The Two Most Important Factors in Last-Mile Delivery

A satisfied customer is no longer the main priority in last-mile delivery. According to the Last-Mile Trends Report 2024, supply chain leaders rank cost and speed as the two most important metrics of success.

The data, presented at 'The Last Mile Leaders Event' by Microsoft and FarEye last week, is based on insights gathered from over 300 leaders across five continents, representing companies with $100 billion in combined revenue.

“In last-mile delivery now top priority is cost and speed. The needle has shifted from cost and satisfaction to cost and speed,” the report said.

More than half of the surveyed companies are now offering same-day or next-day delivery, underscoring the growing importance of swift service. Additionally, 80% of supply chain leaders prioritize measuring delivery costs.

Kushal Nahata, Co-founder and CEO of FarEye, predicts that within five years, autonomous drones will handle 30% of urban deliveries, reducing both time and expenses. In response to these trends, the company has launched the 'Last-Mile Innovation Nexus' to support startups in securing funding and mentorship from logistics experts worldwide.

Sustainability another major priority

At the same event, over 40 supply chain experts from diverse industries gathered to explore the role of technology in driving down costs. With urban delivery projected to increase carbon emissions by 32% by 2030, industry leaders stress the urgency of sustainability measures.

The uptake of electric vehicles and government incentives like the FAME scheme signals a growing commitment to greener logistics. According to Nahata, sustainability isn't just an option anymore—it's a necessity and a competitive edge.

However, not all companies are jumping on the trend. A recent survey from software provider Sedex found that 40% of senior procurement leaders at North American companies are ignoring sustainability in their procurement operations, and 37% said they are unaware of sustainability-related legislation that impacts their businesses.

Another recent survey, this one from the IBM Institute for Business Value, helps underscore the point that there is plenty of room for improvement. The study found that nearly half (47%) of the executives surveyed struggle to fund sustainability investments while 60% concede to making trade-offs between financial and sustainability outcomes.

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