Costs Are Hiding in Every Last Mile Delivery
Are hidden costs actually outweighing the benefits of your delivery program? Before you answer that question, let’s make sure you have the full picture. Home delivery programs are complex. With as many moving parts as there are, it’s easy to overlook some of the costs that add up—whether you’re managing your own delivery program or outsourcing it.
We’ve rounded up some of these commonly overlooked costs in home delivery programs. Some may seem like no-brainers, and this certainly isn’t an exhaustive list. If nothing else, we want to help you evaluate the total cost of home delivery and to see how a last mile provider, like J.B. Hunt Final Mile, can help you uncover and control those costs.
Let’s start with the importance of onboarding safe delivery team members. Our industry delivers into customers’ homes, and we should all require delivery personnel to be highly vetted and background checked. To get quality delivery teams at J.B. Hunt, we have implemented one of the strictest screening programs in the country. It includes drug tests, background checks, and follow-up checks throughout their employment. In fact, only about 25% of applicants make it through the process. It’s an investment, but we’re glad to make it.
Protective equipment such as gloves, booties, and floor coverings aren’t new in our industry. But 2020 and the COVID-19 pandemic brought a new set of personal protective equipment. Hand sanitizer, disinfecting sprays, and masks are just a few of the tangible pieces of safety equipment we’ve added. Throw in the extra time cleaning and you are suddenly reducing the number of stops you can make in a day. These costs are worth it to protect delivery teams and customers, but they must be considered.
The cost to train delivery teams on safety protocols, is not nearly as much as you may have to deal with in the aftermath of an accident. There are legal costs, damaged goods, down trucks, down delivery teams, and even the most understanding customers still want their delivery. Safety isn’t just an add-on service; it’s a responsibility and it requires continuous work and training to ensure consistency. And you guessed it, that takes an investment.
Delivery Team Costs
We briefly touched on this before, but are you aware how much time and expense goes into just onboarding a new delivery team member? There are lots of phone calls and interviews that cost time and money. Once you’ve found the right candidate and fully vetted their background you then start the work of training. You will teach them about your own culture and expectations, and you will spend time and money training them on the specific skills required to execute your customers’ deliveries. The more complex the product, the more training required. Then down the road if that team member doesn’t meet your standards or decides to leave, you’ll have to start the process over again.
Beyond the tangible costs of labor and resources, it is important to count the intangible, yet costly effects of brand damage. While it’s hard to quantify the full value of a brand, it’s easy to recognize the value of repeat business or lost orders from customers who’ve had a bad experience. Drug tests and background checks are the right first steps in choosing the right delivery teams but training those teams on how your company expects them to interact with customers and handle your products is equally as important. More and more consumers look to online ratings and reviews before making a purchase, and you don’t want an angry customer leaving a poor one due to a bad delivery experience. Your home delivery teams will leave a lasting impression, and home delivery is a part of the overall brand experience your customers will remember. You invest in your brand in many ways, are you making the right investment in your home delivery program to ensure it creates an experience consistent with your brand?
The total cost of delivery can be overwhelming, and there are many we didn’t cover. It’s important to see how they all stack up when you develop a home delivery program the right way. Need help? We would be glad to use our experience to help you identify the hidden costs as well as savings that can make your home delivery program an asset rather than a liability for your company.