There’s a reason third-party delivery providers have taken over the last mile delivery space. And it’s not just because they can get your packages to their destination faster. In this blog post, we’ll explore some of the reasons 3PL companies are so successful in last-mile delivery and why you should consider using them for your business.
What Is Last-Mile Delivery?
The last-mile delivery is the final step of the delivery process. This is when a package is moved from a transportation hub to its final destination, for instance, a personal residence or retail store.
This is the most important step in the delivery process. Businesses want to make sure that it is quick and efficient so that they can meet the demands of consumers.
In addition, keep in mind that delivery is different from shipping.
Why Is Last-Mile Delivery Important for E-Commerce?
The last mile can impact more than the first sale. It can also impact how likely people are to buy from you again. The GFS-IMRG survey found that 60 percent of customers would buy from a retailer again if they had a good delivery experience. Getting the last mile right increases customer loyalty and helps companies grow their business.
Customers care about last-mile delivery and returns. This is especially important when they are checking out online. Company policies and performance affect whether or not customers will buy from that company again – or even for the first time. Businesses that offer a poor experience or think a one-size-fits-all approach is good enough are making a mistake.
In the competitive e-commerce space, customer preferences are very important. One way companies can stand out against their competitors is by providing great delivery and return services. This is especially important in online marketplaces where there is direct competition.
Many companies focus on free delivery, thinking that it is the most important mode of delivery to stay ahead of the competition. However, what customers really want is speed and flexibility. They want different delivery options so they can choose one that will cause the least disruption in their day-to-day lives.
The Main Challenges in Last-Mile Delivery
Lack of Visibility
Making sure that buyers can see where their package is and when it will be delivered is the most important way to ensure customer loyalty. Buyers want to know everything about their package, including its location.
Some businesses are starting to give tracking codes to their customers so they can see where their package is. But even with the tracking codes, customers want more. They want to see real-time information about where their package is and what is happening with it.
You can offer increased transparency to your customers about their packages by using delivery management software that offers real-time status. This will allow your customers to track their packages all the way to their doorstep.
Check out our guide on last-mile delivery tracking to learn more.
A recent study by SOTI found that nearly half of all transportation and logistics companies are using outdated technology for last-mile delivery. This can lead to delays and high shipping costs. However, with the help of a 3PL service provider, this can be mitigated.
By installing a GPS tracking system in delivery vehicles and using the internet of things (IoT), you can monitor the entire last-mile journey. This will help you predict any potential hurdles and come up with proactive strategies to deal with them.
Many 3PL companies offer delivery management software to help with digitalizing core logistics operations. This software can help with dispatching, tracking deliveries, viewing order details, expected delivery time, vehicle tracking, route planning, and more.
Having access to information in real-time makes it easier to see where your shipments are and what is happening with them. This improves operational efficiency, saves time and resources, reduces human errors, and makes it easier to give good customer service. You’ll be better able to manage deliveries with all the best options available to you.
Making sure customers are happy drives the increased efficiency of last-mile delivery. High levels of efficiency help boost your fulfillment capacities. If your process is not efficient, you experience a rise in delayed deliveries and frustrated customers, especially when handling large order volumes.
Deploy software that helps with the process of getting your products to the customer’s doorstep. This software can help you adjust your plans quickly if something changes last minute.
Many problems in a supply chain happen because of unstructured processes. This can lead to long processing times, low outputs, and wasted time and money. A 3PL can help by defining warehouse processes and managing them efficiently.
Moreover, inefficient operations must trigger logistics optimization in order for a company to reduce the number of gray holes in logistical processes.
There are many more challenges in the last-mile delivery besides the few we have mentioned above, which is why you should consider how to manage your logistics successfully.
Why 3PL Companies Are Best for Last-Mile Delivery
1. Distribution of Goods
When running a business, it’s important to have an efficient system for distributing goods to customers. The most expensive and time-consuming part of this process is often the “last mile” of delivery, which is why many businesses choose to use third-party logistics (3PL) providers for this portion of their supply chain.
A 3PL can help you distribute your products to different distribution centers in more than one country. This process also takes care of the customs clearance for you. Based on your target audience, a 3PL can ensure that your products are stocked at the closest distribution centers.
3PL companies specialize in optimizing the last mile of delivery, which can lead to significant cost savings for businesses. In addition, using a 3PL can help to improve customer satisfaction by ensuring that orders are delivered on time and in good condition.
2. Consolidation of Goods
Using 3PL companies can save businesses a lot of money and hassle, especially when it comes to the consolidation of goods. Basically, consolidation is the process of combining multiple shipments into one in order to save on shipping costs. This is often done by consolidating orders from different customers that are going to the same general destination.
By consolidating these orders, businesses can take advantage of economies of scale and get better rates from their shipping carrier. In addition, they can also reduce the number of overall shipments, which can help to save time and labor costs.
Thinking of partnering with a reliable logistics provider? Check out the top last-mile delivery companies and startups in the US.
3. Product Repackaging
3PLs have the knowledge and experience necessary to safely repackage products for last-mile delivery. This can be invaluable for businesses that sell delicate or breakable items. In addition, product repackaging can help to reduce shipping costs by making better use of space in delivery vehicles.
It can also be time-consuming to repack and bundle goods per each customer’s order. However, 3PL companies have the technology and resources to do this for you much more quickly.
4. Route Optimization
3PLs use advanced software to map out the most efficient routes for drivers, taking into account traffic conditions, construction zones, and more. This helps to ensure that deliveries are made on time and that drivers don’t get unnecessarily stuck in traffic. In addition, route optimization can help to reduce fuel costs and vehicle wear and tear.
How you plan your delivery route can have a big impact on how fast your packages get to the customer. When you make several stops at people’s houses, it takes longer. You can save time by planning your route better so that the packages only have to go to a few different places. This will also help you use your resources more efficiently.
When choosing a 3PL provider, you must consider one that integrates route optimization technology and smart or live tracking.
5. Fast Delivery
You can expect faster deliveries of your e-commerce product to your customers. This is possible because a 3PL company can speed up the delivery process by using multiple distribution centers and advanced route optimization.
An efficient last-mile delivery service can mean the difference between a satisfied customer and a lost sale. Fortunately, there are a number of third-party logistics providers that specialize in fast delivery — like Dropoff.
These companies have the resources and experience to get your products to your customers quickly and safely. In addition, they often offer tracking and insurance services that give you peace of mind.
6. Returns Management
For businesses that sell online, third-party logistics (3PL) providers offer the ability to manage returns effectively. Returns are a reality of doing business online, and managing them in-house can be both time-consuming and costly.
By using a 3PL provider that specializes in returns management, businesses can minimize the impact of returns on their operations. Returns are a major challenge for businesses that sell online, since customers may not be able to return items to a physical store.
Further, 3PLs can help to manage returns by providing a dedicated returns center and coordinating with the customer to arrange for the return of the item.
7. Customer Satisfaction
In the modern business world, customer satisfaction is more important than ever. With the rise of e-commerce, businesses now have to compete for customers on a global scale. As a result, it’s essential to ensure that your products are delivered quickly and efficiently. For many businesses, this means working with 3PL companies for last-mile delivery.
A 3PL can provide a number of benefits, including lower shipping costs, improved delivery times, and increased flexibility. In addition, a 3PL can help to improve customer satisfaction by providing tracking information and offering customer support. As the competition for customers continues to increase, working with 3PL companies can give your business the edge it needs to succeed.
At Dropoff, we take customer trust very seriously. We use technology to build that trust, whether it be through on-demand or pre-scheduled scheduling, real-time tracking, or providing consumers with clear, up-to-the-minute ETAs.