Most people in the logistics sector know the term last mile, i.e. the shortest part of the supply chain that makes out the final destination and the most expensive part of the journey due to the time and effort it takes to coordinate it.
With increasing customer demands, especially in B2C, the last yard adds another level of complexity and cost for carriers. If the last mile is commonly known within logistics, the last yard might not be as established. The term was only introduced in 2019 by a Penn State supply chain professor and adds another stop on the logistics itinerary. If last mile is the final route before a shipment reaches a business or a consumer, the last yard takes it to where the business or consumer will use it.
For manufacturing companies last yard actually means getting the goods delivered directly to a specific spot on the production line.
But will this ever become an investment worth making for manufacturing companies? Maybe. Assume the line has to be shut down because a particular part is lacking. Normally, carriers would get a request to deliver an expedited order to the site goods reception. The shipment is delivered on time, i.e. the last mile was properly covered, but for some reason it ends up sitting in a goods reception for a few days more. The delay is on the customer’s side, but the carrier might still get some badwill from it. What would happen if the missing part instead was brought to the production line by the carrier?
We don’t necessarily think that the last yard is an investment alternative on the table for all manufacturing companies. Companies that for instance rely heavily on chemicals, e.g. paper and pulp manufacturers that we at Lup Technologies have a strong collaboration with in Sweden, are likely reluctant to outsource the last yard given the additional security and compliance required when managing chemical goods. On the other hand, for e.g. automotive players and especially OEMs, the concept might be more intriguing assuming that the additional data required to guide a carrier into the production facility and the security accesses can be solved in a safe, simple and compliant way.
At Lup Technologies, we believe that extending the yard into the production plant might be feasible and we will continue to look at ways to develop our solution once the requirement potentially hits us.
What are your thoughts? Do you think that last yard will become the new last mile?