Last-mile delivery, the final stretch from warehouse to consumer, presents businesses with a myriad of challenges. High shipping costs, time-consuming processes, and the escalating demand for seamless service underscore the need for a shift in how businesses approach this crucial stage.

Let’s explore the key shipping trends businesses should expect this year and the innovations that will help streamline the last-mile delivery process.

Drones and Autonomous Vehicles

The once speculative concept of drone delivery has rapidly evolved into a tangible and impactful reality within the logistics sector. Forward-thinking businesses are actively incorporating this technology into their operations, acknowledging the limitations of conventional delivery methods.

Walmart is one of the enterprises that has expanded its network to offer drone deliveries in seven states, having successfully completed over 10,000 deliveries since the launch of its programme in 2021. Similarly, Amazon has recently announced plans to use drones for UK parcel delivery, with a commitment to delivering packages in under an hour.

Drone delivery emerges as a solution to challenges posed by congested roadways, geographical barriers, and the increasing demand for swift delivery services. However, while it opens exciting prospects for commercial operations, it also introduces hurdles that require careful consideration.

Critical to the success of drone delivery is airspace management, as drones must navigate shared skies without disrupting existing aviation traffic. This necessitates precise navigation systems and adherence to clear regulatory compliance to prevent aerial congestion and accidents.

Privacy emerges as another significant concern, given that drones often carry cameras and sensors, posing a risk of unintentional surveillance or data collection from private properties.

Ongoing efforts are being made to establish clear guidelines and safety protocols, ensuring that drone delivery is not only effective but also secure and respectful of privacy.

Advanced Technology Integration

AI is a transformative force, offering solutions to navigate the complexities and challenges of last-mile logistics. Its versatile capabilities extend to optimizing delivery routes, resource allocation, demand pattern prediction, and mitigating environmental impact.

The integration of cognitive robotics is introducing intriguing possibilities for addressing intricate last-mile delivery scenarios. Equipped with advanced AI and natural language processing, cognitive robots can navigate complex environments like apartment buildings and office spaces, facilitating precise deliveries to specific individuals or locations.

Predictive analytics play a pivotal role in enhancing last-mile delivery efficiency by optimizing delivery routes. Through comprehensive analysis of traffic patterns, businesses can identify the most efficient routes for their drivers, resulting in reduced delivery times and overall operational enhancement.

Sustainability in Last-Mile Delivery

Last-mile delivery is frequently linked to elevated emissions and environmental harm, attributable to fossil fuel-powered vehicles like trucks, vans, and cars. These vehicles release carbon dioxide and other detrimental pollutants, contributing to air pollution.

Beyond emissions, last-mile delivery exacerbates traffic congestion, particularly in urban areas where a higher concentration of delivery destinations intersects with limited space for vehicles to manoeuvre.

To address these environmental concerns, both companies and policymakers are exploring alternative delivery methods. This includes the adoption of electric and hybrid vehicles and the use of bike and foot couriers. These alternatives hold the potential to significantly reduce emissions, alleviate traffic congestion, and enhance both delivery efficiency and customer satisfaction.

Moreover, concerted efforts are underway to promote the consolidation of deliveries. This involves grouping multiple deliveries to a single location, diminishing the number of trips and vehicles required for delivery.

Same-Day Deliveries

Recent studies indicate that nearly half of Gen Z (49%) and Millennial (48%) consumers have high expectations for quick deliveries, with a preference for same-day or next-day options. Additionally, features such as enhanced tracking and varied courier choices are gaining significance in the eyes of these tech-savvy generations.

Failing to meet delivery deadlines can result in a substantial loss of customers – up to 84%. To ensure that your delivery service aligns with customer expectations, it is crucial to establish genuine and achievable promises.

Firstly, businesses should expedite the shipping process by employing reliable route planners, which provides accurate and instant ETA information for customers. Meeting customer delivery expectations hinges on the proactive sharing of real-time tracking information, fostering trust and satisfaction in the delivery process, for those expecting same-day deliveries.

Innovative Packaging Solutions

The global smart packaging market, valued at $35.92 billion in 2023, plays a crucial role in enhancing the efficiency and transparency of the delivery process. Smart packaging employs advanced sensors and technologies to monitor package contents, including temperature, pressure, weight, and humidity. This enables precise tracking of the package's location and estimated time of arrival.

For instance, active smart packaging goes beyond the traditional role of merely containing and protecting products. It actively interacts with the product, preserving its quality, freshness, and shelf life. Another innovative approach is connected packaging, a form of intelligent packaging that links parcels with external consumer devices like smartphones, tablets, and computers.

This connection empowers businesses and customers to access real-time information about the parcel through these devices, fostering transparency and enhancing the overall customer experience.

The innovative concept of micro-fulfilment centres has also emerged as a groundbreaking solution to tackle the challenges inherent in last-mile delivery.

Walmart has already embraced this approach by establishing these centers within existing stores, strategically minimizing the distances that delivery drivers need to cover. This not only reduces fuel consumption but also contributes to a notable decrease in CO2 emissions.

These compact and technology-driven hubs are positioned in densely populated areas, revolutionizing the processing, preparation, and swift dispatch of goods to eager customers.

By placing these micro-fulfillment centers closer to urban consumers, retailers can significantly diminish delivery distances and travel times, resulting in a faster and more sustainable last-mile delivery process.

Charles Haverfield is CEO of US Packaging & Wrapping.

This article originally appeared in the March/April, 2024 issue of PARCEL.