Last Mile Delivery is the final stage in getting a product to the customer. It's the last leg of the journey and it's often the most important, as it's the point when the customer finally gets their hands on what they've ordered. Last Mile Delivery is particularly important for e-commerce companies, as they rely on speedy delivery to get their products to customers as quickly as possible.
The delivery agents are responsible and are essential to the process. Without efficient and reliable last mile delivery, e-commerce companies would struggle to meet customer demands for speedy delivery.
There are an estimated 2.5 million Last Mile Delivery workers worldwide.
There are a number of reasons why people might work as Last Mile Delivery workers. Some may see it as a way to make some extra money, others may enjoy the challenge of working in a fast-paced environment, and others may appreciate the opportunity to be their own boss.
Having happy delivery executives are essential to the success of last mile delivery. In order to keep your Last Mile Delivery workers happy, you need to provide them with adequate incentives.
Incentives are successful in increasing output because they provide Last Mile Delivery workers with an added incentive to work harder and more efficiently. When workers are given a monetary incentive, they are more likely to work harder in order to earn more money. In addition, when workers are given an incentive that is specific to their job, they are more likely to be motivated to work harder in order to meet the expectations of their employer.
Planning your incentives is key to the success of your last mile delivery operation. It needs to make sure that your most hard-working delivery workers are paid well and also to make sure that it stays within the budget. It is important to analyse your metrics before you plan an incentive. Some key metrics to analyse would be:
All the above metrics need to be accounted for when planning an incentive because the motive of an incentive is to make sure the output increases as the delivery workers see this as an opportunity to earn more when they do more deliveries but also you need to keep a check on the Quality of the service provided, there are chances that the workers might compromise on the quality intentionally or unintentionally as they rush towards doing more deliveries to earn more.
There are several ways you can plan your incentives based on how your delivery team is performing. Every delivery team is different, you might see a Pareto of workers who worked very hard when compared to the others and there might be teams where you don't see a big standard deviation from the average deliveries done per person. How do we tackle both cases?
In conclusion, a healthy incentive is key to make any delivery operation a sustainable one. Since it is a manpower heavy operation you need to keep into account the happiness and job satisfaction of your workers. In addition to just monetary rewards, you could also provide paid vacation days, gift vouchers for best performers.
Here is a Excel calculator we designed to help you understand how your cost per delivery gets affected by other metrics :
Learn how Zorp can help automate workflows and build simple to complex business applications 10X faster without coding.