From Warehouse to Doorstep: A Conversation on Last Mile Optimisation

The final delivery step to the customer, the ‘Last Mile,’ may seem simple. However, it is often one of the largest cost drivers for retailers, especially when dealing with large or fragile products. Why does this part of logistics remain such a challenge? And how can companies reduce these costs? Today, we’re speaking with consultant Jason Bos, who has experience improving the 'Last Mile'. He shares how smart adjustments and AI not only have the potential to lead to cost savings but also contribute to a more sustainable future.

The most complex part of the chain

“Last-mile delivery is all about getting products to the customer quickly and easily,” Jason explains. “That sounds simple, but this final leg of the logistics chain is often complex and costly.” Despite the short distances, costs can increase quickly, especially when it comes to large or fragile products previously only available via ‘click and collect’ – a service where customers order online and pick up their purchases in-store.

Many retailers want to improve their services and make products deliverable that traditionally are not shipped to homes. “We refer to large, heavy, or fragile products that are difficult to transport,” says Jason. “Previously, customers had to pick these items up themselves, but what if we offer a home delivery for these products as well?”

Challenges of the Last Mile

For this, it makes sense to use local stores to facilitate this Last Mile, which requires internal alignment and coordination. "If local stores will play a key role in the last mile,  important to properly inform and involve the stores in the process, especially since they now have more responsibility,” he adds. For many retailers, it is also challenging to integrate these new functionalities within the existing IT infrastructure and organisation. 

Cost savings and sustainability

Optimising Last Mile delivery not only brings benefits to customers but also results in significant operational cost savings. “For specific product segments,  around 70% of orders are associated with high costs. By deploying an alternative delivery method, you can significantly reduce those costs without the customer noticing,” Jason explains. Besides cost savings, sustainability is playing an increasingly important role. “Ultimately, we want to choose the most environmentally friendly route."

The complex Last Mile

With AI, we can potentially save operational costs and achieve a greener and more efficient Last Mile.

Jason Bos

Consultant

The role of AI in improving Last Mile delivery

AI has the potential to play a key role in optimising last-mile delivery. “AI can help analyse CO2 emissions, predict demand, and manage inventory more efficiently,” says Jason. By using this technology, delivery routes can be optimised, leading to lower costs and a smaller environmental footprint. “AI makes it possible to analyse data from various vehicles and routes, allowing us to choose the most environmentally friendly and cost-effective options,” he explains. 

Additionally, AI can contribute to more efficient internal processes, such as inventory management and cost analysis. “With AI, we can potentially save operational costs and achieve a greener and more efficient Last Mile,” he concludes.

Conclusion

Do you want to optimise your Last Mile delivery or implement AI in your logistics processes? Our team at Emixa is happy to help. Contact us today and discover the possibilities.

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