Sometimes the last mile can be 1,300 miles. Everyone on project44‘s inaugural episode of Supply Chain LIVE — The State of Last Mile Delivery: Data Insights, Innovation and Business Trends — unanimously agreed that unprecedented growth in E-Commerce penetration has led shippers to rethink their supply chain strategy.
“Walking into the pandemic, we were facing the challenges everyone else had, and we realized the last mile wasn’t a mile at all; it was 1,300 miles,” said Bill Besselman, SVP of Supply Chain Execution at American Eagle Outfitters and a featured panelist on the webinar.
Hosted by Bart De Muynck, newly appointed CIO of project44 — the leading supply chain visibility platform — the webinar began by painting a picture of how the supply chain became so stretched during the pandemic. Then co-host Jenny Bebout, VP of Product at project44 and Founder of Convey, started to dig into the numbers.
One critical data point was that Net Promoter Score (NPS) and customer satisfaction surveys (CSATs) are increasingly having a greater impact on revenues.
“The customer experience needs to be dynamic, informative and branded. Our customers need flexible ways to communicate with consumers — we’re talking smart experiences tailored to each individual: maybe adding a link to a summer playlist or a TikTok video to their brand.”
Jenny Bebout, Global Leader of Last Mile Solutions, project44
For many retailers, the two biggest barriers to going the distance in last mile delivery fulfillment continues to be delivery speed and cost. Reducing costs without sacrificing on-time delivery is every retailer’s greatest challenge.
“The number-one way to reduce your last mile costs is to put the product closer to the customer. You go from a Zone 8 average, because it’s 1,300 miles, to a Zone 2 or 3 by putting it in the market but not in the store.”
Bill Besselman, SVP of Supply Chain Execution, American Eagle Outfitters
Other data insights shared included metrics on last mile fulfillment and transit times, last mile carrier diversification trends, last mile on-time performance and last mile shipment exception trends.
To help combat increased last mile costs stemming from increased base rates, increased surcharges, fuel surcharges, peak surcharges, and impact to service and capacity guarantees, p44 suggested three strategic areas every shipper should be focused on:
1. Carrier Diversification: Multi-carrier strategies to increase costs and speed, and to reduce capacity risks we’re seeing in carrier networks.
2. Inventory Optimization: Reducing inventory costs and increasing delivery speed, especially for consumers that want products same-day or next-day.
3. Supply Chain Partner Collaboration: Shippers, carriers, 3PLs and tech partners are now working together, with a focus on flexibility and willingness to innovate.
That last point on collaboration among companies proved to be the webinar’s hottest topic.
“A lot of brands build product in the same factories. We’re buying zippers from the same place. We’re riding on the same boat. We’re already riding on the same FedEx truck. We literally share everything from factory to store. In a world where the Walmarts and Amazons have such incredible scale, small and mid-sized brands will get left behind if we can’t figure out how to collaborate and work together.”
Bill Besselman, SVP of Supply Chain Execution, American Eagle Outfitters
Bebout was quick to point out that internal collaboration is also crucial — for example, ensuring that Customer Care is talking to the supply chain side as well as marketing, etc.
Besselman replied with a resounding yes. “Because of the elongation of the supply chain, even building the internal muscle that better links your supply chain into your brand is something that’s a must-do as supply chain takes a bigger role in the customer-facing world,” he said.
The panelists also discussed the importance of:
- Consumer Predictive Delivery Date Estimates
- Dynamic and Delightful Consumer Communication
- Proactive Exception Management
Muynck then brought on another featured panelist, OneRail Founder & CEO Bill Catania, who emphasized the importance of redundancy — having a stack of carriers at a given moment who could take a delivery — and being able to rank-stack those carriers and optimize them in order of quality and cost to yield much better outcomes when it comes to exceptions management.
“Our platform is prioritizing carriers who are on time, so it’s giving favor to carriers who are on time at a market level, and at a specific contract level. Therefore, we’re taking a preventive approach to exceptions. That’s made a huge difference for our customers.”
Bill Catania, Founder & CEO, OneRail
Like the other panelists, De Munyck reiterated the importance of customer experience.
“Customer experience management is vital. The customer experience is really the key measurement in last mile. To borrow from the famous quote of necessity being the mother of invention, digital disruption has been the mother of digital transformation.”
Bart De Muynck, Chief Industry Officer, project44
Catania agreed with the panel that carrier diversification is everything. Among the 9 million-plus drivers OneRail has aggregated in its carrier network, he’s seeing more diversity, not only in the carriers but in the delivery drivers and the accessorial services they offer.
“Our platform also makes decisions on whether to put a delivery on own fleet or external fleet. Some of our customers are in the 30 percent range in terms of utilization, and we’re trying to help them move that number up significantly by optimizing their fleet.”
Bill Catania, Founder & CEO, OneRail
Bebout couldn’t agree more.
“It’s not just the number of carriers — it’s parcel, it’s courier, it’s LTL, it’s white glove delivery, it’s the gig economy. It’s all of those things.”
Jenny Bebout, Global Leader of Last Mile Solutions, project44
Throughout his career, De Munyck has seen companies having one TMS for their first mile, a different system for their middle mile, and then perhaps two or three different systems for the last mile — depending if it’s private fleet or parcel or everything else.
“You don’t always get that full end-to-end view from one platform, and all those moving parts aren’t always necessarily aligned.”
Bart De Muynck, Chief Industry Officer, project44
From commenting on the latest data to exchanging innovative ideas, this debut episode made it clear that these are some of the brightest minds in supply chain today. Catania is fresh off being named a Fresh Face for the Orlando Inno Fire Awards, for his innovation and forward-thinking — something he values in last mile solutions as well.
“Being able to innovate with last mile technology, and have fluidity between modes is also very important. To be able to move from parcel to courier, or from LTL to courier, by utilizing zone skipping and by executing merchant transit — it’s all about fluidity, flexibility and depth.”
Bill Catania, Founder & CEO, OneRail
