Last mile (transportation)

Last mile is a term used in supply chain management and transportation planning to describe the movement of people and goods from a transportation hub to a final destination in the home.

The term "last mile" was originally used in the telecommunications field but has since been applied to supply chain management. Transporting goods via freight rail networks and container ships is often the most efficient and cost-effective manner of shipping. However, when goods arrive at a high-capacity freight station or port, they must then be transported to their final destination. This last leg of the supply chain is often less efficient, comprising up to 28% of the total cost to move goods. This has become known as the "last mile problem." The last mile problem can also include the challenge of making deliveries in urban areas where retail stores, restaurants, and other merchants in a central business district often contribute to congestion and safety problems.

A related last mile problem is the transportation of goods to areas in need of humanitarian relief. Aid supplies are sometimes able to reach a central transportation hub in an affected area but cannot be distributed due to damage caused by a natural disaster or a lack of infrastructure.

As e-commerce continues to grow, the last leg of delivery, ending up at the consumer's home or business, has become more challenging. Since most consumers are away from home when deliveries are usually made, unattended delivery has become a significant issue among delivery companies like UPS, FedEx, USPS, DHL and others. Leaving a parcel unattended exposes the item(s) to weather, and to the increasing chance of theft by "porch pirates" (a person or persons who steal packages off of unsuspecting customers' porches or front door areas). Retail companies like US based Amazon and China based Alibaba have researched and deployed drones for delivering goods purchased online to consumers. Amazon has also set up lockers and some urban centers as a way of consolidating packages. The Consumer Electronic Show in January, 2015, featured one company, TrackPIN which has developed a cloud-based garage keypad that can connect a garage to UPS or FedEx to have it automatically generate a unique, one-time use code so their package can be delivered under their garage door. Automated parcel delivery is becoming a popular option these days. Europe has led the way in this with Germany, Britain and Poland being the first markets for these services. Automated parcel delivery solutions are finally moving the Asian subcontinent as well. Indian and Chinese e-commerce industry will greatly benefit from the same.

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