SDCExec.com |

Your company's back-end supply chain may be so efficient that you are the envy of all your competitors. But what about the customer-facing portion? Taking a look at the "last mile" in your supply chain may be what it takes to ensure your customers come back to you  and not your competitors  time and again.

Although the "last mile" of a company's supply chain is the final and critical link between the company and its customers, it has historically been a neglected segment of a corporation's supply chain strategy. At the last mile, merchandise is delivered from regional distribution centers to local branches or directly to end customers. While most companies have optimized their supply chains up to the store front, surprisingly few have focused on last mile deliveries.

It's surprising because, on average, 28 percent of transportation costs are incurred in the last mile, according to the Council of Logistics Management, which greatly impacts a company's bottom line.

The last mile is also a major influence on a customer's perception of a company's brand. Because the last mile is the final point of contact with customers, their good or bad experience with inventory availability or delivery directly impacts brand loyalty. Customer questions such as, "Is the merchandise I want in stock now?" "Will my order arrive on time and undamaged?" and, "Is delivery fairly priced in relation to my purchase cost?" are all answered at the last mile.

There are new solutions, such as outsourcing, which will be crucial in unlocking inefficiencies in the supply chain. But in order to fully address the needs of the last mile, we must first examine its unique challenges.

Challenges in the Last Mile

The last mile encompasses numerous geographic markets and widely varying customer needs. This makes it difficult for logistics professionals to forecast delivery costs and control quality.

Though a flood of new technologies and services have cropped up in the past 10 years promising to streamline companies' supply chains, few solutions have specifically addressed the last mile. As a result, companies have adopted several different practices  though none fully address the unique requirements of the last mile: