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What is Last-Mile Logistics?

18Feb, 2015

Many retailers in Australia are familiar with the idea of outsourcing fulfilment to third party logistics providers (3PLs). Fewer, however, probably know about last-mile logistics. In this article, I want to briefly explain what last-mile fulfilment is all about, and give you some context regarding when it may be an appropriate option for your business.

Last-mile logistics is essentially the delivery of a retailer’s product to the consumer. Now you may be thinking that this sounds like all delivery options, but there are major differences that you should understand. With last-mile, the product is being picked up at either a physical retail location, or a warehouse, and brought to the consumer’s home or place of business.

So in other words, a last-mile logistics provider wouldn’t be someone you task with moving a product from a manufacturing plant to a warehouse, or even from your business to a warehouse. Instead, with last-mile it’s all about the end customer. And it’s for that reason that choosing the appropriate last-mile provider is so important. They’ll be acting as the face of your company, which means they’re in the critical position of either leaving customers with a great last-impression, or an awful one.

How “White Glove” Ties Into Last-Mile

Another important thing to know about last-mile logistics providers is that they often offer something called “white glove” services. That’s basically just a fancy way of saying that they will install your products or services for customers if necessary – usually at an additional cost to you. White glove solutions are mostly useful when you sell large or complex equipment like household appliances, medical equipment, mattresses, or high-end electronics. .

So When is it Smart to Choose a Last-Mile Provider?

Typically, the most appropriate time to choose a last-mile fulfilment company is when you keep inventory at your physical retail location. In these instances, order management and warehousing are not factors in your delivery equation, which makes fulfilment fairly straightforward.

As soon as additional fulfilment steps are involved however, I don’t recommend working with a last-mile provider. That’s because doing so will add another moving piece to your logistics processes; an additional company that you must interface with and oversee. In other words, what’s the advantage of having one company ship products to your warehouse, and then having a second company get those products and deliver them to the customer? It’s much easier to just have one company handle both portions of fulfilment.

Alternatives to Last-Mile Providers…

A great alternative to using a last-mile company is to work with a third party logistics provider. These companies not only handle every component of your fulfilment process, they also provide warehousing and inventory management. That means a streamlined and headache free logistics solution that reduces complexities and saves you time. Just make sure to do your research before choosing a 3PL, because their experience and capabilities can vary greatly.

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