Many innovative advancements have occurred in the past few years within the transportation network, including a focus on last mile delivery costs and shipping rate management through analytics. The ever-shifting nature of the transportation industry and the growing demand for e-commerce have forever changed how shipper providers will meet consumer needs. With rising consumer expectations, the pressure to offer fast and reliable delivery without increasing costs has brought shipping processes into greater focus than ever before. With that in mind, shippers need to understand the value of using analytics to track and reduce costs in the last mile.
One of the most significant factors affecting shipping and delivery processes is the dramatic increase in the sheer volume transported every day. Costs have increased because demand has grown so quickly. Many transportation service providers have been unable to keep pace, causing capacity and drivers to fetch a premium rate. According to Supply Chain 24/7, online spending made up more than 21% of total retail sales for 2020.
Additionally, consumers spent more than $86 billion with online shopping services in 2020, an incredible increase of 44% over the previous year's rates. This unprecedented level of demand and growth continues to put pressure on shippers and carriers. It thus drives up last mile delivery costs as the industry continues to adapt to this new normal. The need for accurate supply chain data analytics and collaborative technology-driven data becomes apparent when the intricate details of last mile delivery services are considered.
Shippers have always relied on innovations and technology to improve operations and functions within the supply chain. Proper analytics make it easier to adapt and grow with changing market demands while also focusing on improving day-to-day operations by highlighting and preparing for disruptions. Last mile distribution and logistics are affected by several variables. Most are beyond the control of shippers and retailers.
Examples of last mile optimization and operation issues that are common today include:
All these factors play into the complexity of managing final mile delivery. They also contribute significantly to the rising last mile delivery costs seen and felt throughout the industry today. Proper analytics and response can help reduce their impact and improve overall operations in the supply chain network.
Addressing last mile delivery costs often comes back to the acceptance and integration of analytics and AI technology. There are several ways that automation can help manage last mile costs and expenses:
These technologically based tools and AI-driven analytics can improve shipping services and optimize last mile delivery services.
Matching the right analytical tools and processes with the right shipping services can do wonders for balancing last mile delivery costs and benefits. These last few miles of shipping are some of the most complicated and vital for shippers. By streamlining the process and ensuring optimization and continued growth, last mile delivery services and expenses can be balanced as the focus on e-commerce shipping continues to dominate the market. Connect with Intelligent Audit to start tracking and managing your last mile costs today.
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