Top Holdups in US Last Mile Fulfillment

👉Avoid These Common Holdups In US E-Commerce Last-Mile Fulfillment

By Chris Crutchley on November 7, 2021
Last-mile is probably more difficult now than it ever has been before. The “Amazon effect” has created an expectation for fast and free delivery — one study found that 56 percent of shoppers won’t buy from a brand again if they’re not satisfied with th...

The final stage of the logistics journey from the fulfillment center to the consumers’ hands seems like it should be brief and easy. After making a long and sometimes treacherous voyage overseas, a truck ride from the warehouse to the home should be a breeze. However, this last step can be a minefield for e-commerce businesses in the US.

Last-mile is probably more difficult now than it ever has been before. The “Amazon effect” has created an expectation for fast and free delivery — one study found that 56 percent of shoppers won’t buy from a brand again if they’re not satisfied with the shipping service. Package tracking and fast delivery have become synonymous with good customer service.

This current trend is contributing to growing inefficiencies in the last mile. Fulfillment centers like Amazon’s are finding themselves short on workers, warehouse vacancies are at an all-time high, and truck drivers are in short supply. 

Besides manpower, unforeseen factors like weather and traffic can put packages further and further behind schedule. If you want to be competitive in this market, you need to avoid the common roadblocks below that most businesses face in the US.

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Typical Holdups in USA Last-Mile Shipping

Lack of control and poor tracking 🔍

Trying to control every step of your last-mile logistics is costly and often impractical - yet oversight is very important. If you do not know what is going on with your “parcels” every step of the way, then your ability to fix problems is limited.

Package tracking is easy with some 3PL providers, more difficult with others. With services like UPS and FedEx, you may have an easy time knowing where your package is but you pay a premium for that information. The same is not true for cheaper services like USPS, which has limited tracking capabilities. You need to understand your current provider’s regional limitations, and to be able to communicate with them and clients when problems arise.

Warehousing inefficiencies 🏠

New warehouses are popping up all over the U.S. right now — both rurally and in cities. However, rural addresses receiving deliveries may still be several miles apart and many miles away from the nearest fulfillment center or post office. 

Even though urban warehouses are much closer to customers living in cities, factors like traffic jams and construction mean that each delivery may not be so easy to pinpoint.

Today, more goods than ever are arriving in the USA but warehouses are running low on space. This means that individual shipments have to wait longer before they are sent out to customers. Warehouses are adapting newer technologies to mitigate efficiency problems like automation software for sorting, storing, and retrieving packages. However, they still have work to do before they can efficiently handle the volume of products coming through today.

Transportation bottlenecks 🚚

Transportation holdups in the USA are usually due to long distances and traffic. Due to its extensive highway network, most shipping is done via road freight in the United States.

However, trucking is expensive and cumbersome — especially when dropoff points are several miles apart from each other, or scattered throughout a traffic-choked metropolis like New York City.

To ensure that you aren’t getting unnecessary freight costs you or your provider need to optimize your delivery routes. That means taking the time to consider typical weather, terrain, traffic patterns, and warehouse vacancies. This kind of vetting is challenging but will save your business money and time.

Regulatory bottlenecks ✍

When choosing providers in the US, you need to make sure you pay close attention to where your customers are and who has coverage in the region.

The US, like most other developed countries, has many regulatory hurdles in the logistics industry. These are made to make deliveries more secure but can have a slowing effect on regional coverage.

Not just anyone can fulfill orders in the US. Drivers and warehouses usually need special certifications, training, and clearance to work with 3PL providers. That makes it difficult for logistics companies to expand into new regions, specifically rural ones where experienced staff are difficult to source.

Timing issues 🕐

For time-sensitive goods, proper warehousing and great customer-facing package tracking are a must for providers.

Purchasing perishable goods like groceries and pharmaceuticals online grew quickly during COVID. However, a shortage of “cold warehouses” and the innate challenge of storing, shipping, and delivering highly perishable goods makes this space very complex. Delivering expired products is a great way to lose a customer.

If a customer is not home to sign for a package or if a package containing perishable goods is delivered at a time when the customer cannot see to the package those goods may just become no good. Either a new product needs to be sent, or a new delivery date needs to be set.

RELATED: What to Look For in a Last Mile Provider

Natural phenomena ☔

The USA is a huge country with regions that experience their own unique weather problems. Your logistics provider in the US needs to have both the flexibility and the regional knowledge necessary to mitigate them.

The West Coast suffers from frequent earthquakes and forest fires, much of the southern USA falls prey to frequent hurricanes, the midwest area gets hit with tornadoes, and the northern and northeastern areas often experience severe snowstorms in the winter. You can see how only one method of handling holdups may not work in every region. While a bad rain may shut down a road or two, a bad snowstorm can close a whole region for days.

The Pandemic Sent US Logistics Into a Tailspin That Won’t Stop

In the past, the American logistics system functioned markedly better than many others. But partly due to the worldwide pandemic, consumers are ordering online en masse introducing unpredictability, higher costs, and lower efficiency to the supply chain.

Americans’ online spending has yet to revert to pre-COVID days. By August 2021, inflation-adjusted spending on goods was up 14.5% compared with pre-pandemic levels. As of September 2021, import volumes are up 17% compared to the same time last year. The e-commerce logistics industry is dealing with a very long spike in orders that it was not designed to handle and even the most experienced logistics providers are struggling.

CBIP Can Help You Find Providers That Aren’t Struggling in the US

Navigating logistics in the United States during these uncertain times can be difficult and costly for e-commerce businesses — especially those just starting out.

We created our business, CBIP, to directly meet the challenges businesses like yours face finding consistently good providers. We do this by managing contracts for you with regional providers we know can meet your specifications.

We aren’t just a middle man service either. We’re an all-in-one logistics interface for your business giving you tools like:

✔️ Easy package tracking

✔️ An in-house store and order management system

✔️ Risk assessment and analytics

Do you want to learn more about your customized logistics plan? Check out our website and schedule a free, no-strings meeting with one of our consultants.

About Author

Chris Crutchley

Chris Crutchley is CBIP’s director of operations and finance. He has over a decade of corporate finance and operational expertise throughout the Asia Pacific.

In logistics, Chris strives to continuously innovate and challenge the industry’s norms in order to offer clients world-class service that emphasizes clear communication.

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