First-mile Delivery: What it is and Why it’s Important in Logistics?

keyKey Takeaways:
  • First-mile delivery refers to the initial delivery of the goods from the point of origin to the last hub before the final shipment.
  • Traffic congestion, abrupt order changes, tracking limitations, and risks of theft or damage are the common first-mile delivery challenges.
  • Last-minute changes disrupt routes, cause delays, and affect the overall efficiency of the supply chain.
  • Future advancements like autonomous vehicles, drones, and AI-based route optimization are expected to revolutionize first-mile delivery.

Did you know?
The forecast for the global first and last-mile delivery market is set to surge to nearly $300 billion by 2031, driven by the relentless wave of eCommerce.

As eCommerce dominates the market, customers have become accustomed to expecting ultra-fast delivery. Surprisingly, in the rush to optimize last-mile consumer delivery, the first crucial steps of the supply chain often get overlooked.

Ever wondered how your online orders magically appear at your doorstep? This is where first mile delivery comes into play.

Now, you might be asking, “What’s the big deal about the first mile?”

So, it is not just about physical movement; rather, it is about careful planning, strategic handling, and seamless coordination between different parties. This is how first-mile delivery silently paves the way for packages to arrive on time. 

Curious to learn more? Join us on this journey, where we will learn what first-mile delivery is and how it shapes the efficiency of the entire delivery process.

What is First-mile Delivery?

First-mile delivery refers to the initial transportation stage when a product moves from its point of origin to the last hub before final shipment to the end consumer.

This stage involves bulk packaging, transportation (often via trucks or ships), customs clearance (if international), and warehousing. It includes the journey from the warehouse, storage facility, supplier location, or production site to the distribution center. 

Efficient first-mile operations ensure on-time hand-offs between intermediaries to avoid disruption. For instance, a package dispatched from the warehouse to reach the distribution center represents a typical scenario in first-mile delivery.

How is first-mile delivery different from last-mile delivery?

Feature First-mile delivery Last-mile delivery
Stage From manufacturer to warehouse From warehouse to customer
Goods Movement of bulk goods Movement of individual packages
Transaction Business-to-business transactions Business-to-customer transactions
Transportation Trucks, ships, and planes Cars, vans, and bikes
Focus Focus on efficiency and cost reduction Focus on the customer experience

How Does First-mile Delivery Work?

First-mile delivery encompasses the movement of goods from the warehouse, manufacturer, or supplier to the transportation network. Here’s a breakdown of how the first-mile delivery process works:

Step 1: Order processing

Order processing marks the commencement of the first-mile delivery. It involves the reception and handling of orders from different channels, like customers, suppliers, or retailers, ensuring accuracy and completeness.

These orders initiate subsequent actions in the logistics chain once they have been validated, establishing the order in which goods will be prepared and shipped. The accuracy of this processing phase lays the groundwork for an effective and error-free delivery process.

Step 2: Inventory handling

Goods are carefully selected from storage for accuracy, followed by systematic arrangement based on destination. This method smoothes out packing, ensuring items are arranged efficiently for transportation.

Moreover, effective packing secures items for transit, lessening errors and guaranteeing readiness. This meticulous handling plays a critical role in maintaining the integrity and efficiency of the entire logistics process.

Step 3: Route planning

It involves a process of optimizing the most efficient route for the movement of goods. Using cutting-edge innovation and algorithms, logistics experts factor in crucial variables such as traffic congestion, distance, and delivery timelines.

This strategic planning streamlines the journey, ensuring prompt delivery while minimizing delays and resource waste. By considering these aspects, the supply chain can find optimal routes for efficient deliveries.

Step 4: Transportation initiation

This step represents the crucial process of moving goods from the distribution center or storage facility onto designated vehicles or carriers. This stage involves careful loading processes, guaranteeing things are safely placed and ready for transit.

Once loaded, products begin their journey, marking the movement in the logistics chain focused on convenient and effective delivery. This step kickstarts the actual transportation of goods from their origin to their final destinations.

Step 5: Real-time tracking

Real-time tracking upsets strategies by utilizing cutting-edge innovation for continuous checking and visibility of goods on the way. This system provides instantaneous updates on the condition and location of cargo via GPS, RFID, or IoT-enabled devices.

This empowers logistics managers to track shipments continuously. It also allows them to anticipate and promptly address any potential delays or deviations in the delivery process, ensuring smooth operations and enhanced customer satisfaction.

Step 6: Hand-off to carriers

At transportation hubs, the hand-off to carriers represents an essential crossroads in the delivery process. Here, the transition of goods from internal logistics networks to carrier services for wider distribution takes place.

This step includes confirming shipments, guaranteeing precise documentation, and seamlessly transferring responsibility to carriers. It denotes the transition from internal handling to external distribution networks, ensuring their efficient journey to their final destination.

This step-by-step process underscores the critical stages involved in first-mile delivery, highlighting its importance in kickstarting the logistics journey.

Importance of First-mile Delivery in Logistics

As the eCommerce market grows, efficient first-mile delivery becomes crucial, influencing the performance of the supply chain. So, let us learn about its significance in detail:

1. Timeliness and efficiency

First-mile delivery affects the pace of subsequent operations by determining the speed at which goods enter the supply chain. Thus, handling it efficiently sets the speed for the whole process, meeting market needs and cutting down wait times.

2. Cost optimization

Simplifying initial processes such as figuring out the best routes, managing inventory, and handling transportation by planning smartly and coordinating smoothly saves costs in the long run. This is how well-managed first-mile logistics impact the operational expenses of the entire delivery process.

3. Inventory management

Efficient first-mile processes guarantee precise inventory tracking and management. This accuracy prevents stockouts, minimizes excess inventory, and facilitates better demand forecasting, resulting in improved resource allocation.

4. Customer satisfaction

The beginning of the delivery journey has a big impact on the last mile delivery experience. For instance, prompt and precise first-mile activities contribute to on-time deliveries, improving overall consumer loyalty.

5. Reduced carbon footprint

Effective first-mile logistics often incorporate enhanced route planning and load distribution. These practices contribute to lower fuel utilization and emissions, promoting environmental sustainability by decreasing the ecological impact of transportation.

6. Improved last-mile delivery accuracy

A well-executed first-mile process enhances the accuracy of the last mile delivery process. This improves overall delivery precision and customer satisfaction by lowering errors and return rates and facilitating customer handoffs.

This is how the efficiency of first-mile operations shapes the entire supply chain process, influencing costs, responsiveness, and sustainability.

Challenges of First-mile Delivery

In the complex world of delivering goods, first-mile delivery encounters a myriad of challenges that demand smart solutions. Some major challenges of the first-mile delivery process include:

  • Traffic congestion presents a major challenge, prompting delays in pickup and delivery. It particularly affects the movement of goods due to high traffic volumes in urban areas or during specific times, impacting the efficiency of logistics operations.
  • Abrupt order changes force quick adjustments, disrupting pre-planned shipping logistics. These changes might include rerouting, repacking, or rescheduling, affecting the entire delivery plan and increasing operational expenses.
  • Restricted tracking systems lead to a lack of real-time visibility into the movement of goods. This absence of transparency hampers precise monitoring, making it difficult to find the exact location of shipments in transit.
  • Risks related to theft, damage, or tampering during transportation threaten the integrity of goods. Hence, guaranteeing the security of shipments from the beginning to the local distribution center becomes crucial in safeguarding the delivery process.

Therefore, overcoming these challenges in first-mile delivery requires smart solutions that guarantee a smooth start for logistics operations.

How to Optimize First-mile Delivery?

Optimizing first-mile delivery requires an essential combination of innovative methodologies and technological advancements to streamline operations from the point of origin.

Efficient optimization strategies involve

  1. Route Planning and Optimization
  2. Technology Integration
  3. Warehouse Innovation
  4. Data-driven Decision-making
  5. Collaborative Partnerships

Going ahead, let us learn about these strategies in detail-

1. Advanced route planning tools and algorithms smooth out first-mile delivery by examining real-time traffic data, road conditions, and delivery schedules. Streamlining routes limits travel time, cuts fuel usage, and keeps away from blockages, guaranteeing timely deliveries and enhancing productivity. 

This strategic approach boosts reliability by meeting client expectations and shaping a solid foundation for final mile delivery too.

2. Integrating tracking and monitoring systems provides a bird’s eye view, empowering better and faster delivery decisions. Technology such as GPS enables precise tracking for route optimization, whereas RFID improves the accuracy of goods handling. This visibility allows stakeholders to monitor progress, anticipate issues, and proactively address them. 

Ultimately, these systems provide businesses with better control and increased transparency, building trust and satisfaction among both businesses and customers.

3. Implementing warehouse innovations involves incorporating automation, robotics, and Internet of Things (IoT) devices within storage facilities. These advances optimize various tasks like storage, sorting, and retrieval, essentially improving operational efficiency. 

Automated inventory management systems minimize mistakes in stock monitoring, leading to improved accuracy and quicker dispatch of goods to transportation hubs. This streamlining not only reduces errors but also speeds up the operations within the first-mile delivery phase.

4. Data-driven decision-making uses advanced analytics from historical and real-time data. By analyzing past patterns and current data, businesses can precisely anticipate demand fluctuations. This forecasting optimizes stock levels, guaranteeing timely product availability.

Striking this balance minimizes the risks of less or excessive stock, enhancing operational efficiency. Ultimately, this strategy gives businesses the ability to change with the market, which makes customers happier and saves money on unnecessary inventory costs.

5. Collaborating closely with suppliers, carriers, and key stakeholders promotes effective communication and smooth operations. By sustaining these relationships, businesses can guarantee a coordinated and unified approach to delivery logistics. 

Establishing collaborative partnerships fosters a cohesive network where every partner’s skill contributes to a synchronized work process. This benefits the entire supply chain, guaranteeing timely and reliable deliveries.

Overall, these optimization strategies work cooperatively, adding to a more efficient, cost-effective, and client-driven first-mile delivery process.

FAQs

The primary goals of first-mile delivery in the logistics chain revolve around the swift and accurate initiation of goods into the supply network. This stage aims to ensure timely movement from the origin to transportation hubs. Its primary objectives are optimizing routes, minimizing delays, and laying the groundwork for an effective delivery process.

Last-minute order changes impact first-mile delivery operations in the following ways: Disrupt planned routes and schedules, Cause delays in delivery timelines, This leads to inefficient resource utilization, Challenge the maintenance of timely and accurate deliveries, and Affect the overall efficiency of the initial logistics phase.

Emerging technologies are poised to revolutionize first-mile delivery through Autonomous vehicles, Drones and AI-based route optimization.

Final Thoughts

First-mile delivery is the backbone of the supply chain, directing the movement of goods. This process emphasizes its significance in meeting evolving consumer demands for speed, accuracy, and reliability.

In this era of technological advancement and evolving logistics strategies, embracing innovations like Upper becomes paramount. Its user-friendly features simplify the delivery process, ensuring a smoother movement of goods from their starting point to their final destination. 

To experience this efficiency firsthand, Upper offers a , allowing you to explore and streamline your delivery chain seamlessly.

Author Bio
Rakesh Patel
Rakesh Patel

Rakesh Patel, author of two defining books on reverse geotagging, is a trusted authority in routing and logistics. His innovative solutions at Upper Route Planner have simplified logistics for businesses across the board. A thought leader in the field, Rakesh's insights are shaping the future of modern-day logistics, making him your go-to expert for all things route optimization. Read more.