The last mile describes the short geographical segment of delivery of communication and media services or the delivery of products to customers located in dense areas. Last mile logistics tend to be complex and costly to providers of goods and services delivering to these areas.
Key Takeaways
- The last mile refers to the short geographical distance that must be spanned to provide services to end-user customers.
- Last mile logistics tend to be complex and costly to providers of goods and services delivering to these areas.
- In communications, the last mile is the relatively expensive and complex delivery of cables or wiring from the provider’s trunk to one’s home.
- Last mile logistics have become a big business and a central focus for both service providers and consumers.
- Last mile logistics for product delivery have become a central focus for retailers in the e-commerce era.
Understanding the Last Mile
Delivery by telecommunications and media companies is virtually instantaneous for information, and miraculously swift for physical goods up to the edges of densely packed areas. Imagine a trunk line leading to the edge of a city or metropolitan area.
From there, the network’s branches and leaves spread out across the tightly packed buildings and streets to serve customers living and working there. This final stretch from the city’s edge to the customer inside is the last mile.
Communications and media providers - including cable, satellite, and wireless companies - invest heavily to upgrade old systems and build new networks to ensure customers have adequate bandwidth for data and streaming services on their devices.
These service providers face a “last mile problem.” Due to the rapidly changing nature of technology, solutions may be at risk of being obsolete upon completion.
Last Mile Logistics
Today’s e-commerce-driven society demands quick delivery for online purchases. Retailers maximizing this and providing free or low-cost delivery harness significant competitive advantages.
Amazon utilizes third-party services and its own fleet to achieve final-mile delivery excellence. Competitors invest similarly in establishing distribution centers close to metros and partnering with UPS, USPS, FedEx, and local couriers.
In urban hubs, deliveries can cause congestion and safety problems, heightening the difficulty of last mile execution.
The Last Mile Problem and Cryptocurrencies
Cryptocurrency has introduced another dimension. When a cryptocurrency like Bitcoin is used for cross-border payments (e.g., remittances), the recipient must then convert the Bitcoin to local currency - another last mile hurdle especially potent in less-developed countries.
What Does Last Mile Mean?
Higher efficiency and cost-effective last-mile processes are the driving goals of endeavors whether in transportation, logistics, manufacturing, or retail. It represents the final stage of a customer’s journey or a product’s transportation process.
Why Is There a Last Mile Problem?
The last mile in supply chain management describes the complex and costly final stretch in delivering packages from hubs to final destinations. Challenges include costs, transparency, efficiency, and infrastructure.
It’s notoriously tough due to the specific requirements and costs associated with getting a product from the last distribution center to the final customer.
What Is the Last Mile in Terms of Internet Service?
In internet industries, the last mile specifically means the final leg connecting telecommunications networks and customers. It’s the network reach physically tethering to the customer’s premises.
Are the First Mile and the Last Mile Problems the Same?
The first mile problem often refers to public transit systems: identifying transportation from the origin point to the transit system, akin to reducing both first and last mile issues in supply chains.
The Bottom Line
The last mile epitomizes the final step in delivering media communications or physical products to a consumer. This segment demands high costs and rigorous planning for timely, efficient service.
Related Terms: competitive advantage, distribution centers, broadband, remittance, cryptocurrency, first mile problem.
References
- University of Michigan. “Potential Solutions to the First Mile/Last Mile Problem”.
