Top Strategy for Retail Brands: Optimize Last-mile with Delivery Solutions

With the rise of e-commerce, consumers expect faster and more convenient delivery options than ever before. If your fulfillment strategy isn't up to par, you could be losing business to competitors who prioritize it.

You can streamline your operations and improve customer satisfaction by leveraging an omnichannel experience platform and implementing strategies to optimize fulfillment and last-mile delivery.

In this article, we'll explore the impact of inefficient fulfillment, the benefits of prioritizing improvements, along with 10 tactics for optimizing your processes.

Why prioritize last-mile fulfillment as your top retail strategy?

In today's digital world, loyal customers demand a seamless and hassle-free shopping experience, which includes fast and reliable delivery. Delivery speed and cost are the two most important buying factors for customers.

Prioritizing fulfillment and delivery services to customers can unlock a range of benefits for your company:

1. Elevate customer experience

Delivering orders accurately and conveniently is essential to customer loyalty. For example, 50% of business leaders agree that customers expect same-day delivery and that it results in better customer retention. Customer support surrounding the fulfillment process is also vital; nearly a third of buyers say that poor customer support with deliveries encourages them to switch providers.

2. Solidify brand reputation

Focusing on final-mile customer service can boost your reputation. Lost, damaged, and delayed deliveries are top contributors to poor brand image. On the flip side, 82% of shoppers say they share their positive delivery experiences on online customer feedback forums. Positive customer reviews can help boost your brand reputation.

3. Reduce business costs through efficiency

Optimizing shipping and logistics can boost revenue and lower costs. For example, using three shipment centers across the US can cut costs by 25%, as goods are shipped from locations closer to customers, reducing distance and saving on fuel.

4. Uplift revenue

Reliable fulfillment and delivery can increase revenue. Customers will buy more from a company with reliable delivery services and pay higher prices for products with faster delivery. In contrast, those who shop with companies with poor delivery processes plan to reduce spending by 45%.

5. Predict future trends

Gaining insights into customer purchase behavior can help predict inventory trends to inform product development and marketing tactics. Analytics technology provides a deeper understanding of which products customers return to, need quickly, or are gaining traction.

6. Scale operations

The right final-mile delivery strategies make it easier to scale operations. Companies that use third-party logistics providers can leverage their expertise and equipment to handle increased order volume and customer demand.

7. Increase sustainability

Sustainability is increasingly important to shoppers. Two-thirds say that sustainability is one of the top five factors affecting their purchasing decisions. Optimizing routes and packing methods, switching to greener packaging, and streamlining management can reduce your carbon footprint.

8. Gain a competitive edge

The right fulfillment strategies can put you above your competitors. 44% of companies say that offering same-day delivery gives them a competitive advantage. Understanding changing customer experience demands through insights and analytics can help you determine which services are most important to your customer base.

4 major costs of ignoring last-mile in your retail strategy

Ignoring fulfillment and delivery processes can lead to significant costs for your business:

1. Disjointed customer experience

Customers expect fast, affordable, convenient shipping options, and 83% expect regular communication about their orders. Without streamlined fulfillment processes, you can't meet these expectations, leading to high customer support traffic and lost revenue as customers shop elsewhere.

2. High operational costs

40–55% of supply chain costs happen at the last-mile. Neglecting to streamline these operations increases costs due to fixing mistakes and managing customer complaints. Inefficient fulfillment, inaccurate inventory management, inadequate staffing, and poor logistics all drive up overheads.

3. Poor brand reputation

Inconsistent or unreliable delivery times, incorrect deliveries, and poor communication can hurt your brand image, eroding customer loyalty and repeat business.

4. Loss of competitive edge

Customers want affordable (or free) delivery. 61% would switch brands to avoid paying for costly shipping. If your fulfillment processes aren’t efficient and cost-effective, you’ll have to pass those costs on to the customer, making you less competitive.

How to optimize your last-mile retail strategy

Maximizing your last-mile delivery strategy is key to improving customer satisfaction and reducing costs. Here’s how:

1. Create a truly omnichannel strategy

Omnichannel retail strategies drive sales. Brands make 12% more when they add an additional sales channel. Coherent fulfillment options across all platforms give buyers freedom to choose their preferred delivery method and enable real-time visibility into inventory levels.

2. Automate fulfillment processes

51% of businesses say their fulfillment costs have increased, with labor being the biggest factor. Automating fulfillment processes can reduce labor demand, speed up processes, and lower overheads. Methods include automated order processing, inventory management automation, robotics for picking and packing, route optimization, customer service bots, and predictive analytics.

3. Utilize data to enhance processes

Analyzing patterns in your fulfillment mechanisms helps identify what works and what doesn’t. Demand forecasting, inventory tracking, and returns analysis can identify bottlenecks and reduce waste. Customer segmentation data can personalize services and improve systems.

4. Personalize post-purchase communication

Automating and tailoring post-purchase communication based on customer behavior data reduces the workload on your customer service team and improves the customer experience by lowering support wait times.

5. Optimize inventory management

Nearly a quarter of customers agree that product unavailability and slow delivery times have the biggest impact on their shopping experience. Demand forecasting and inventory management tools can streamline fulfillment, reduce overstocking and understocking, and improve profitability.

6. Offer multiple fulfillment options

Customers want convenient fulfillment options. Offering multiple ways to receive products—such as BOPA, BOPIS, curbside pickup, same-day delivery, and locker collection—is crucial. 42% of retailers say that having multiple fulfillment options is the most important aspect of their omnichannel brand strategy.

7. Optimize packing

Efficient packing of delivery vehicles reduces costs and improves sustainability. Optimizing how trucks are loaded can reduce the number of vehicles needed, saving money and benefiting the environment.

8. Partner with third-party logistics providers

57% of businesses already use a third-party provider (3PL) for some or all of their e-commerce fulfillment needs. 3PLs offer dedicated services and specialist solutions, enabling retailers to meet unique delivery needs more efficiently.

9. Optimize delivery routes

Route optimization software enables companies to create efficient delivery routes, reducing delivery times, fuel costs, and carbon emissions.

10. Implement real-time tracking

Customers want real-time tracking. If you have an order tracking page, customers are three and a half times more likely to track their orders. This decreases the burden on your customer service team and reduces missed deliveries.

Leveraging unification for fulfillment efficiency

Omnichannel unification and orchestration can significantly enhance fulfillment efficiency. Delivery Solutions' platform is a centralized hub that enables retailers to manage and optimize their “after cart” operations seamlessly. By integrating with order, warehouse, and transport management systems, businesses can streamline fulfillment from various channels in one place.

Offering analytics and operational tools for post-purchase processes, logistics, delivery, pickup, returns, and more makes it easier to identify bottlenecks and tailor processes to your business model. Businesses can connect with and manage all 3PL providers on one unified, flexible platform. Automated customer communication and real-time tracking enhance customer experience, reducing inquiries and increasing satisfaction.

Enhance your last-mile retail strategy

Implementing a streamlined fulfillment and last-mile delivery strategy should be the top priority for any retail business looking to succeed in today's competitive landscape.

Prioritizing fulfillment operations and utilizing technology solutions like Delivery Solutions platform can reduce costs, improve customer satisfaction, and help you gain a competitive edge.