How to Start a Last-Mile Delivery Company: Best Practices

Last-mile delivery is often dubbed the most expensive mile in the supply chain and brings a boatload of challenges for any logistics company. In addition, the increasingly competitive market is often subject to hiccups like a shortage of delivery partners, high customer demands, and unpredictable economic conditions. 

How can logistics companies overcome these challenges? By managing their logistics operations diligently and considering crucial elements like fleet productivity, fuel costs, delivery service types, vehicle performance, and customer experience. 

While the route to an optimal last-mile delivery operation has always been vague, we have done the heavy lifting to determine the best practices to make the last-mile delivery operation smooth. In the following lines, you will glimpse the best practices that can streamline your last-mile delivery experience and help you gain a competitive advantage in a crowded market.

Best Practices to Create a Profitable Last-Mile Delivery Business

Create a Plan

What was considered a game-changing strategy five years ago is today’s basic expected standard in the last-mile delivery segment. Most successful last-mile delivery companies do much more than just deliver goods; instead, they focus on providing an excellent customer experience to ensure repeat business and increase revenue. 

So, how do you get there? By having an ambitious and scalable plan in place. Find out what you can do to improve the quality of your delivery business and how you can add more value to the customer experience. Observe the competitors that are successfully offering last-mile delivery services and fill in the gaps in their operating model to find your competitive advantage.

Once you have done that, integrate the right delivery management system into your technology stack and automate as many aspects of your delivery business as possible.

Choose the Right Technology

As mentioned above, finding the right technology is crucial to creating a winning last-mile delivery strategy. The majority of the last-mile strategies require AI-powered route optimization, push notifications, digital proof of delivery, data analytics, and more related features to stand a chance in the competitive landscape. 

Not only can NetworkON offer you a wide range of last-mile delivery-related features, but it can also help you create a sustainable business model that can generate incremental revenue, slice down your operating costs and improve customer experience exponentially. 

Get the Right Metrics in Place With Robust Analytics

Last-mile delivery operations produce a lot of valuable data. If you can leverage it using the right technology, you can find the metrics that significantly impact your business. Using data and focusing on the right metrics, you can spot upcoming opportunities and market trends to create a sustainable growth plan for your business.  

Also, with an eye on the right metrics, you can create improved measurement standards for each and substantially reduce operational costs. Go beyond the traditional metrics like revenue and dive deeper into customer experience, timely deliveries, fist-attempt deliveries, customer feedback and ratings, and more to become a leading name in the last-mile delivery business. 

Create Automated and Standardized Processes

Automation and standardization of processes are essential when you are implementing technology into your last-mile delivery business. NetworkON enables you to automate many aspects of your delivery business; you can have automatic order scheduling based on the geolocation of delivery partners, automatic push notifications for every delivery milestone achieved, and accurate ETAs for each delivery task with simple integration.

Automation is the first step to creating standardized procedures. Once you have implemented a delivery management system, you will see how the quality of your business operations and the productivity of your fleets increases. 

Use AI-Powered Solutions to Help Delivery Partners

The most critical element of last-mile delivery is the person in the field. You can come up with multiple strategies, but it is your delivery partners that will execute them in the field. So, how can you help them ensure that they deliver a delightful customer experience? By giving them the required resources and technology.

Dynamic route optimization and geofencing are the most critical elements of last-mile delivery. If your drivers can access them, they can reach their destinations quickly with minimum to no idling time. NetworkON also gives updates like traffic congestion and the shortest routes available and informs delivery partners about delivery times. 

You can also get access to crucial delivery data from the delivery fleets and use it to grade your fleet’s performance and execute better delivery strategies in the future. 

Create the Right Team

A plan is only as good as the team that executes it. So even if you have the right delivery management software and up-to-date vehicles, you can only be successful if you have the right team at the steering wheel.

Make sure that every person you hire has the zeal to learn and improve and adds value to the team. Then, train and educate the team about the technology you are using and ensure that they follow the best practices your company laid out. 

Once the learning stop, the team might become complacent and get used to a certain work culture. Granted, not all employees will stick around for a long time, but the ones that do should have ample training and growth opportunities to remain proactive about the company’s growth. 

Wrapping Up

Now that you clearly understand the best practices you can adopt to improve your last-mile delivery business and generate more revenue drastically, you can start working towards a brighter future immediately. 

On top of following these best practices, you must incorporate reliable and scalable delivery management software to ensure all your plans see the light of day. NetworkON is a one-stop solution that constitutes all the necessary features and more to create a sustainable and profitable last-mile delivery business. 

Some of the most notable NetworkON features to transform your last-mile delivery experience include

• AI-powered route optimization and geofencing capabilities
• Digital proof of delivery to eliminate paperwork and transparent deliveries
• Real-time order management and tracking
• Fleet and vehicle management capabilities
• Robust analytical tools for performance management 
• Automatic order assignment 

These features are just the tip of the iceberg; you can learn more about NetworkON features here. To know more about how your business will look like with a NetworkON integration, schedule a free demo with our experts today. Email us at info@networkon.io for more information.

Frequently Asked Questions:

Q. Why is last-mile delivery considered the most expensive ‘mile’ in the supply chain, and what challenges does it bring to logistics companies?

Last-mile delivery is often considered the most expensive due to the complexity of delivering goods directly to the end customer. Challenges include a shortage of delivery partners, high customer demands, and unpredictable economic conditions.

Q. How can having a comprehensive plan contribute to the success of a last-mile delivery business?

A well-thought-out and scalable plan is essential for success. By understanding customer needs, observing successful competitors, and integrating the right technology, companies can improve the quality of their delivery business and gain a competitive advantage.

Q. Why is choosing the right technology crucial for a last-mile delivery strategy, and how can NetworkON help?

The right technology, such as AI-powered route optimization and digital proof of delivery, is vital for success in the competitive landscape. NetworkON offers a wide range of last-mile delivery features and helps create a sustainable business model by reducing operating costs and improving customer experience.

Q. What role do analytics play in last-mile delivery, and how can leveraging data contribute to business growth?

Analytics in last-mile delivery help identify valuable metrics that significantly impact business. By focusing on metrics beyond revenue, such as customer experience and timely deliveries, companies can spot opportunities, reduce operational costs, and create a sustainable growth plan.

Q. How do automation and standardization of processes improve the efficiency of last-mile delivery operations?

Automation, facilitated by a delivery management system like NetworkON, enhances efficiency by automating order scheduling, providing push notifications, and ensuring accurate ETAs. Standardized processes follow automation, improving business operations and increasing fleet productivity.

Q. Why is supporting delivery partners with AI-powered solutions crucial, and how can it enhance the customer experience?

Delivery partners play a crucial role in executing last-mile delivery strategies. Providing them with AI-powered tools like dynamic route optimization and geofencing ensures quick and efficient deliveries. Access to real-time updates and delivery data helps grade fleet performance and refine future delivery strategies.