Last time we talked about distribution network designs and six ways to deliver. One of these options is Distributor Storage with last-mile delivery and I found a quite interesting article about the impact of last mile delivery.
The last-mile delivery as the “last leg of the supply chain” in which consumer products are delivered to the home is a crucial part of Masco’s (kitchen cabinet manufacturer, Michigan, U.S.) supply chain: “Our delivery network is part of our value proposition to customers and their consumers”.
Masco even received a first-place rating from JD Power for its delivery model and service standards. But why is Masco so successful?
- Outsourcing last-mile delivery through partnership with two big logistics providers that specialize in last-mile delivery: 3PD and Cardinal Logistics –> breadth and depth of delivery options, physical assets, and cost efficiencies
- Transactional-style business relationship –> providers adjust to Masco’s volume, constant price per unit
- No necessity to maneuver a 28-foot trailer along residential streets
- No special caring about the customer’s home (e.g. to destroy the customer’s carpet in his house when delivering kitchen stuff)
- Order-tracking possibility for customers –> new for heavy goods, last-mile was a black hole
- Investments in technology that automates communication among the various parties involved in the last mile
- Offering a three-hour window the night before delivery and a phone call 30 minutes before arriving at a consumer’s house (–> customer service)
- About 12 minutes after delivery, customer receives an automated call to ask whether service parameters met customer’s expectations –> every-day measure of customer satisfaction
“Any supply chain is only as strong as its weakest link,” notes Streamlite’s Rover. “A company can move a product from China to the United States, clear it through Customs, move it to a distribution center, and fulfill it in record time. But if it doesn’t deliver the product to consumers quickly enough, they are not happy, and the company’s supply chain has failed.”