CEO Kushal Nahata, a dynamic leader, drives the culture of customer focus FarEyethat delivers value to FarEye’s 150+ customers worldwide.
Since 2020, e-commerce has grown globally $5 trillion by 2022 and is expected to reach $6 trillion by 2024. As e-commerce has grown, the complexity – and expectations – surrounding last-mile delivery has also increased. For retail or logistics companies, providing a superior customer experience and delivering e-commerce goods from anywhere to anywhere has never been more important or challenging than it is today.
The last mile plays a vital role in the consumer experience, as it is where the brand connects directly with the end consumer through delivery. According to Salesforce research, 89% of consumers are more likely to make another purchase after a positive customer service experience. Creating superior deliveries is mission critical and requires last-mile delivery technology to manage complexity.
As the co-founder and CEO of a company dedicated to transforming delivery logistics, I have spent nearly 10 years working in last-mile delivery to enable digital transformation in the global logistics industry. My two co-founders and I were engineering students with one goal: to create a technology that was fast, easily flexible, and easy to use, allowing any company to join the e-commerce boom without an overwhelming technology investment. Our focus is to ensure that every delivery arrives at its destination on time, always, accurately, efficiently and sustainably.
Why is last mile delivery so complex?
Last-mile delivery means orders are collected from anywhere, including distribution centers, retailers and dark stores, and vehicles are loaded quickly and efficiently at multiple hubs. The vehicles are then routed to multiple destinations, including homes, shops, or various pick-up points. To achieve superior delivery experiences, companies must build adaptability, speed and visibility into their delivery networks.
With a large carrier network, it is important for companies to select the right carrier based on multiple parameters and to track orders in real time. Additional challenges come with expanding a carrier network and being able to use statistics to track each carrier’s performance and select the right carriers for each order.
Businesses can successfully navigate the complexities of last-mile delivery by:
• Create visibility for all stakeholders to know where their orders are
• Optimize delivery routes to make them more efficient with both deliveries and return collections
• Offer automated, dynamic and efficient routes for drivers to make their deliveries easier
• Establish effective shipper-carrier relationships by leveraging automated carrier rate selections to achieve on-time deliveries at optimal cost
• Reduce delivery anxiety at every step of the order-to-delivery process through ETA communication via SMS and access to real-time order tracking via email.
Fortunately, technology solves a variety of last-mile challenges and creates long-term efficiencies, such as optimizing shipping, tracking, fulfillment and routing to ensure the delivery experience exceeds consumer expectations.
Should you buy or build?
Once a company commits to using last-mile technology, there’s one big question they need to ask: build the platform themselves or buy an existing last-mile delivery platform from a vendor?
Important questions to examine when making this decision:
• Does the platform already exist?
• Is the platform easy and quick to implement?
• Does your company have the resources to build and maintain a platform in-house?
• How much does it cost to build and maintain a platform instead of buying one?
• Will last-mile technology adapt to changing market and consumer needs?
Every company involved in last mile delivery has its own challenges. If a company has sufficient internal resources, it may consider creating an internal last-mile solution. Creating in-house technology allows the company to leverage their resources to create a truly customized solution for their business. It may be cheaper to create an in-house solution initially, but there are a few areas the company wants to consider.
• How quickly can we build this technology so that we can start optimizing our last-mile deliveries?
• How challenging will it be to integrate our technology with other suppliers, carriers and stakeholders who may also have their own custom technology?
• Will we be able to quickly adapt to industry shifts and trends to dynamically adapt to the latest consumer demands?
However, custom solutions may not adapt as quickly to changes in the market. It is very important to be able to generate efficiencies quickly while keeping costs down, which can also be done by leveraging an existing last-mile delivery platform.
Buying last-mile delivery technology may be your best bet for the long haul.
In the long run, buying a last-mile delivery platform can make the most sense for several reasons. Creating in-house solutions can take a long time, while existing solutions can be implemented and deployed quickly, within weeks or months, fast success.
Today’s last-mile technology providers have the latitude and flexibility to adapt existing solutions to a company’s needs and adapt to dynamic, evolving consumer preferences. In addition, using a last-mile platform provider helps to spread the development and maintenance costs of the technology across the business units and control it as an operating expense rather than a large upfront investment.
Existing last-mile software solutions also include access to major carrier networks. This enables a more scalable and resilient last-mile delivery network quickly and cost-effectively.
Evaluate a last-mile technology purchase.
Many companies struggle with the build versus buy process. If your business has decided to purchase a last-mile delivery platform, here’s what to look for when purchasing a last-mile delivery solution and how to evaluate features and capabilities.
When purchasing a last-mile delivery platform, a company should consider whether the software can solve their pain points and then tailor solutions once integration with existing systems is complete. Does the solution provider have experience working with companies with similar needs and business models to yours? What are the initial investment and onboarding costs? Does the software drive continued operational efficiency and margin improvements?
Last-mile delivery is a fast-moving industry whose importance cannot be overemphasized for companies with a customer-centric focus. Knowing what to look for when evaluating your last mile and the impact it has on your business is key to superior delivery and making your logistics and supply chain functions a profit center for your business.