August 23, 2024
Middle mile shipping is starting to get the attention it deserves. In today’s logistics landscape, where customer expectations are higher than ever, where disruptions are commonplace, and where keeping costs in line is incredibly challenging, the middle mile plays a key role in bridging the gap to the last mile and developing the satisfaction and loyalty that lead to growth.
But the middle mile isn’t without its challenges.
The middle mile, where goods and products move from warehouse and distribution centers to fulfillment hubs, is becoming more relevant because of the rise of e-commerce and changing customer expectations. Shippers can’t wait until the last mile to start thinking about creating outstanding delivery experiences. That work must begin in the middle mile — but it’s hard. If it were easy, every shipper would have perfected the middle mile by now.
This article outlines the 10 greatest challenges in middle mile shipping today (as well as tips for how to overcome them). Keep reading to learn more about the biggest challenges in middle mile logistics, and reach out to us if you’re searching for a partner that can help you effectively bridge the gap between the middle and last mile.
Many companies still rely on legacy systems that can’t keep up with modern demands. In some cases, shippers are even using manual, analog workflows for managing middle mile logistics — which is a recipe for disaster
The case for modern technology is clear, but there are still challenges with integrating new tech into existing infrastructure. For example, some employees may remain resistant to adopting new technologies. That’s a big risk, though, because shippers miss out on the big data and analytics that can drive greater efficiency when they fail to embrace new technology.
Some shippers attempt to build their own in-house middle mile shipping programs. They acquire vehicles and hire drivers and fleet managers, and then they do their best to run the program efficiently.
The challenge is that demand typically fluctuates. This is true across almost all industries. Industrial suppliers, 3PLs, construction firms, retailers, and others all deal with periods of high demand followed by stretches with lower demand. How do you manage in-house resources across the ebbs and flows in demand? It’s hard with a 100% in-house operation — and easier when you work with a partner.
Peak seasons can add another wrinkle to middle mile logistics. As shippers try to optimize their capacity and resources for peak season, they’re forced to be prognosticators: Will demand be as high this peak season as it was last? Do external factors indicate there may be higher or lower demand? How should we plan for drivers and vehicles?
These are tough questions to answer.
With enough warning, and with the correct prognostications, shippers can hire and train seasonal workers. But if there’s more or less demand than expected, organizations may find themselves dealing with labor issues, resource challenges, and off-kilter inventory.
Effective peak season resource management is essential to meeting customer expectations while keeping middle mile margins healthy.
The rise in e-commerce has further complicated middle mile shipping. Worldwide retail e-commerce sales are expected to make up 20.1% of total retail sales in 2024 — a total of more than $6.3 trillion. This spike in online shopping forces organizations to deal with higher shipping volumes and a host of different shipping requirements. At the same time, both B2C and B2B customers now expect fast delivery times and easy returns and exchanges.
This all puts weight on middle mile shipping. Shippers must now build middle mile programs that can efficiently bridge the gap to the last mile while accounting for customer expectations and shipping requirements.
Both B2C and B2B customers want to know where their shipments are located and when they will arrive. Visibility into middle mile shipping locations has been traditionally more challenging than last mile visibility, but it’s no less important in the modern age.
Any organization managing middle mile shipping in-house may find challenges in establishing real-time tracking, data accuracy, and integrations with different platforms to support collaboration among stakeholders. But, if shippers choose to work with a third-party middle mile specialist, that partner is likely to have effective technology ready to deploy.
Buyers want to know where their shipments are located because they want to plan for arrival. In some cases, shipments may be required for projects to move forward (especially in industrial supply, manufacturing, and construction). In other cases, shipments may be required for timely delivery to consumers (like in the retail business), which can make or break customer satisfaction and the likelihood of a repeat purchase.
In-house middle mile shipping requires mastery of precise scheduling, optimized traffic and route planning, ensuring customer availability, and overall flexibility. A partner that specializes in middle mile shipping will be more adept at achieving these things than a shipper trying to build and manage an in-house program.
Middle mile shipping can deliver significant ROI, but it can also be costly without the right guardrails in place. Shippers need to consider fuel efficiency, labor costs, and vehicle maintenance when building out their middle mile programs. If you get to the point where you’re spending too much on gasoline, labor, and maintenance, those expenses could swamp your revenue and damage your financial viability.
This is where things get tough: passing the baton from the middle mile to the last mile. Many shippers think of this gap as a black box where it’s hard to provide updates and tracking status to buyers. Overcoming this challenge requires:
When you successfully bridge the gap between the middle and last miles, you’re able to boost customer satisfaction. But the opposite can also be true. A lack of connection between these two portions of a shipment’s journey can damage the customer experience.
Creating outstanding customer experiences is always a challenge in the middle mile. Deliveries need to be dependable, and customers expect accurate, timely updates so they can stay informed on the status of their shipments. One missed update or delayed delivery can erode trust. When issues do arise, shippers need to resolve them quickly to ensure customer satisfaction.
A big part of success can be establishing clear feedback loops. These loops enable organizations to gather insights directly from customers and adapt quickly to evolving expectations.
A lot of the challenges listed above relate to managing an in-house middle mile program. A third-party partner for middle mile shipping can help alleviate many of these challenges — but only if you find the right partner.
Look for middle mile shipping partners that have a strong reputation, a proven track record, and the ability to consistently deliver results. The right partner should also have on-demand resources (technology, drivers, vehicles, etc.) that you can tap into to quickly scale your shipping volume up and down as needed — while always maintaining a high level of customer satisfaction.
At FRAYT, we specialize in helping our customers effectively bridge the gap between the middle and last mile. We have a strong reputation in the industry, and a long track record of helping 3PLs, industrial suppliers, manufacturing firms, construction companies, retailers, and others master the art of middle mile shipping so that they can overcome its inherent challenges.
If you’re ready for middle mile shipping capacity that scales as you need it to, we’re here to help. Start shipping with us now.
