As we know,logistics is always close to delivery, storage, transportation, and activities related to the movement of goods. However, did you know that this process is actually much more difficult than you imagine? If you dive deeper, you will come across terms such as first-mile and last-mile logistics which are part of supply chain milestones.
So, basically, these two goods delivery strategies explain how goods are sent from the production location to the hands of consumers.
As the name suggests, first-mile logistics refers to the initial delivery of goods, a.k.a first-mile delivery. In this stage, goods or products are taken from the factory to be sent to the warehouse and distribution center. This stage often involves transportation and assembly of goods, especially for non-raw material products.
Interestingly, the use of this term is different in each industry because the process and stages required for transferring goods will be different. For example, for the retail industry, first-mile logistics is the process of transporting products from factories or production sites to distribution centers owned by third parties. The aim is that in the next stage, the product can be passed on to the final consumer by the courier on duty.
Meanwhile, for some industries that manage their own production of goods, the first stage of the delivery process can be from the production area, straight away to the shop. That way, consumers will be able to visit directly to enjoy these products.
Now we jump to last-mile logistics, which is the final stage in a series of goods delivery processes. This stage refers to the transportation of goods from a warehouse, distribution center, or store to the final destination.
Similar to first-mile logistics, the term last-mile can also be interpreted differently by each industry. If you focus, we even mentioned examples of shipping origin locations that are contextually very different.
If an industry provides goods to retailers, last-mile logistics may start from the warehouse to the distribution center and retail stores. However, this can also be used to refer to the process of sending goods from the distribution location to the consumer’s home.
One thing that we all agreed upon is that this final stage of delivery becomes the most expensive journey because the process can be repeated for more than one final destination. The shipping costs set per trip will depend on several factors: weight and volume of goods, type of delivery package, courier service used, and don’t forget additional policies for special conditions.
Difference between First-Mile Logistics and Last-Mile Logistics
It’s actually a bit strange to put the above two delivery processes in this kind of comparison situation. However, both the first-mile and last-mile logistics are part of one broken chain. Both are different stages of a cycle.
Given that the world of logistics can be complex and intricate, we’ve created a clear and informative table for you to easily understand the distinctions between first-mile logistics and last-mile logistics.
|First-Mile Delivery||Last-Mile Delivery|
|This is the initial stage in the supply chain milestone.||This is the final stage in the supply chain milestone.|
|Refers to the delivery of goods from the production location (factory) to the next location (warehouse, distribution center, etc.)||Refers to the delivery of goods from the distribution center/warehouse to the final location (retail store, consumer’s home, etc.)|
|Goods are sent in large quantities for one or two trips.||Goods are shipped in lower volumes, but the frequency rate has increased drastically.|
|Goods will be packed in large, labeled packages.||Items will be separated for each type and variant. Then, each variant has a specific SKU.|
Apart from the details mentioned above, the keywords for you to remember in this comparison are just the terms themselves: first and last. That alone should be enough for you to understand and be able to continue the next discussion, which is very interesting.
Middle-Mile Logistics: Between the First-Mile and the Last-Mile
One interesting thing when diving into these two logistics terms is that you will find another one that lies between them: middle-mile logistics. What’s that?
Middle-mile logistics is the process of moving goods from the warehouse to the retailer or end consumer. In order, this can be said to be the second stage in the logistics process, right after first-mile logistics and before last-mile logistics.
Being in the middle, this strategy more or less has a combination of concepts between the two strategies that we have compared above. In this concept, generally, you will be dealing with transportation of large quantities over longer distances. This is done on a large scale so as to reduce costs and increase efficiency. The middle-mile logistics strategy is very suitable for adoption by giant retail companies that have a very wide reach.
So, this explains your understanding that in supply chain management, there are not only two methods of transporting goods. You always have other options that can be tailored to your supply distribution needs.
The Right Time UsingFirst-Mile Logistics
As the initial stage of the logistics process, it is important for you to ensure that goods arrive at their destination safely when using first-mile logistics. But, when exactly should you use this method?
- If you are a manufacturing company that needs to send finished products from factories to distribution centers.
- If you are a retail company that needs to send goods from suppliers to your warehouse.
- If you are an e-commerce company that ships goods from your warehouse to end consumers.
Apart from that, don’t forget to also consider supporting factors such as cost, choice of transportation mode, distance and estimated travel time, and delivery volume.
The Right Time Using Last-Mile Logistics
At the final stage of the logistics process, you need to ensure the goods arrive on time when using the last-mile method. Apart from that, the condition of the goods should not be underestimated, because it concerns the final consumer. So, this is the right time to use last-mile logistics:
- When you are an e-commerce company that delivers goods to end consumers.
- When you are a retail company that ships goods from your warehouse to your stores.
- When you are a manufacturing company shipping goods from your distribution center to your customers.
Just like first-mile logistics, with the last-mile method you also have to consider distance, volume of goods and costs carefully.
Now you know the difference between first-mile logistics and last-mile logistics. Next, it is your job to determine which method is most appropriate for your company. However, whatever the method, the quality of the logistics service you choose is the most important..