Jul 11, 2023

The final steps in a parcel’s journey, last-mile practices have dramatically changed with the exponential rise of online business transactions and shopping. Over the past few years, consumers have expressed a bigger need for faster shipping and delivery of products. As a result, businesses are shifting their focus on how they can refine this process.

Last-mile delivery is arguably the most important step in the entirety of the shipping process. It usually accounts for over 50% of total delivery costs. Each step in the process must be reviewed, from when an order arrives to when it’s placed outside a consumer’s door. A good percentage of items are usually returned as well, which can hurt a business if they are unable to prevent this from being a common habit.

3 Issues That Last-Mile Retention Faces

The increased want for more consumer insights as items continue to cycle through the delivery process can lead to several problems in last-mile deliverables:

1. Transparency in Real-Mile Transit ­– It’s now expected of delivery services to be able to offer in-time updates on parcels from the moment the order is made. This is a newer system that has yet to reach every supply chain, which can end up causing issues and confusion as adjustments continue to be made.
2. Lack of Cost Clarification – With every deliverable, there is a flurry of costs tied with it. The amount of money spent to increase delivery speeds and maintain delivery efficiency is higher than it ever was.
3. Consistent Communication – Customers want to be in the know of everything when it comes to their ordered products. This includes delivery confirmation, expected time of delivery, and even proof of delivery. The importance of being accurate always is vital, as one mistake can cost a business, as, consumers have an abundance of tools at their fingerprints via online reviews and connectivity to shared spaces and communities.

So how exactly can AI step in and help a company out?

The Importance of AI in the New Era of Last-Mile Profits and Expectations

People don’t just want things delivered. They want real-time updates on packages to ensure items are on track to arrive when they’re meant to, and for deliverables to arrive safe and sound. AI can provide customer insights by…

• Learning what products have a higher demand so that businesses can prioritize them and maximize profits.
• Optimizing the best shipping routes, including outside factors like the weather.
• Generating a more efficient warehouse schedule in terms of what orders are being selected at what times.

These algorithms created by both AI and machine learning will also learn and improve as they continue to be used repeatedly.

AI can help in more than just the deliverables, however. Planning out the best course of action based on weather, for example, or helping to track the wear and tear of company vehicles and equipment are just a few other ways AI is reshaping how we engage with this era of digitization.

How to Get Started with AI Optimization in Last-Mile Planning

When it comes to figuring out the best strategies for using AI in last-mile strategies, it isn’t the easiest process. There is a demand to buy into the importance of what last-mile practices can do for a company’s supply chain. There must also be a willingness to learn and train employees with AI software.

Of course, not every business is alike either. There are differences in size, location, products, services, and deliverables: these are all variables that make the installation of AI a bit of a steeper hill to climb. This can potentially cause an upstir in pre-existing supply chain workflows: changing what people are familiar with isn’t always the most popular choice.

As a result, companies will need to implement the proper change management practices to ensure their employees that AI can streamline their processes, collect data more efficiently, and lead to a better customer service experience that will allow companies to grow and profit. There must be an emphasis on the pros of using AI, and a promise to deliver the proper instruction.

Optimization of one’s supply chain continues to become a growing need for companies. With more major holidays coming up, as well as students soon returning to school, being able to tackle a higher volume of shipments is challenging, but not impossible. Contact our AlwaysConnected team to learn more about how your business can cruise through inventory management and distribution.