Business Decisions within Last Mile Delivery
Effective business decisions are key to understanding and improving delivery within the last mile sector. Five key last mile aspects to track that help inform last mile delivery decisions include:
1. Vehicle emissions over time
2. Number of deliveries per week by customer/order
3. Customer satisfaction through reviews
4. Missed or damaged items
5. Driver hours and potential overtime
Vehicle emissions include carbon dioxide emissions which are a significant amount of greenhouse gas emissions expelled within last mile delivery routes. With the number of deliveries and vehicles increasing, emissions also increase. The CEO of Climate Neutral, a nonprofit in California, determined last mile emissions account for about 5% of supply chain emissions. By computing & tracking vehicle emissions and displaying them graphically in the user interface, we can see how consolidating loads and changing trucks over time to more efficient ones can further reduce emissions.
The number of deliveries per week is a measure to determine aspects of each customer that are helpful in decision making. While it may be subject to change, it is important for clients to determine their top 50 customers. By determining customers by revenue/order value, frequency of delivery, capacity of load/vehicle utilization, satisfaction scores, and distance from depot of delivery it allows the ability to compare them against customers who potentially present a risk if unsatisfied. For example, client A orders 2x /per week but order value is only $450 but is 16 miles from depot vs Client B orders 7 or more times per week, each order value is $1,100 but one mile away. By looking at all these data points over time, rather than one data point when a situation arises, we can track the most profitable and loyal customers to be factored into further optimization.
Customer satisfaction through reviews enables the client to (identify and investigate customer dissatisfaction in real-time and reach out to them. That way, preventative measures can be taken before escalating any further. Measures can also be put in place to ensure customers who have submitted lower scores, neutral or negative reviews (or constructive feedback) have their perspective acknowledged. When lower reviews are given, an action will then be taken moving forward to close the feedback loop from the initial touchpoint with the customer. This can potentially be in the form of notes to the drivers, for instance, if it is an issue of driver politeness the manager will take action to rectify the situation and make a note to the driver. Customer feedback tracking inevitably informs many stages in the delivery process such as promptness, last minute changes, quality of items delivered, damaged or missing items, and driver politeness.
Damaged or missing items are an important tracker to ensure reliability moving forward. It also effects customer retention. According to Forbes, statistics show customer retention even increasing by 5% can boost profits by 25%-95% over time. The overall cost of customer acquisition is greater than customer retention strategies, thus it is more profitable is more profitable than new customers, and
Driver hours and potential overtime must be logged in an organized manner. This helps avoid delays and missed deliveries if a driver’s weekly time is at its limit. It is also important information that will inform management of any changes needed such as hiring more drivers and changing schedules. By effectively logging hours, drivers are paid correctly and room for errors is significantly decreased as well as allowing for correct legislation/compliance by country and region. By digitizing and automating the process to recording hours and overtime, it allows for more accuracy and efficiency within the system. This, in turn, increases driver wellbeing and safety and helps improve job satisfaction.