Last-mile delivery continues to face a number of long-standing challenges. Not least among these challenges is the reality that last mile logistics are notoriously inefficient, cost intensive and damaging from an environmental perspective due to increasing traffic congestion and pollution.
Indeed, the final leg of a delivery accounts for more than half of a product’s total shipping costs. Urban freight causes approximately a quarter of CO2 emissions and 30%-50% of other transport related pollutants.
At the same time, the exponential rise of e-commerce in recent times is only increasing the demand for same-day, fast delivery services within the last mile. This, along with the legacy impact of the COVID-19 pandemic which undoubtedly fast-tracked wider awareness of delivery services, is driving companies to seek ways to optimise the last mile and make it more efficient.
Revolutionising the last mile
In many ways the above has created a jumpstart for changes in the last mile to take hold. Companies increasingly want to bring storage and fulfilment closer to the end recipients. Doing so alleviates efficiency, cost-related and environmental challenges.
For consumers living in urban environments in particular, the end result is an increase in the number of on-demand delivery services available to them. This will include battery-powered robots, delivery drivers on e-bikes, e-scooters, or even drones. All these solutions have the overarching aims of increasing convenience, reducing costs and lessening environmental impact.
It is the latter in particular that perhaps is garnering most focus currently. There is increasing pressure at a government level worldwide to accelerate action towards achieving the goals and targets outlined in the Paris Agreement and the UN Framework Convention on Climate Change at a societal level.
In the last mile, that means finding ways of getting goods to consumers with as little environmental impact as possible, while still providing a convenient, hassle free and cost-effective service. This is where the impact of what PwC has previously described as the ‘Uberisation’ of last mile delivery and the gig economy needs to be explored.
There is no silver bullet for the last mile monster
Ultimately, we can expect to see last-mile delivery continue to evolve and be multi-modal; there is not one type of delivery mode that will be able to meet all needs all of the time. Cars, robots, scooters, e-bikes, drones and other types of delivery methods will inevitably be the right solution at different points depending on each type of different delivery situation.
However, zero-emission vehicles or other delivery solutions carry a lower upfront cost compared to diesel or fuel powered lorries, vans and cars, with running costs typically much lower too as well as less outlay for associated costs including maintenance and insurance.
Additionally, it is practically much easier and cheaper to get a rapid delivery to a customer in a 1-3 mile radius in under an hour by using the pavement rather than by road or air where the safety requirements and regulations are much more complex.
The role of delivery drones
Drones in contrast play a role in more specific conditions, such as more remote areas where road infrastructure less developed. This also includes the transportation of more specific and less consumer facing cargo such as medical supplies; although it’s true that the Royal Mail is also trialling drone delivery for mail in remote parts of Scotland currently.
However, there is also an argument that fast, short distance and low basket value deliveries over the last mile can’t be done by humans and remain economical or sustainable.
It’s a well-known facet of the rapidly growing gig economy. In the more traditional, ‘human powered’ delivery industry, workers face systemic challenges. They are at risk of being overworked, poorly paid, and don’t have access to longer term contracts that protect their rights. Using autonomous delivery methods for low basket value deliveries over the last mile is one way of ensuring that people are left to work in better conditions and potentially different roles within the wider industry.
Where to next?
Ultimately, consumer behaviour will continue to drive the innovations and changes we can expect to see in the last mile moving forward. The demand for same day or instant delivery is only likely to increase as alternative and autonomous delivery services become more mainstream.
In turn, this further incentivises the business case for such solutions. In time, this will enable new delivery services in the last mile, deployed at less cost to and with less hassle for consumers.
While technology advancement is key, the end goal is not to embrace technology for its own sake. Rather, it’s to make last mile delivery as smooth, easy and hassle free for consumers as it is for businesses to provide, while also being kind to the planet.
