One of the most difficult and expensive aspects of the supply chain is last mile delivery. However, from a customer experience standpoint, it is also the most memorable and possibly important. Last mile delivery has become an increasingly hot topic, as companies look at ways to optimize final mile deliveries.
There are a variety of ways that companies can manage their transportation spend. The three traditional methods are the use of a transportation management system (TMS), transportation execution system (TES), and managed transportation services (MTS). Ultimately it comes down to whether shippers want to manage their freight spend in-house or outsource it. The most common application for in-house management is a TMS. A TMS offers optimization capabilities across multiple modes to improve service levels and reduce freight spend. The alternatives to TMS include transportation execution solutions and managed transportation. Transportation execution solutions are mode specific and lack optimization capabilities, but for shippers with simpler transportation requirements, that is often all they need.
Large shippers with complex needs may turn to managed transportation services providers to plan and execute their loads. These MTS providers may use an in-house developed TMS. Or, if they use an off-the-shelf TMS, they may get a volume discount. In some instances, they may not use a TMS at all in managed trans deals, although these providers lack a significant presence in the market. Depending on the complexity of operations, and how the company is using its technology, last mile delivery can be an integral part of the overall transportation journey.
