The idea behind last mile logistics is that it 'reduces freight traffic in a target area by consolidating cargo at a terminal or consolidation center.
The idea is that carriers that might otherwise make separate trips to the target area with relatively low load factors, would instead transfer their loads to a (neutral) carrier that consolidates the cargo and conducts the last leg of the deliveries'
Consolidation Centers
There are different varieties of consolidation center. The most common types are listed below. While the societal benefits are undeniable, it is however often difficult to attract sufficient users because of cost constraints.
Urban consolidation centers (UCCs) are the conventional form of consolidation center and correspond to the definition provided above. The consolidation center is situated outside the city or urban area, and from there a neutral carrier conducts the last leg of the deliveries. The initial carrier delivers the goods to the consolidation center and pays a fee for the last mile.
The principle is illustrated in Figure 1 where a construction site is the destination. Without a consolidation center.
Different providers send goods separately to a destination in an urban area (upper part of Figure 2.7). With a consolidation center, all providers send goods to the consolidation center outside the city. From there only one regular delivery takes place at regular times (lower part of Figure 5.6). The transport burden in the urban area is in that way significantly reduced.
The principle of these centers is exactly the same as that of centers outside the urban area. These are often smaller and can even be very small. Parcel lockers or proximity delivery points are examples of very small consolidation centers that make it unnecessary for the courier to make final deliveries. This means that the courier can significantly rationalize the trip. The recipient can/has to pick up their parcel at these locations. Shops where clients go to pick up their parcels are examples of delivery points. These are a type of micro-consolidation center.
Consolidation linked to a modal shift terminal, a modal shift terminal in or close to the city will nearly always imply an FIRST/LAST option. If goods are shifted from road to ship or train, to arrive in or close to the city, these goods will most probably be unloaded in a consolidation center, from where a last mile mode will take the goods to the receiver. Although appealing to many, such initiatives face major obstacles in urban areas. These consolidation centers may be inside or outside the urban area, depending on the situation of the railway (or inland waterway) terminal. Consolidation centers can work in different modalities. Some of those provide incentives for using them. This contributes to their success.
Delivery drones
Drones with automated navigation systems can be used to deliver small parcels directly to the consumer. Retailers and logistics companies are currently trailing the commercial use of such delivery drones. Delivery by drone could prove faster and more efficient than ground delivery. It could also be more environmentally friendly if congestion and emissions are avoided. The challenges of making drones competitive for parcel delivery are, however, important. The societal benefits, for example in reducing traffic congestion, of drones can therefore be expected to be marginal in the near-term. The European drones outlook study (SESAR Joint Undertaking, 2016) estimates that drones would be able to make approximately 1 % of total parcel deliveries today. This estimate takes into account aspects of costs, weight and distance.
Drones will be most useful for more expensive same-day deliveries, urgent deliveries (e.g. in the medical sector), and where the parcel's weight does not exceed 2.5 kg and the delivery distance is short.
Delivery robots or droids
These are small autonomous vehicles that deliver parcels. Some tests are being undertaken (Espinoza, 2018). Further challenges remain, however. Delivery robots are much more conspicuous than drones, which implies a higher risk of interaction with the public and of more conflict with other pavement users, which could threaten public acceptance. San Francisco passed a law in 2017 to limit the use of delivery robots (Brinklow, 2019). It should be noted that the productive use of delivery robots requires inventory dispersal and local dispatch, as is the case for drones.
Summary
The Inland depots aren’t important for only Empty Container Repositioning (ECR), but also necessary to enable last mile services by providing urban consolidation services and try cover the cost of the extra trans-shipment.