The "Last Mile" in Inland Freight Distribution
Freight distribution can be
represented as a flow chain supported by a transport chain.
The flow chain is illustrative of the frequency and unit volume
of each segment, from maritime shipping (high volume, low
frequency) to local deliveries (low volume, high frequency). Long distance transportation tends to be well serviced
by high capacity modes and terminals and is prone to economies of scale
(massification). The global shipping network offers very high
volumes per unit and, depending on the routes, a reasonable
frequency of services (for instance, one port call every two
days). As we get closer to the final customer, economies of
scale are increasingly difficult to apply as the size of batches
tends to diminish (atomization). It would be rare, for instance,
for a single customer to be the consignee of the cargo of a
The "Last Mile", notably for retailing, often consists of truck
deliveries taking place over short distances, but likely in a
congested urban setting and in less than full truck load (LTL). It
is often one of the most complex element of the commodity chain to
organize as it reconciles many customers, a variety of shipments and
reliability difficulties related to congestion. The "Last Mile"
concept also applies to the "First Mile", albeit in reverse, which
involves consolidation to a nearby transport terminal of the output
of potentially several producers. For inland freight distribution
there are two types of last mile logistics:
The containerization process is thus confronted with a growing tension
between a massification at sea and an atomization on land. Growing vessel
size has led to the massification of unit cargo at sea. On terminals
and at the landside, massification makes place for an atomization process
whereby each individual container has to find its way to its final destination.
A major challenge consists in extending the massification concept as
far inland as possible. Postponing the atomization of flows
shifts the container sorting function to the inland and as such eases
the pressure on port terminals. High-volume rail and barge corridors
including inland terminals play a crucial role in this process.
- Gateway-based where the cargo is either
bound to a local (or regional if long distance trucking is
involved) consignee or transloaded into a domestic container and
brought back to an intermodal terminal for inland shipping.
Since gateways are generally large urban areas, these operations
are commonly involving congestion. There is also a large gap
between the capacity of the maritime segment and the drayage
segment, which commonly involves delays at terminal gates.
- Hinterland-based, which links gateways to inland terminals often using
rail or barge services, is of lower volume but of higher frequency.
Once freight consignments arrive at an inland terminal they are collected
and brought to distribution centers through drayage by truck.