the next day.

According to a BBC report http://www.bbc.co.uk/news/magazine-18709348 12% of parcel deliveries fail the first time. This is very costly for the logistics companies and very frustrating from a customer point of view. This reports lists a number of ways in which the first time fail rate can be reduced including:

  • Incentivising the drivers: In many cases drivers see a successful delivery as leaving a “sorry we missed you” note. However, if there is an incentive in place, the driver might make further efforts to contact the customer or make an alternative arrangement.
  • Track the driver: Tracking data from couriers improves the first time delivery rate, although often tracking data available is of a historical nature rather than real time. Improved systems can give real time data on the location of the van to the customer on their smartphone.
  • Where's my customer? Smartphone apps could help couriers locate their client – companies like Blackbay provide apps that can update customer locations and reroute the drivers to new locations.
  • Delivery consolidation: Companies are starting to deliver to a consolidator's address. They hold onto parcels and re-deliver them to the client.
  • Lock boxes: Storage boxes with pin code entry outside people's homes or in convenient locations such as train stations are a novel solution. DHL has “Pick Up and Drop Off” or “PUDO” points all over Germany that assist with deliveries.
  • No signature: With GPS location stamping, a driver can prove they were at your property, and even take a photo of the place they have left your parcel.
  • Convenience shops: Increasingly, local shops with late hours will take delivery of parcels. Many companies are taking advantage of this. Kiala is a Belgium-based parcel delivery firm that specialises in convenience store drop off and collect points. Kiala was recently acquired by UPS.
  • Keep the customer in loop: Automated text messages and emails can let people know where their delivery is and sharing of contact data with drivers and call centers can also improve the process.
  • Neighbour delivery: It is refreshingly old-fashioned and can build a sense of community. 
  • Place of employment: Many firms will take personal deliveries for staff.

Overall, while the missed first time delivery is a costly process that frustrates the customer, there are a wide variety of creative solutions. It’s important for consumer goods companies, couriers and customers to choose the right delivery method that reflects the desired customer experience for the products.



Originally posted by Eoghan Dillon at http://blog.moduslink.com/bid/77053/The-last-mile

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