Last Mile Delivery
Also known as: Final Mile, Last Mile Logistics, Final Mile Delivery
Definition
Last mile delivery refers to the final step of the shipping process—moving a package from the last distribution center or hub to its final destination (usually a home or business). Despite being the shortest distance, it’s often the most expensive and challenging part of the entire shipping journey.
Why Last Mile Is So Expensive
The last mile can account for 50%+ of total shipping costs because:
- Low efficiency - One package per stop vs. bulk transport
- Unpredictable traffic - Urban congestion, parking challenges
- Failed deliveries - No one home = return trips
- Residential complexity - Apartments, gates, rural areas
- Customer expectations - Same-day, delivery windows, white glove
Last Mile Economics
| Delivery Type | Cost per Stop |
|---|---|
| Urban residential | $7-15 |
| Suburban residential | $5-10 |
| Rural residential | $10-25 |
| Commercial/business | $4-8 |
These costs increase significantly for time-specific delivery windows.
Last Mile Solutions
Traditional Carriers
- USPS, UPS, FedEx handle most last mile
- Established networks but higher costs
- Broad coverage including rural areas
Gig Economy/Crowdsourced
- Amazon Flex, DoorDash, Uber
- Flexible capacity
- Often cheaper for urban areas
Delivery Lockers
- Amazon Lockers, UPS Access Points
- Customer picks up at convenient location
- Eliminates failed delivery attempts
Hybrid Services
- UPS SurePost, FedEx SmartPost
- Major carrier to post office, USPS final mile
- Cost savings for residential delivery
Last Mile Challenges
| Challenge | Impact |
|---|---|
| Failed deliveries | Each attempt costs $5-10+ |
| Theft | 14% of US consumers report stolen packages |
| Urban parking | Drivers waste time finding spots |
| Customer availability | Narrow delivery windows increase costs |
| Address accuracy | Wrong addresses cause delays and costs |
Improving Last Mile Efficiency
For Businesses:
- Offer pickup location options
- Use delivery management software
- Optimize route planning
- Consider same-day only for local deliveries
For Customers:
- Provide complete delivery instructions
- Use delivery notification apps
- Consider locker/pickup alternatives
- Be available during delivery windows
The Future of Last Mile
Emerging solutions:
- Drones - Amazon, Wing testing aerial delivery
- Autonomous vehicles - Self-driving delivery bots
- Micro-fulfillment - Inventory closer to customers
- In-home delivery - Amazon Key, secure access
Ready to ship?
Compare carriers side by side
Try Free