With e-commerce increasingly becoming a more significant percentage of U.S. retail sales, last mile delivery fleets have never been busier. E-commerce is projected to grow to 19.2% of all U.S. retail sales by 2024, and the North American last mile delivery market is projected to grow by $58.91 billion between 2021 and 2025. To meet the demand and be competitive, fleet managers must ensure their last mile delivery fleets run at top-notch efficiency.
Last Mile Growth = A Bottom Line Opportunity
The explosive growth of last mile delivery offers significant opportunities for companies and trucking fleets looking to add last mile divisions. But with opportunity comes challenges.
The “last mile” is the most crucial part of the delivery process and usually the most expensive. With increased volumes and tighter delivery deadlines, there’s more pressure than ever before to be competitive. In addition, 95% of consumers say they will look elsewhere if the delivery does not fit their needs. So providing seamless delivery and exceptional customer experience are important jobs towards growth and profitability. A highly efficient fleet is how you can accomplish that.
To that end, let’s look at four key steps you can take to ramp up your “last mile” fleet’s efficiency.
1. Vehicle Acquisition
With consumers purchasing a wide (and growing) range of products online, last mile delivery fleets need to handle the delivery of any type of product. So, first things first — ensure you have the suitable vehicles for the right job. This can be accomplished by analyzing your current vehicles’ freight and routes, talking with your drivers to understand the conditions unique to your operations, determining the types of vehicles you may need to add, and which vehicles need to be replaced.
Additionally, you might want to consider adding electric vehicles (EVs). Not only are they good for the environment, but they are also good for business. EVs provide numerous advantages, including lower fuel and maintenance costs, increased vehicle life, and improved corporate image. Before putting your foot on the EV accelerator, there are factors to consider when determining if EVs would benefit your fleet. These include:
- High initial investment cost
- Access to charging stations or the costs and feasibility of hiring a charging solutions provider
- If the types of EVs in the marketplace match your needs
- The range of vehicles and if your routes are adaptable to EVs
2. Fuel Management
Having a solid fuel management program from a reputable provider can save you money, improve driver productivity, raise route efficiency, and boost customer satisfaction. To get the maximum uptime for your vehicles and the most from your fuel dollars, look for a program that provides the following:
- A discount on fuel purchases
- An extensive, nationwide network of fueling sites for quick and easy fueling for your drivers
- Multiple fuel program options (retail cards, mobile, emergency, bulk, green)
- Data/reporting and inventory management capabilities
Reducing downtime and keeping your fleet road-worthy requires staying on top of vehicle maintenance. Telematics is a valuable technology to accomplish that by allowing you to automate the tracking of maintenance schedules. This keeps vehicles road-worthy, prolongs vehicle life, helps spot issues before they become problems, increases driver safety, reduces labor, lowers the number of repairs needed, and decreases vehicle replacement costs.
Maintenance can be scheduled for vehicles at times that have the least impact on productivity and can be based on factors that most affect uptime and performance. These factors range from engine status, oil temperature, fuel level, water in diesel fuel, and tire pressure.
4. Compliance and Safety
To keep drivers and vehicles safe, you need to keep up with federal and state compliance regulations — which is not an easy task, no matter the size of your fleet. With telematics, current driver and vehicle compliance are easy to access in one place. It will provide information such as pre-employment testing, annual inspections, registration expirations, and violations right at your fingertips. When a deadline approaches, you won’t be wasting valuable time fumbling through paperwork and won’t be putting your operations at risk from non-compliance.
Regarding safety, one accident is one too many. A safety program backed by telematics can help you prevent accidents by identifying high-risk drivers and correcting unsafe driving behaviors through coaching and training. All of the safety features on newer vehicles help promote better driving practices, but the data collecting and reporting capabilities of telematics allow you to understand driver behavior, get real-time alerts, and take action to correct and change unsafe driving behaviors before they are costly.