Last Mile Logistics – Facts you should know

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The Middle Mile area in particular has continually increased the demands on logistics:

With the concept of bringing the goods to the buyer faster and faster, digital platforms (see also below), like Amazon, push the life nerve of a time. So far, the online shop also bubbled after the “actual” and conventional sales channel as a multi or cross-channel, the simple idea of ​​“fast” delivery catapulted e-commerce into the Champions League to the lead.

Middle Mile E-Commerce – Image: Xpert.Digital

Suitable for:

• Well equipped for unified commerce or no-line commerce

The payment methods became more diverse and easier. Likewise, the processing for consumers and sellers became easier. It had to go quickly and easily. The products had to be searched and found quickly and easily. The order and handling had to be made quickly and easily. Quickly the delivery. The simple USP (Unique Selling Point) for success and e-commerce was born: “speed”!

Transfigured image of the pure-play e-commerce business model – Image: CuteCute|shutterstock.com

With the digital platforms, especially Amazon, the pure players sprouted like mushrooms. In the area of ​​e-commerce, “ Pure Play ” refers to a business model where goods or services are sold or delivered only via the Internet without a physical store.

As a rule, they do not deal with the delivery of packages themselves, but generally leave this to the CEP services, fulfillment service providers or Amazon itself: Fulfillment by Amazon (FBA).

In the FBM – Fulfillment by Merchant area, people also rely on the CEP services.

The last mile is a term used in supply chain management and transport planning to describe the movement of people and goods from a traffic junction to a final goal. The term “last mile” was taken over by the telecommunications industry, which had difficulty connecting individual households to the main telecommunications network.

Similarly, in supply chain management, the last mile describes the difficulty of transporting people and packages from hubs to final destinations. Last-mile delivery is an increasingly studied area as the number of business-to-consumer (B2C) deliveries increases, particularly from e-commerce companies in freight transportation and ride-hailing companies in passenger transportation.

The challenges of last mile delivery include minimizing costs, ensuring transparency, increasing efficiency and improving infrastructure.

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Trends in the courier, express and parcel industry (CEP) – PDF download

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Last mile logistics worldwide – PDF Download

“Last mile” was originally used in the telecommunications industry to describe the difficulty of connecting private households and companies from end users to the main telecommunications network. This last “mile” of a cable or wire is only used by one customer. Therefore, the costs for the installation and maintenance of this infrastructure can only be amortized through one participant, compared to many customers in the main drinks (bundle) of the network.

In supply chain management, the last mile describes a similar problem for both the transport of people and freight. In freight networks, packages for many customers can be efficiently delivered to a central hub by ships, trains, large trucks or planes. Once at this central distribution hub, these packages must be loaded into smaller vehicles for delivery to individual businesses or consumers. In transportation networks, the last mile describes the difficulty of getting people from a transportation hub such as an airport or train station to their final destination. Just like in telecommunications networks, the cost of last mile delivery is often higher.

Suitable for:

• Europe in transition: The future of logistics centers
• Local decentralized hubs – logistics centers
• Networked distribution centers – intralogistics 4.0

The transport of goods via freight rail networks and container ships is often the most efficient and cost -effective way. However, if the goods arrive at a freight station or in a port with a high capacity, they must then be transported to their final destination. This last section of the supply chain is often less efficient and makes up to 41% of the total costs for the transport of goods. This has become known as the “problem of the last mile”. The problem of the last mile can also include the challenge of carrying out deliveries in urban areas. Deliveries to retail transactions, restaurants and other dealers in a central business district often contribute to traffic jams and security problems.

A related last mile problem is the transport of goods to areas in need of humanitarian assistance. Relief supplies can sometimes reach a central transportation hub in an affected area but cannot be distributed due to damage from a natural disaster or lack of infrastructure.

A challenge for delivery on the last mile are unattended packages. Shipping companies such as UPS, FEDEX, USPS, DHL and others leave a package back unattended in a shop or at home, which means that the articles (s) the weather and the possibility of theft by “verandapirates” (one person, the packages of the verands or front doors of the Customer stealing) is exposed.

One solution to this problem is to set up lockers in urban centers. In the United States, Amazon has installed lockers where customers can pick up packages instead of leaving them at home. This protects them from theft and damage and allows companies to deliver to one location rather than multiple individual homes or businesses.

Similarly, in Japan, South Korea or Taiwan, some online retailers offer the option of delivery to a convenience store of the customer's choice for in-store pickup by the customer. Not only does this reduce the likelihood of theft and consolidate packages, but it also allows payment for in-store purchases to be offered.

To reduce costs, retailers have been exploring the use of autonomous vehicles to deliver packages. The US company Amazon and the Chinese company Alibaba have explored the use of drones to deliver goods to consumers. In Europe, Germany, the UK and Poland have experimented with services that enable automated parcel delivery.

“Last mile” also describes the difficulty of bringing people from a traffic junction, especially train stations, bus stations and ferry stations. If users have difficulty getting from their starting point to a transport network, the scenario can alternatively be referred to as the “problem of the first mile”.

Solutions to the last mile problem in public transport include the use of feeder buses, bicycle infrastructure and urban planning reform.

Other methods of alleviating the last mile problem such as bike ride systems, car sharing programs, pod cars (personal rapid transit), or motorized shoes have been proposed with varying degrees of adoption.

At the end of 2015, the Ford Motor Company received a patent for a "self -driven unicycle" (Monocycle), which is intended as a solution for commuters on the last mile. Bicycle use programs have been successfully implemented in Europe and Asia, and implementation begins in North America. From the end of 2017, micromobility services came onto the market that offered jointly used vehicles such as or rental e scooters or bicycles with electrical support in the cities.

E-mobility in cities – Image: Macrovector|shutterstock.com

In some cases, due to the demand from retailers and product manufacturers, according to accelerated deliveries (on the same and the next day), technology -based technology platforms for the last mile were created. The increased demand for the fulfillment of the last mile has put pressure on the shipper to manage many types of delivery companies that range from traditional package services to courier services to on-demand service providers, which, for example, also include an “Uber for Delivery” model Carry out the contractor.

Matching delivery supply with the demand created by shippers is a problem being solved by various last mile technology platforms. These companies connect shippers with delivery service providers to facilitate last-mile delivery. These last-mile technology platforms enable real-time data to be received by the shipper and receiver, allowing managers to take immediate action when exceptions such as a late delivery, address error, or product damage occur.

The disadvantage of this technology is the lack of trust among consumers and retailers in such decentralized systems.

Europe & USA: Last Mile Market, courier, express and parcel shipments – Image: Oakview Studios & alphaspirit | Shutterstock.com

Suitable for:

• Europe & USA: Last mile market, courier, express and parcel shipments
• Courier, express and parcel shipments in Germany
• Last Mile – The last mile
• Closing supply gaps in rural regions
• Securing basic services in rural regions
• Japan is already working on the future of tomorrow
• Urban growth – How Japan is setting the course for the future

Principle of digital platforms – Image: Xpert.Digital

More about it here:

• Digital platforms are transforming the global economy

Digital platforms and unified commerce – Image: Xpert.Digital

More about it here:

• Factsheet: Platform Economics – Platform Economics

This statistic reflects the results of a survey on the future of the platform economy in the DACH region in 2017. At the time of the survey, 45.5 percent of respondents agreed with the statement that new procurement markets can be easily opened up thanks to the platform economy.

Platform economy in the DACH region – Image: Xpert.Digital