October 26, 2023
The world has woken up to the challenges of last mile delivery. Throughout the 21st century, retail sales volume in the United States has rapidly increased, from $278.83 billion in 2000 to $371.78 billion in 2010 and all the way to 692.5 billion in 2022. The pace at which retail sales volume has increased is only outpaced by the increase in e-commerce sales as a percentage of total retail sales. In the first quarter of 2000, e-commerce represented a paltry 0.8% of total U.S. retail sales. That figure climbed to 4.2% in Q1 of 2010 and to 15.1% in Q1 2023.
Last mile infrastructure has scaled to meet this growing demand, but there remain complexities that require solutions.
Last mile platforms can be a collective solution, as highlighted in this new article from FreightWaves. The article, which mentions FRAYT as a leading last mile platform solution, outlines some of the specific challenges inherent in today’s last mile landscape, as well as how platforms help shippers overcome those challenges.
Read on to learn more, and contact the FRAYT team to discover how our platform can help your organization master last mile shipping.
Why is the modern last mile landscape so challenging? The FreightWaves story highlights three specific reasons: heightened customer expectations, capacity limitations, and cost pressures. Here’s an in-depth look at each of these three challenges.
E-commerce was a novelty at the start of the 21st century. Many consumers didn’t trust it; those who did had few service-level expectations.
Things have changed in today’s world.
Now, customers expect fast delivery, free or affordable delivery, transparency (including real-time tracking), delivery options (like buying online and picking up in-store, curbside pickup, etc.), and a large returns window.
Amazon’s 2-day, 1-day, and same-day delivery services have contributed significantly to heightened customer expectations. So, too, did the COVID-19 pandemic, when many retailers went to great lengths to please customers as foot traffic at brick-and-mortar locations plummeted.
However these customer expectations formed, they are here to stay. And it's difficult to meet these customer expectations in the last mile.
Capacity limitations are always challenging because capacity needs are constantly fluctuating for retailers. Never is this more true than in the lead-up to the holiday season when demand for last mile capacity will surge.
Retail giants like Amazon have their own fleets and last mile delivery infrastructure. But it’s much more difficult for smaller retailers to scale their capacity to meet temporary surges in demand.
Offering fast and free or affordable delivery sounds great to customers. But it’s more taxing on the bottom lines of retailers that are providing last mile delivery services. The ultimate question is: How can a retailer keep costs in check when dealing with heightened customer expectations and when managing limited capacity?
Again, this is even more difficult in the lead-up to the holiday season when many carriers announce surcharges that send costs skyrocketing. Retailers are faced with the unenviable task of either eating these additional costs or passing them along to consumers.
The challenges listed above make today’s last mile reality sound bleak for retailers. But it’s only bleak for retailers that still operate with a 20th-century mindset. When you find the right last mile platform and partner, the following solutions become accessible.
A last mile delivery platform can streamline operations from the start of the last mile process to the end when a driver leaves a shipment on the customer’s doorstep. Platforms help retailers create shipment-by-shipment plans that account for:
Platforms take care of the heavy analytical work of creating optimized routes, staying in touch with customers, and avoiding failed deliveries.
Last mile platforms also assist with capacity planning; some go further by offering scalable capacity. For example, at FRAYT, we offer modern last mile delivery technology that helps you streamline operations, and we can also operate as your last mile delivery partner.
We have customer service-focused drivers and a diverse fleet of vehicles available to our retail partners in major markets nationwide (including all markets with an NFL team). With the right platform — and with the right partner — scaling capacity along with changes in demand becomes easy.
Streamlining operations and optimizing capacity add up to reduced costs. Rather than continuing to pour money into a last mile operation just to meet rising customer expectations, the right last mile platform and partner empower you to take a strategic approach — no matter the time of year and how the environment shifts.
This last one is important: The right last mile platform allows you to create positive, delightful customer experiences. Customers want fast and affordable delivery. They want delivery options. And they want live tracking updates. Modern last mile platforms allow you to meet customer expectations head-on, boosting loyalty and the number of repeat purchases.
At FRAYT, we simplify last mile delivery for modern retailers. We pair modern platform technology with last mile delivery services that empower your organization to meet expectations and compete with retailers of any size.
Looking for the right last mile platform and partner? Ship with us.
