Referred to as a local distribution, “middle mile delivery” is a startup term. In logistics, the middle mile delivery, also known as second mile delivery, refers to the portion of a supply chain that transports items from a port to a warehouse or distribution center.
The reason it is called the local distribution is that it provides cost-cutting opportunities that last mile delivery businesses don’t consider.
While the transportation of merchandise from a fulfillment center to a retail store or a client is last mile delivery, transporting goods from a plant to a fulfillment center is middle mile delivery.Here, we will shed more light on middle mile delivery, its advantages, and disadvantages.
Table of Contents
- What is Middle Mile Delivery?
- What is the Difference Between the Middle Mile and Last Mile?
- How Does Middle Mile Delivery Work?
- What are the Benefits and Challenges of Middle Mile Delivery?
- Real-World Examples of Companies Adopting Middle Mile Delivery
- Get Optimize Routes for Middle Mile Delivery With Upper
- Ready to Adopt Middle Mile Delivery?
What is Middle Mile Delivery?
The delivery that involves transportation of goods from a warehouse or distribution center to fulfillment facilities where customers would eventually purchase their items is known as middle mile delivery.
Middle mile delivery services are gaining importance as it has a cost-saving potential that last mile delivery does not offer. Consumer products and retail are two industries that continue to make profit from it. In order to guarantee that there are enough inventories on the shelves at all times, sales beat planning is critical.
What is the Difference Between the Middle Mile and Last Mile?
Middle mile delivery is the process of shipping products from the farm to the point of origin, while last mile delivery is where products are directly handed over to their customer from the fulfillment center.
In middle mile delivery services, shippers need to collaborate with truckers via an automated delivery management process. Whereas, as far as last mile parcel deliveries are concerned, shippers need to deliver the goods to the buyer’s location.
Middle mile delivery works with the help of advanced route planning software to manage timely pickups, schedule deliveries, and fleet management. Last mile delivery needs only an efficient route to reach the customer’s location.
How Does Middle Mile Delivery Work?
In middle mile delivery, the warehouse or distribution center and the brick-and-mortar site are likely owned by the same corporation, allowing them to control both ends of the supply chain.
With competitive pricing and good margins, middle mile delivery may help firms tighten their supply chains and move ahead of the competition.
For instance, let us assume you are in the delivery business where you have a mediator who deals with your products. So, you can directly sell them to mediators in order to find the right customers or deliver them to clothing stores. Here, products are released from the warehouse and transited to the customer fulfillment center.
This process of shipping products from the manufacturing farm to the distribution center is a middle mile delivery.
What are the Benefits and Challenges of Middle Mile Delivery?
Every business comes with a number of benefits and challenges. But managing and tackling them is what makes you stand different in the market. Middle mile delivery also comes with various benefits and challenges which we will discuss further.
Benefits of middle mile delivery
The primary reason why middle mile logistics are gaining much traction in the world of the supply chain is because of the various advantages that it offers. Let us take a look at these advantages:
1. Lower Cost
You control both ends of the supply chain with middle mile delivery since you own both the distribution facility and the retail outlet. As a result, inefficiencies and errors are reduced, and you have total control over the flow of funds. You can easily cut middle mile costs.
2. Ability to accept unexpected changes
You can make changes fast and adjust to them since you have total control over the supply chain. It’s simple to expand your business and satisfy changing demands. You can also exert tighter middle mile logistics to optimize all the processes while changing.
For instance, as a result of owning its middle mile operations, Walmart’s capacity to respond to change has risen dramatically. Consolidation and optimization among organizations or partners rise when the margin of error decreases.
3. Countering competition
Many businesses use middle mile delivery to save money, which allows you to keep up with your rivals. To compete with retail behemoths like Walmart and Amazon, who have mastered middle mile delivery, it’s critical.
The giant retailers can now pass on more velocity and lower landing costs to their customers without decreasing their profits. This gives them a cost advantage in the market.
4. Opportunity for automation
The middle mile of the supply chain is where distribution vehicle is most likely to take off. Eliminating the driver allows carriers to re-allocate precious driver resources to the last mile, where drivers are needed to deliver products and run the truck, given the heightened danger of urban areas due to the density of people and things.
5. Efficient service
With middle mile delivery, you can perform on-demand service that would be a big boost to the delivery process. Such flexible delivery service may help providers to mobilize whenever the need arises. Eventually, it accelerates the distribution process and efficient delivery operations are easy to perform.
Drawbacks of middle mile delivery
Middle mile delivery comprises some drawbacks which can be managed by proper planning. They are:
1. Late delivery factors
Sometimes deliveries get delayed due to some natural or human factors. Bad weather, festival crowd, unexpected traffic, etc are the natural factors delaying middle mile deliveries.
Also, lack of maintained delivery vehicles, not tracking fuel usage, lack of fuel, etc are the humanly factors that delays deliveries from warehouse to fulfillment facilities. If these mistakes are corrected, then you can avoid delayed deliveries.
2. Lack of route planning
When the delivery trucks are dispatched from the manufacturing plant to the fulfillment centers, the distribution drivers need a proper route to follow because they need to complete deliveries to many fulfillment centers across the city. Lack of route planning causes confusion for the drivers of which delivery route to follow. Covering delivery locations unplanned may cost you more because of extra fuel usage and deliveries also get delayed. So creating a middle mile delivery strategy can help you overcome distribution planning related problems.
3. Driver shortage
Keeping middle mile delivery drivers on stand by is necessary because you never know if any urgent delivery comes up or any delivery driver takes sudden leave. Also, sometimes due to overload of work, deliveries are in excess but there is scarcity of delivery persons. So, driver shortage is a major drawback of the middle mile delivery.
Real-World Examples of Companies Adopting Middle Mile Delivery
Various organizations are opting for middle mile delivery. Here we will take the instances of Walmart and Amazon.
Walmart has discovered “milk runs” as a cost-cutting strategy.
To attain affordability in mid-mile delivery, they have begun to deploy autonomous vehicles to convey items on fixed routes.
Walmart estimates that once these cars are fully deployed, middle mile logistics and delivery costs will be cut in half.
After a successful test in five Northeastern states, Amazon has expanded its new freight brokerage service to all 48 contiguous US states.
It has strengthened Amazon’s position in the marketplace against other big digital brokerage businesses.
Amazon now has more control and visibility over its logistics after purchasing heavy-duty tractors from Volvo (in October 2019).
Amazon is beefing up its middle mile delivery infrastructure to keep up with the logistics companies’ rapid expansion and deliver items to consumers faster and more effectively at the lowest possible cost.
3. Loblaw Co.
The major Canadian grocer Loblaw recently adopted middle mile delivery in order to streamline its online grocery service, popularly known as PC Express.
The tech firm has also rolled out contactless delivery for supplying groceries in Toronto. It has also collaborated with self-driving vehicle giant Gatik to meet customer expectations and provide efficient grocery deliveries.
As per one of its officials, they adopted middle mile delivery to increase their efficiency in the supply chain operations.
Get Optimize Routes for Middle Mile Delivery With Upper
Since many tech giants have started using advanced technology, it has now been easier to deal with any modern-day problems. Similarly, optimized routes can be done with the help of route optimization software.
Online Route planners like Upper can help you find optimized routes within a minute. It allows generating a route plan including up to 500 extra stops. Whether it is a middle mile delivery or last mile delivery, you can use Upper to plan and optimize routes quickly.
The advanced distribution route optimization software can churn out unlimited optimal routes to facilitate middle mile delivery. It provides a helping hand to the delivery manager with an automated process that doesn’t need manual intervention.
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In simpler words, delivering a product from the warehouse to the customer fulfillment center via route scheduling and driver’s availability is referred to as middle mile delivery.
The shipping process consisting of transportation of goods or products between two parties is considered a middle mile carrier. Here, two parties are the manufacturer and supplier who transfer the goods from the warehouse to the supplier’s store.
Tech giants like Amazon consider hiring major trucking companies to carry out the shipping of purchased orders. They use the autonomous delivery process to ensure on time delivery of products to their customers.
For optimizing routes, you can get the right route planning and optimization software as using simple navigation apps would not be enough. You can utilize Upper Route Planner to quickly optimize unlimited routes.
The first-mile delivery refers to the portion of the journey from the plant or farm to the warehouse or distribution hub. While middle mile delivery is the process of products being released from the warehouse and moving to the fulfillment center. Last mile delivery works as a delivery process for transporting goods to the buyer’s location.
Ready to Adopt Middle Mile Delivery?
Now you know the middle mile delivery has various benefits and if you are planning to start a new business or make improvisations in the existing business, this is the right time!
To help you tackle any route planning or middle mile delivery optimization-related problems, Upper Route Planner has got your back! With Upper, you can simplify the process of optimizing middle mile delivery routes to save time, money, and effort. Moreover, the software helps you plan and optimize routes with multiple locations in just a matter of seconds.
BOOK A FREE DEMO now to know the ins and outs of Upper Route Planner and how it can benefit your business.