Last Mile Solutions: How Do They Fit into the Logistics Ecosystem?

The logistics industry around the world is valued at $8-12 trillion per year. That’s a number that’s, frankly, almost impossible for a person to wrap their head around. The last mile, by comparison, was worth a marginally more comprehensible $1.33 billion.

When we talk about logistics solutions, we are talking about vast, complex systems—so it’s no wonder that most logistics leaders are constantly on the hunt for ways to gain increased visibility into (and control over) their supply chain and logistics operations. That means finding a way to take disparate processes and connect them up into something that isn’t just holistic and connected, but actually gets the goods to their final destination. 

The last mile is obviously a huge part of that. It’s where you see whether your other investments in the logistics chain are actually going to pay off in terms of cost-savings, efficiency, and customer satisfaction. At every phase of the process, you need to be able to ensure that the right product gets to the right location at the right time—but when it comes to the last mile you’re doing that on a gargantuan scale.

For some industries, each last mile route might have more than a dozen stops per day. If you’re reading this, we probably don’t need to tell you how hard that is to get right. So how does the last mile fit into the rest of the logistics technology process? And how do last mile solutions fit into the overall technology ecosystem for businesses that deal with logistics? 

The Changing Landscape of Logistics and Supply Chain

Logistics technology is in a state of flux. The introduction of new technologies from AI and machine learning to blockchain, the IoT, and numerous others have made it difficult to separate the wheat from the chaff in terms of which solutions are just hype and which are the real deal. 

As a result, the technology landscape across the supply chain more broadly can be hard to get a handle on. But generally speaking, we’ve seen an increase in the use of technology over the past few years. More and more businesses are leveraging cloud-based solutions that are deployed across multiple locations to plan and track first and middle mile logistics over the course of the journey. 

The use of these solutions has been a game-changer in terms of connectivity. Now that deployments aren’t based on inflexible on-premise technology, connectivity is up and gaining visibility is easier than ever. That means that more and more logistics operators have the information they need at their fingertips—rather than flying mostly blind like they might have been in the old days. 

It’s ironic that so many of these developments have come around after the heyday of “just in time” logistics. Without visibility, cutting down buffer stocks presents risks and potentially limits your flexibility—but when you can actually visualize what’s happening across your network in real time you can be much more flexible. 

This added flexibility can be valuable, but it only works if you’re able to maintain it across the entire process. This means that you need an entire ecosystem that gives you a full view of your operations. 

<< Learn how to reduce your last mile delivery costs with our Last Mile Cost Reduction Playbook -- Download now! >>

Logistics providers have always strived to find new ways of doing this—and as the technology landscape changes, new ways will keep cropping up. Everything from supply chain 4.0 to logistics 4.0 to postmodern ERP approaches are being rolled out and tested with the aim of gaining crucial clarity and control over the process. There’s no single right answer, but the options will continue to shift as the global supply chain does the same. 

How Do Last Mile Solutions Fit In?

As logistics solutions evolve, last mile solutions are evolving with them. Like we’ve been saying, this is where the rubber meets the road—if you can achieve a smooth handoff from the first and middle mile to the last mile and execute your last mile plans effectively, you can save money and keep the entire supply chain running smoothly.

Here, you need to make sure you’re leveraging technology that provides the kind of flexible, intelligent workflows we’ve been discussing. Your last mile solution needs to enable you to generate routes, coordinate with customers, track deliveries in real-time, and capture robust proof of delivery.

This is all easier said than done. Your last mile solution needs to fit in with the rest of your technology stack in such a way that your last mile teams have the data they need right when they need it. This can include:

• Order and customer information SKUs, quantities, customer addresses, etc.)
• Item availability and locations
• Fleet availability/capacity
• Requested schedule dates for deliveries 
• And much more

Back in the day, you might have been forced to go extract this data from other solutions and input them manually into your last mile solution (or even just a spreadsheet), but modern technology gives you a smarter, faster way to go. This all comes down to integrations—by connecting to ERP, WMS, PoS, and other systems seamlessly either through native integrations or APIs, modern last mile solutions can enable you to gain much greater visibility into crucial areas of the supply chain. 

At the same time, this flow of data needs to be a two-way street. Your last mile solution should be able to send data about completed deliveries back to your ERP system or other software to enable teams across your organization to follow up on deliveries appropriately. For instance, when it comes to billing clients for completed deliveries, the faster your information moves the faster you’re able to get paid. 

Best Practices for Integrating Last Mile Software into Your Technology Stack

The goal with last mile technology is smooth integration with the rest of your logistics technology ecosystem. Obviously, the capabilities of the software itself are incredibly important—there’s no value in something that’s seamlessly integrated but doesn’t actually provide usable delivery routes. But when it comes to getting your systems to work nicely within a connected ecosystem, there are a few best practices to follow:

• Adopt an “ecosystem” mindset: This might seem obvious, but it’s important to be mindful of the ways that your different processes and technology can and should intersect. Another way to say this might be that thinking about the big picture is one of the keys to effectively rolling out technology solutions that actually result in smarter processes. 
• Err on the side of SaaS: On-premise technology deployments may give you more flexibility in some sense (you “own” the software and can do what you want with it), but the tradeoff is usually that on-prem solutions aren’t built to scale—and they’re not built to integrate easily with other solutions. With SaaS, the opposite is true. These are systems that are designed to be interoperable and to update frequently so you avoid integration issues cropping up down the road. 
• Choose a tested solution: To get your entire ecosystem working right, you need the right partners. It’s not just about capabilities—though those are obviously crucial—it’s about being able to rely on your software providers for what you need in order to keep your ecosystem healthy.

From the outside, it might not look like logistics in general—and the last mile in particular—are getting any easier. But, in point of fact, the march of technology is actually giving supply chain businesses new opportunities to improve delivery and logistics performance. The trick is to take a step back and think about last mile solutions within the context of the entire logistics software ecosystem.