During the early pandemic, DHL saw parcel deliveries increase from 5.3 to 9 million — levels only previously experienced during holiday peaks — a day. Six months later, throughout the 2020 holiday season, millions experienced a delay in packages as deliveries reached new record volumes. What may have been a Hanukkah or Christmas gift quickly turned into a New Year’s or Valentine’s Day present due to the busiest week in history for USPS.
These increases illustrate how the COVID-19 forever changed supply chains and last-mile logistics. And although companies like Amazon worked overtime to address their own delays (and hired 175,000 people to compensate), couriers such as UPS, Fedex and Royal Mail increased staffing; the ultimate burden fell on mailrooms, who were caught unaware. Commercial and Residential buildings were forced to take the brunt of the logistical burden that would usually fall on high street shops. These buildings, often built before the advent of online shopping, were now expected to act as a sorting and distribution hub for hundreds if not thousands of consumers living and working from there, and whose consumer habits had drastically changed!
What is Last-Mile Logistics?
Last-mile logistics refer to the end step of a delivery process. It occurs when a package is taken from a distribution center or facility to the end-user (i.e., purchaser). Recent revisions to last-mile logistics have been prompted by newly increased delivery speeds. For instance, Amazon Prime began offering 2-day delivery on over 1 million in-stock items in February 2005. In 2019, they dropped it down to 1-day or even same-day shipping on certain items.
Now, they’ve created the expectation of 2-day shipping, which has prompted their competitors to begin offering comparable deals. For example, massive retailers like Walmart and Target will provide free 2-day shipping if you purchase more than $35 worth of items.
This convenience for customers comes with a lot of asks if you want to keep costs down for businesses, and that’s where last-mile logistics come in. By focusing on digitalization and live tracking of fleets, you’re able to improve route planning and analytics of delivery. You can also increase capacity and the density in urbanized areas. Amazon, for instance, can already ship to 72% of the population within a day based on this map.
Other notable trends are popping up in this area. Most relevantly, the increase in affordable automated collection points and the rise of driverless vehicles. As more of the delivery life cycle becomes managed by antonymous robotics, the last mile will continue to adjust as well.
Read the full story and more insights in The Logistics Point Magazine October here!