Last mile and fulfillment are two essential components of the supply chain and logistics process, especially in the e-commerce industry. While the two terms are commonly used in similar contexts, they’re not exactly the same. In this article, we’ll review the two terms and discuss the important differences between last mile and fulfillment.
In this article:
- What is Fulfillment?
- What is Last Mile?
- The Key Differences Between Last Mile and Fulfillment
- Final Thoughts
- Frequently Asked Questions
What is Fulfillment?
Fulfillment, also called order fulfillment, describes the full process of receiving an order and processing it, preparing it for shipment, and delivering the order to the customer. Warehousing and storing products prior to receiving orders, notifying customers when an order is shipped, and processing payments are also often considered part of the fulfillment process.
What is Last Mile?
Last-mile delivery, also known as last-mile logistics and final-mile delivery, is the final leg in the supply chain—the last leg of a product’s journey. In last-mile delivery, a product is transported from a hub, warehouse, or distribution center to the customer’s delivery address.
Importantly, last-mile delivery does not encompass the transport or storage of goods that occur earlier in the logistics process, such as transportation from a manufacturer to a distribution center. Last mile refers only to the final step in the process, from the moment a product is picked up from a local distribution center and loaded onto a delivery vehicle through the delivery of the package to the customer.
The Key Differences Between Last Mile and Fulfillment
Let’s take a look at the most significant differences between last mile and fulfillment.
The biggest difference between last mile and fulfillment is scope. Fulfillment refers to the complete process of receiving and processing an order, preparing the order, and transporting it to its next destination, while last mile is specifically the last step in the product’s journey.
Thus, fulfillment has a much broader scope than last mile.
Another significant difference is the facilities used. In order fulfillment, a fulfillment center—a large warehouse facility—is the primary facility used. These facilities are used to store inventory, pick orders, and package items for shipping. In last-mile, local hubs or delivery centers are more commonly used. These facilities are used for sorting and dispatch.
While last mile and fulfillment share some processes, there are a few processes involved in fulfillment that don’t occur in the last mile, such as:
- Inventory management: Part of the order fulfillment process is managing inventory and ensuring that enough products are in stock to meet customer demand. This includes maintaining accurate inventory counts.
- Order processing: Order processing is a crucial step in the order fulfillment process. It involves handling customer orders efficiently from the moment they’re received until they’re prepared for shipment and loaded onto a truck or other transport vehicle. Last-mile delivery does not involve order processing, as the orders are already processed and have been shipped from the originating warehouse before arriving at a local distribution center.
- Packing and shipping: Order fulfillment also requires picking products from warehouse shelves and storage areas, packing them appropriately for safe transport, and loading packages onto vehicles for transport. In last-mile delivery, products are already picked and packaged.
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The primary processes involved in last-mile delivery include:
- Sorting, dispatch & routing: This includes sorting parcels, dispatching, and planning delivery routes.
- Order updates: It’s imperative to keep customers updated on the status of their package throughout the last-mile delivery process.
- Delivery: Delivering the order to the customer’s location in a timely manner and in good condition marks the end of the last-mile delivery process.
Both fulfillment and last-mile delivery are complex processes. However, the last mile is widely regarded as the most complex and costly leg of the delivery process due to factors such as traffic congestion, inaccurate addresses, and customer availability.
Last mile and fulfillment are both crucial parts of the overall supply chain and logistics process. Last-mile delivery is just one component of the fulfillment process, focusing on moving a parcel from a local distribution hub to the customer’s delivery address.
Last-mile delivery is the most expensive segment of the product’s journey, but optimizing this leg of the supply chain offers significant benefits.
The Wise Systems delivery automation platform is a suite of solutions designed for every stage, from routing and dispatch to customer communication and performance management. Book a demo today to discover how Wise Systems can help you optimize your last-mile delivery processes.
Frequently Asked Questions
What is the meaning of fulfillment?
Fulfillment refers to the series of processes involved in completing an order, such as receiving, processing, packing, and shipping products to customers. It ensures that customers receive their orders accurately and promptly.
What comes before last-mile delivery?
Before last-mile delivery, orders go through processes like picking and packing at a fulfillment center, followed by transportation to a local hub or distribution center (which includes first-mile and middle-mile delivery). These steps ensure that the products are ready and properly sorted for the final delivery to the customer.
Why is the last mile important in logistics?
The last mile is important in logistics because it significantly impacts customer satisfaction and overall delivery efficiency. It’s the final touchpoint in the supply chain where goods reach the customers. As such, errors or delays at this stage can adversely affect the customer experience and the company’s reputation.
What is the difference between logistics and fulfillment?
Logistics is a broader term encompassing the overall management of how resources are acquired, stored, and transported to their final destination. Fulfillment, on the other hand, is a subset of logistics focusing specifically on completing customer orders, including storing, picking, packing, and shipping goods.
What are the benefits of last-mile optimization?
Last-mile optimization benefits include cost-efficiency, improved delivery speeds, enhanced customer satisfaction, and sustainability. It involves streamlining operations, such as route planning and customer communications, to make the last leg of the delivery process as efficient and customer-friendly as possible.