The Final Stretch: Overcoming the Top 6 Challenges in E-Commerce Last-Mile Delivery

Recent findings reveal that approximately 61% of businesses view the ‘last mile’ or final stage of delivery as the least efficient component of their supply chain.

Be it dealing with geographical complexities, last-mile tracking difficulties or rising delivery costs, e-commerce stores face several challenges when it comes to delivering products to customers.

For a business owner, addressing these issues should not be a cause for distress. Instead, you can view them as an opportunity to innovate and push the final delivery stage forward.

Here’s a look at the top 6 challenges of e-commerce last-mile delivery and how you can tackle them.

1. Increasing Costs

Last-mile deliveries aren’t exactly a bargain; they make up about 53% of all shipping costs. So, you might wonder, what’s driving up these operating expenses? The answer is the cost of labor, fuel, carriers, driver salaries and ineffective route planning.

These costs can quickly mount up and add to the total fulfillment cost. And if anything goes wrong, like a package being delayed or lost, your business stands to lose even more.

When businesses are forced to hike their shipping fees to cover these escalating last-mile delivery expenses, it often leads to an unintended consequence: customers abandoning their carts. The sight of unexpectedly high shipping costs at checkout can send many shoppers running for the hills.

So, what can you do to keep your delivery costs in check? Find the right shipping partner.

Teaming up with a third-party logistics company can give you access to large-volume discounts, route optimization software and a higher delivery capacity.

2. Late or Failed Deliveries

Missteps and postponements in last-mile deliveries present a huge problem for e-commerce businesses.

Suppose a delivery doesn’t go as planned. In that case, the courier has to try again the following day, essentially doubling your dispatch costs. Or, if a customer receives the wrong order, your driver will have to pick up the package and re-deliver it.

Not to mention the impact on customer satisfaction, which can be just as damaging for your business. The last thing you want is disgruntled customers leaving negative reviews of your brand online.

At this point, a tech-based supply chain and automated warehouse operations can drive more efficiency in last-mile deliveries.

Being able to automate packing and labeling, coordinate pickup or re-deliveries, and track real-time locations of drivers will save you time and money, and‌ help prevent customer frustration.

3. Instant Visibility

Handing a customer a tracking code to monitor the progress of her shipments is no longer enough. Today’s shoppers expect real-time visibility of their orders, near-constant updates on the status of their shipments, and faster delivery times.

To truly elevate your customers’ delivery experience, consider utilizing specialized delivery management software. This will enable you to give them complete visibility in every stage of their shipment’s journey and ensure they never miss a single update.

Through your delivery platform, you may also send automated emails, WhatsApp messages and SMS alerts to customers, informing them of their package status. This helps provide a sense of reassurance and keeps them in the loop.

4. Unforeseen Circumstances

Navigating through traffic jams, dodging construction sites, and managing unfavorable weather conditions can bring your last-mile delivery operations to a screeching halt. As a result, it can be difficult to make accurate, real-time predictions about order arrivals or to manage customer expectations.

In these situations, having access to reliable shipping software with carrier management services can be a lifesaver. It can help you make more accurate delivery estimates, optimize delivery routes in real time, and switch between carriers with minimal disruption.

5. Return Logistics

According to research, e-commerce return rates range between 20% and 30%. This little nugget of information should merit considerable thought on your end regarding how you manage returns.

A good return experience is just as important as a good delivery experience; if handled poorly, it can result in high costs and customer churn rates.

This is where investing in shipping software with a dedicated returns portal can make all the difference. Giving customers an easy way to initiate returns can streamline the delivery process and eliminate the need for manual input from you and your team.

6. Out-of-Date Software

If it isn’t obvious yet, the shipping and logistics software you choose can circumvent many last-mile delivery problems. Outdated software can make it difficult for you to keep up with customer expectations that are constantly evolving.

According to Statista, e-commerce sales are expected to grow to 8.1 trillion dollars by 2026. Now, if that’s not incentive enough to invest in the proper shipping software, what is?

It pays to scout the market for a shipping solution that matches your business requirements and customer demands. Features like shipping automation, multi-carrier integration, real-time tracking, and automated updates can go a long way in providing an efficient last-mile delivery experience.

So, don’t let obsolete software systems stand in your way.

Get on the Road to Last-Mile Delivery Success

The key message here is that while last-mile delivery can present a range of challenges for online stores, it is by no means unsolvable.

By investing in the right shipping and logistics software, you can effectively tackle unexpected costs, late deliveries and customer dissatisfaction.

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