Improving Shipper Experience and Efficiency With First-Mile Logistics
The procedures for storing and transporting merchandise for an online marketplace or any marketplace are called e-commerce logistics. E-commerce logistics begins with the movement of merchandise from the producer and continues until it reaches the final client. This covers picking, packaging, shipping of online orders, and inventory management.
The stated speed at which customers will get their orders can make a difference when individuals decide between online and in-store. Delivery speed determines whether customers want to purchase from your online business or a rival’s.
Delivering orders to clients has grown increasingly challenging as the e-commerce sector constantly expands, particularly in light of COVID-19. Many rapidly expanding online retailers struggle with the constant balancing act of providing customers with an exceptional delivery experience. A positive and fast shipping experience helps maintain a positive customer retention rate.
What if you could enhance last-mile delivery earlier in the e-commerce supply chain? It turns out that strengthening the first-mile delivery stage will result in significant downstream advantages since it directly affects the shipping experience.
Here, we’ll examine how e-commerce first-mile logistics functions, how it differs from brick-and-mortar retail, and how to offer better shipping options for positive sales growth.
What is First-Mile Logistics?
The e-commerce sector places a lot of value on speed. To have more supervision over the delivery process, the seller now transports the items from the manufacturer’s facility to the warehouse. First-mile delivery entails moving goods from a retailer’s or manufacturer’s location to the central warehouse, along with tracking the item when an order is prepared for shipping, setting up trucks to pick up the order, bringing it to the warehouse, and finally guaranteeing adequate storage so that the items may be dispatched effectively.
Telephone calls are used to manually complete a sizable amount of the first-mile logistics procedure. First-mile logistics operations primarily include functions related to manufacturers, managing order updates, and basic logistics operations like picking, packing, loading, transportation, and fleet management.
However, the basic first-mile logistics operations demand due attention to certain pain points. It allows e-commerce companies to turn to a comprehensive digital strategy to carry out their functions seamlessly.
Pick-ups and Drop-offs: What’s the Difference?
A smooth first-mile logistics operation is a crucial element of any e-commerce delivery. First-mile delivery sets the precedence for the upcoming logistical functions, ensuring its quick and hassle-free movement down the supply chain.
The logistics service providers generally offer pick-ups to the companies or manufacturers ready to have their finished products picked up from their own warehouse, inventory, or retail storefront.
Pick-up helps the manufacturers or merchants save extra time and effort in carrying out the basic fulfillment operation. However, pick-ups might have specific fees imposed depending on the service providers. Therefore, it is crucial for a business to look out for logistics service providers willing to offer ‘free’ pick-up service.
On the other hand, drop-offs are ideal for the merchants or manufacturers willing to transport their manufactured finished products to the logistics service providers to receive them. With their personal vehicles, large and big banner companies carry out drop-offs for easy movement of goods. Typically, drop-offs are free.
Both pick-ups and drop-offs are essential operations in first-mile logistics and the supply chain sector. Therefore a company needs to select a strategy that works for the e-commerce logistics supply chain in terms of demand and practicality. First-mile logistics determine the operational efficiency of the whole order fulfillment process.
Importance of First-Mile Logistics
First-mile logistics, being the first stage in the supply chain, has an immense impact on the order fulfillment process of a company. As per a recent survey conducted in 2021, global e-commerce sales saw a steady growth of approximately $5 trillion, which is forecasted to grow by 50% over the coming years, reaching an amount of 7.4 trillion dollars by 2025.
Ineffective first-mile delivery may have a domino effect that slows last-mile delivery by impacting the effectiveness of the supply chain throughout fulfillment. Some of these bottlenecks frequently have their origins in incorrect purchase orders. For instance, if manufacturing is delayed or the inaccurate inventory is delivered, it’s enough to throw off the remainder of the supply chain, especially if a company is receiving orders that depend on the arrival of the upcoming shipment of stock.
Fortunately, many problems that arise during first-mile logistics may be resolved by identifying ways to increase visibility, diversify the supplier network, and implement a rigorous warehouse receiving procedure.
Challenges in First-Mile Logistics Operations
Online sellers need to evaluate first-mile delivery procedures carefully. By the time a company has reached the first mile, it has already spent time and money investigating the best places to obtain materials and products. The courier is then carefully selected. The company can approach negotiations with the courier in the most effective manner by formulating questions that will lead to an agreement.
However, specific challenges that emerge as a bottleneck for seamless first-mile logistics operations include –
- Poor First-Mile Experience – Businesses have come to understand the value of last-mile delivery in offering an outstanding customer experience through the years. Since this process has fewer stakeholders and is not customer-facing, the first-mile logistics operations have been conveniently overlooked. First-mile operations should receive the same attention as other aspects of the supply chain, such as the requirement to provide consumers with complete delivery process transparency and reduce logistical costs. Due to this, businesses must use reliable first-mile tracking systems that reduce first-mile expenses and provide deep transparency of delivery operations.
- Poor Labeling Techniques – Labeling is a minor but crucial component of first-mile delivery. Many companies still hand-label goods nowadays. As a result, not all needed fields are specified in packages, which causes dispatching to be ineffective and susceptible to delays. Furthermore, labels made of inferior materials risk coming off, being damaged, or becoming too faded to read.
Tracking a lost parcel’s exact location in the supply chain would be extremely difficult for LSPs and merchants. It is illegal for LSPs to open shipments to identify things without permission. Automating dispatching is a crucial component of last-mile tracking technology that can solve this problem rapidly.
- Inefficient Packaging Service – Packaging often suffers due to the rush to supply quickly. Businesses frequently employ standard packaging materials regardless of the sort of goods a container contains. This delays the entire freight transportation procedure and results in severe damages in the initial mile. Therefore, using cutting-edge delivery systems that enable companies to take greater control of the handling of materials is crucial.
- Poor Visibility – Lack of first-mile operations visibility is a major issue that eventually affects both last-mile and mid-mile processes as well as the experience of the end-user. Poor handling, transit delays, ineffective tracking of freight flow from a factory to a hub, and other factors negatively influence visibility.
- Traffic Congestion – Overcoming traffic congestion is a typical difficulty in the first-mile logistics procedure. When planning first-mile deliveries, you must consider the possibility of bad traffic conditions. Otherwise, it may result in goods arriving at the customs office after operating hours, resulting in a wasted trip when the goods must be stored at the warehouse until the LSPs open again.
Best Practices for First-Mile Logistics
First-mile logistics operations might seem scary initially. However, if handled properly, they can be a terrific starting point for a supply chain and positively affect the subsequent phases.
Working with partners assisting with deliveries might make things simpler for an e-commerce merchant, especially international freight. It is essential to choose the best group of shipping partners globally to help with organization and packing if a company wants to keep its shipment process running smoothly.
Here are some recommendations for making first-mile logistics a delight –
- Providing Accurate Information
It is simpler for a business to verify that all information is accurately and thoroughly filled out if the logistics service provider uses digital templates to input the essential data for the shipment to be produced. This is particularly true when filling out the address and name fields on the label, which define where the package will be delivered.
The distribution procedure becomes challenging for LSPs if the consumer’s name is incorrect or partial. Additionally, entering the data in a language recognizable on the LSP’s system is important. For instance, reading special characters in specific languages could be impossible.
This is done to avoid the delivery being rejected immediately by the system or after it has undergone numerous steps of the procedure. Before the supply chain process starts, it is essential to verify that phone numbers and zip codes are accurately entered because they are equally important information for last-mile delivery.
- Remaining Organized
Making plans in advance is crucial to maintaining productivity. The first-mile partner’s vans may have several locations and limited space. Their drivers must plan and organize their shipments to ensure their itineraries and van space are used as efficiently as possible for each cargo to reach the airport or port.
Early entry into the core system of all necessary order information reduces the possibility that the packages will be delayed until the next pick-up owing to a late demand and insufficient space.
- Properly Packing Shipments
Finally, one of the most important ways to save money on shipping is to package the containers properly to withstand the delivery voyage. The proper exterior packing, filler, cushioning materials, and strong sealing tape contribute to keeping shipments secure if they are jostling or being crushed while en route.
Additionally, it is crucial to label shipments with high-quality materials so that the labels can adhere to and clearly show where they are going. This will make it possible for the packages to pass customs quickly and be handed to the intended recipient.
Optimizing First-Mile Logistics
Automating procedures is the secret to first-mile logistics optimization. With the right technology, you may transform expenses into capital for expansion. In the last mile of the supply chain, loading and delivery times are more efficient when first-mile processes operate leanly.
Innovative businesses take advantage of every chance to evaluate logistics and search for ways to hasten the delivery of their goods to customers. They inter-logistically compile data from several operational phases. It might result in their ability to sell their goods for less, giving them an advantage over competitors.
A review of the workforce’s tasks can provide information on how to switch some of the human jobs to automated ones. This results in operational savings and increases employee satisfaction because it gives them new and challenging tasks. Additionally, this could reduce high turnover rates.
Conclusion
First-mile logistics operations are crucial for creating a solid foundation since they come from the beginning of a supply chain. Consumers who receive their items on time and in excellent shape are happy. When standards are poor or uneven, customers leave. There is too much competition to overlook, and even minor errors can limit the company’s expansion.
FAQs
What is first-mile delivery?
The first step of first-mile delivery is when the package leaves the seller’s warehouse to be processed or transported. The parcel is processed and moved along until it arrives at the customer’s doorstep after arriving at the postal service or the courier’s hub. First-mile delivery is one of the most important phases of online retailers’ supply chain.
What is first-mile tracking?
The technique of tracking the movement of items along the first supply chain link is known as first-mile tracking. Managing several sites for loading and unloading delivery, scheduling various drivers, and integrating multiple order ID numbers are a few examples of these complex operations.
What are the first-mile and middle-mile logistics in order fulfillment?
First-mile delivery entails moving goods from a retailer’s or manufacturer’s location to the central warehouse. The middle-mile distribution process often includes moving goods from warehouses to retail establishments.
What is the first-mile sorting center?
A warehouse, distribution center, or fulfillment center is a first-mile sorting center. It is the location where produced items are delivered and typically kept until a buyer purchases them.
What are the inbound logistics?
Materials and other commodities are carried into a firm through inbound logistics. The actions to order, acquire, store, transport, and handle incoming goods are all included in this process. The supply side of the supply-demand equilibrium is the main focus of inbound logistics.
