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Concept
Last mile (transportation)
Summary
In supply chain management and transportation planning, the last mile or last kilometer is the last leg of a journey comprising the movement of people and goods from a transportation hub to a final destination. "Last mile" was adopted from the telecommunications industry which faced difficulty connecting individual homes to the main telecommunications network. Similarly, in supply chain management last-mile describes the difficult last part in the transportation of people and packages from hubs to final destinations. Last-mile delivery is an increasingly studied field as the number of business-to-consumer (b2c) deliveries grow especially from e-commerce companies in freight transportation, and ride-sharing companies in personal transportation. Some challenges of last-mile delivery include minimizing cost, ensuring transparency, increasing efficiency, and improving infrastructure.
Last mile (telecommunications)
"Last mile" was originally used in the telecommunications industry to describe the difficulty of connecting end users' homes and businesses to the main telecommunication network. The last "mile" of cable or wire is only used by one customer. Therefore the cost of installing and maintaining this infrastructure can only be amortized over one subscriber, compared to many customers in the main "trunks" of the network.
In supply chain management last-mile describes a similar problem for transporting either people or freight. In freight networks, parcels can be delivered to a central hub efficiently via ship, train or other means, but they must then be loaded into smaller vehicles for delivery to individual customers. In transportation networks, "last mile" describes the rising marginal cost of getting people from a transportation hub such as an airport or train station to their final destination.
Transporting goods via freight rail networks and container ships is often the most efficient and cost-effective manner of shipping. However, when goods arrive at a high-capacity freight station or port, they must then be transported to their final destination.
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