The recent volatility in supply chains around the world has prompted a great deal of thinking about how to improve logistics at every stage. Naturally, this presents complex challenges. Supply chains have many moving parts, and because of this many businesses and customers can find the whole process confusing.
To bring down costs, shippers often pay attention to the ‘last-mile’, i.e. the final stage of delivery, and may neglect the ‘middle-mile’ as a result. In this article, we’ll explain how the ‘middle-mile’ works, why it’s important to the logistics process, and what shippers can do to optimise this segment of their freight journeys.
To bring down costs, shippers often pay attention to the ‘last-mile’, i.e. the final stage of delivery, and may neglect the ‘middle-mile’ as a result. In this article, we’ll explain how the ‘middle-mile’ works, why it’s important to the logistics process, and what shippers can do to optimise this segment of their freight journeys.
What is middle-mile logistics?
Shipment journeys may be long and have multiple destinations along the way. During the middle mile, goods are transported between two facilities, as follows: a supplier or production centre moves the products to a warehouse for temporary storage.
The middle-mile delivery is a unique segment in the logistics process, and a crucial phase that is sensitive to items that have already moved on from the production centre but aren’t quite ready to head to the customer. Until that point, the goods sit in a warehouse or other sorting/storage facility.
What makes middle-mile logistics so important is that bottlenecks can happen during this stage, causing customers to get late deliveries. Improving middle-mile delivery and operations boost efficiency as it helps consolidate shipments en route to their final destination—preventing delays and keeping customers satisfied.
The middle-mile delivery is a unique segment in the logistics process, and a crucial phase that is sensitive to items that have already moved on from the production centre but aren’t quite ready to head to the customer. Until that point, the goods sit in a warehouse or other sorting/storage facility.
What makes middle-mile logistics so important is that bottlenecks can happen during this stage, causing customers to get late deliveries. Improving middle-mile delivery and operations boost efficiency as it helps consolidate shipments en route to their final destination—preventing delays and keeping customers satisfied.
First-mile vs. middle-mile logistics
The supply chain has three key segments: first, middle and last-mile. The first mile is when a carrier or logistics operator moves goods from the supplier or manufacturer’s facilities to a fulfilment centre or warehouse. Once delivered, the first mile ends and the middle mile begins.
When businesses want their middle-mile to be taken care of by Amazon Freight (Fulfilled By Amazon) they can have their goods delivered to an Amazon FC, where it is then shipped to the customer by a HGV or via intermodal transport such as by sea or railway. Amazon intermodal rail, for example, allows shippers to reduce carbon emissions by up to 56% vs road equivalent transport.
When businesses want their middle-mile to be taken care of by Amazon Freight (Fulfilled By Amazon) they can have their goods delivered to an Amazon FC, where it is then shipped to the customer by a HGV or via intermodal transport such as by sea or railway. Amazon intermodal rail, for example, allows shippers to reduce carbon emissions by up to 56% vs road equivalent transport.
Middle-mile versus last-mile delivery
The important difference between middle-mile and last-mile logistics is where products are shipped. Middle-mile exclusively concerns goods transported between warehouses and distribution centres, and last-mile covers the shipments moving from logistics centres to customers.
With the rise of e-commerce, although there has been growing discussion about middle-mile delivery, in general more attention is paid to the final leg—the ‘last mile’—as this is typically the most expensive and complex stage of logistics. Yet, if optimised and managed well, the middle mile is an area for significant cost reductions.
With the rise of e-commerce, although there has been growing discussion about middle-mile delivery, in general more attention is paid to the final leg—the ‘last mile’—as this is typically the most expensive and complex stage of logistics. Yet, if optimised and managed well, the middle mile is an area for significant cost reductions.
The importance of middle-mile delivery
Innovating supply chains and logistics has been an important strategy for many businesses trying to gain a competitive edge over their competition. The main reason why most discussions around improving efficiency involve the last-mile is because it is expensive, accounting for at least half of total shipping costs—and time-consuming. Any further inefficiencies throughout this stage only add more complexity and cost to logistics.
Shippers are therefore wise to focus on making the last-mile as smooth as possible—but that does not mean they can forget about optimising the middle-mile process. Business owners who make significant improvements to this segment will boost efficiency throughout the supply chain, cut costs and create more flexibility and adaptability in the face of supply chain shocks.
Doing so sooner rather than later will also position them ahead of the majority of shippers. But before they can improve, they first need to know the key vulnerabilities of middle-mile logistics.
Shippers are therefore wise to focus on making the last-mile as smooth as possible—but that does not mean they can forget about optimising the middle-mile process. Business owners who make significant improvements to this segment will boost efficiency throughout the supply chain, cut costs and create more flexibility and adaptability in the face of supply chain shocks.
Doing so sooner rather than later will also position them ahead of the majority of shippers. But before they can improve, they first need to know the key vulnerabilities of middle-mile logistics.
The key challenges of middle-mile delivery for freight
Supply chains are growing more complex and have seen a great deal of disruption in recent years. However, customer demand remains strong. The rise of globalisation has meant more logistics companies outsourcing transport and shipping smaller packages more frequently.
All of this means that there is a growing need for fast fulfilment, accuracy and efficiency when the cost of shipping is rising. Here are the key pain points for the middle-mile phase in particular:
All of this means that there is a growing need for fast fulfilment, accuracy and efficiency when the cost of shipping is rising. Here are the key pain points for the middle-mile phase in particular:
Routes
A key element of gaining control over the middle-mile of logistics is making sure that shipping routes are as efficient as possible. Supply chains have become more fragmented, which means that more sophisticated solutions are needed to make real-time decision making to optimise shipping routes effectively.
Technology
Many shipping companies and logistics providers still use legacy systems and the same routes they have done for decades. This creates friction in a fragmenting global supply chain. However, there is a great deal of new and emerging technology that can modernise companies’ middle-mile.
Visibility
Middle-mile logistics involves warehouses. Although these facilities are invaluable for secure and efficient delivery they also present problems and cause delays when storage locations are hard to find. Poor warehouse visibility makes it more challenging for shippers to coordinate fulfilment and transport with carriers.
How to improve middle-mile logistics
1. Warehouse management systems
Visibility is key to effective warehousing. Having as much information as possible about where the goods are located and where best to store them is key to a proper warehouse management system (WMS).
These software systems allow warehouse managers additional control over the location of inventory, stock levels and the method of retrieval. That way they know the best time to replenish goods, the ideal point to sell particular products, and how to reduce inventory when the time comes.
These software systems allow warehouse managers additional control over the location of inventory, stock levels and the method of retrieval. That way they know the best time to replenish goods, the ideal point to sell particular products, and how to reduce inventory when the time comes.
2. Route Optimisation
There are a number of tools shippers can use to gain visibility into how to improve routes for smoother transportation. Software solutions allow shippers to plan the sequence of pickups from suppliers, manufacturers or distribution centres to their warehouse. They also let shippers see where routes can be made more efficient and therefore fit in more deliveries to their facilities.
3. Leverage Data
Capturing data from across your supply chain will help you understand where the real costs and inefficiencies are, and provide opportunities for improvement. Data insights from the journey between manufacturers’ centres and warehouses will help shippers monitor any frequent problems in real-time, make the necessary adjustments and improve ROI as a result.
Get hassle-free logistics with Amazon Freight
Shipping freight with us gives you a range of options that make the transport process smooth and efficient for your business. Our tech capabilities are constantly enhanced, helping our customers optimise logistics and improve their reliability. We provide an extensive network of carrier vehicles and logistics partners, plus GPS-tracked trailers for visibility.
To find out more about how we can support your business, contact us today at freight-uk-interest@amazon.com or create your free shipping account to get an instant quote.
To find out more about how we can support your business, contact us today at freight-uk-interest@amazon.com or create your free shipping account to get an instant quote.
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