Controlling Final Mile Costs

Controlling Final Mile Costs

In the first post in this series, exploring the intricacies of final mile shipping (also known as last mile shipping), we defined final mile logistics and provided an overview of the common pitfalls and challenges shippers must navigate to successfully execute final mile shipping. In this article, we will address the key factors which drive final mile costs- and how to effectively reduce them while improving customer service.

According to the Capgemini Research Institute, consumer products companies and retailers “have to catch up with consumer demand for better and faster last-mile delivery services while at the same time mitigating associated profitability risks. Our research shows that close to three-fourths of consumers are willing to reward retailers who get the last-mile experience right with increased spend and loyalty…But, last-mile delivery is the most expensive part of the supply chain.”

Consider these factors that can drive higher final mile costs

Best Practices to Lower Final Mile Costs

  1. Increase visibility into inventory before loading the truck. Greater inventory visibility ensures drivers know what to expect when picking up or delivering final mile freight.
  2. Know your customers. Knowing the delivery limitations of your customers’ homes and businesses helps eliminate unpleasant surprises and mitigate accessorial charges.
  3. Transition from an “LTL only” approach to a multimodal approach which utilizes LTL carriers for the linehaul and dedicated final mile carriers for the delivery. If creating your own LTL/final mile network is not feasible, consider partnering with a 3PL like GlobalTranz to provide this service.
  4. Reduce the paperwork in managing final mile. This includes using a single BOL and a single invoice for both the LTL linehaul and the final mile carrier, which requires integration through a TMS.
  5. Leverage technology. When working with a 3PL like GlobalTranz, you gain access to the robust, multimodal GlobalTranz TMS, which includes dedicated final mile capabilities, including integrations with LTL linehaul carriers and final mile providers.

Choose GlobalTranz to Reduce Your Final Mile Costs

Shippers want to lower their shipping costs while maintaining customer service but finding the best way to manage final mile costs can feel like searching for a needle in the haystack. When it comes to final mile, going it alone can be a costly and time-consuming endeavor.

GlobalTranz combines people, processes, technologies and key relationships with LTL and final mile carriers to streamline your final mile freight management, reducing delays, and ensuring competitive rates. Learn more by requesting a consultation with GlobalTranz today.

Final Mile Guide: Managing Costs and Operational Efficiency