The Future of Last Mile Delivery

Key Findings

Last mile delivery requires a re-think

The last mile describes the movement of shipments from a sorting centre to the final customer. This is the most inefficient part of the delivery supply chain, and is estimated to account for up to 28% of the total shipment cost.

Challenges restricting deliveries

Numerous issues are making deliveries more challenging. City centre vehicle restrictions on highly polluting vehicles are reducing access to households and businesses; meanwhile customers are increasingly demanding free delivery, requiring firms to improve the efficiency of last mile delivery.

Sustainability and efficiency are key

Commercial mobility needs to become more sustainable through reduced fossil fuel energy use. Electric vans, bicycles and route optimisation systems can reduce overall emissions, leading to a cleaner urban environment.

Electric fleets to replace internal combustion engine (ICE) vehicles

The use of electric vehicles for commercial deliveries is slowly catching on, with major logistics firms including FedEx and DHL adding electric vans to their delivery fleets. However, for full take-up to occur, issues such as range, cost and charge point availability need to be better addressed.

Autonomous delivery: the future

Autonomous delivery vans, drones and droids can potentially offer a solution to last mile delivery by helping to reduce costs, while improving the pace of delivery. However, further technological advances are needed in AI, while regulatory compliance also remains a hurdle.

Different delivery models for different cities

The differing characteristics of various cities – population density, labour costs and affluence – can influence the most appropriate delivery mode. For instance, drone deliveries would work best in cities which are less dense.