The Biggest Challenges in Last Mile Delivery

The Biggest Challenges in Last Mile Delivery

TL;DR: The last mile problem in B2B logistics in Belgium is costly and complex, involving operational inefficiencies, geographic barriers, and regulatory constraints. Challenges like traffic congestion, failed deliveries, and sustainability pressures make this segment difficult to manage. However, B2B businesses are navigating these hurdles with greener delivery options (EVs, cargo bikes), smarter routing technologies, and multi-carrier strategies. This article delves into the core challenges and how Belgian companies are adapting to improve efficiency and compliance.

What is the “Last Mile Problem” and Why Is It So Costly and Complex?

The “last mile problem” refers to the final stage of delivery, from a local distribution center to the customer’s location. This part of the supply chain is considered the most costly and complex, especially in urban areas.

• Costliest stage: The last mile often accounts for 28–53% of total delivery costs due to inefficiencies, labor expenses, and increased fuel consumption (Source).
• Failed deliveries: Failed deliveries are a major cost driver. Poor address accuracy or unavailability of the recipient causes additional attempts or rerouting, which drives up operational expenses (Source).
• Sustainability pressures: Environmental regulations, particularly Low Emission Zones (LEZ) in cities like Brussels and Antwerp, are compelling companies to adopt EVs, cargo bikes, or green alternatives to meet emission standards (Source).
• Regulatory complexity: Businesses must navigate complex EU and local regulations, including emission standards and road access rules, which add operational complexity (Source).

Key takeaways:

• The last mile is the most expensive part of the delivery process.
• Traffic, failed deliveries, and emission regulations increase costs.
• Belgian cities enforce strict emissions rules, requiring greener delivery options.

What Operational, Geographic, and Regulatory Issues Affect Last Mile Delivery in Belgium?

Belgium’s geography and regulatory environment create several challenges for last-mile logistics, particularly in urban areas.

• Urban congestion: Brussels, Antwerp, and Ghent have some of Europe’s highest congestion rates, which slow delivery times and raise operational costs (Source).
• LEZ zones: The LEZ restrictions in Brussels and Antwerp exclude high-emission vehicles, pushing companies towards electric vans and cargo bikes (Source).
• Rural delivery challenges: Lower population density and longer distances in rural zones increase per-delivery costs, especially for businesses serving smaller producers (Source).
• Cross-border complexity: Deliveries to France and the Netherlands must clear customs, comply with disparate rules, and manage tariffs, adding cost and complexity (Source).

Key takeaways:

• Urban congestion and narrow streets slow delivery.
• LEZ regulations require fleet upgrades or greener alternatives.
• Cross-border logistics involve customs and regulatory hurdles.

What Challenges Do Failed Deliveries, Address Accuracy, and Delivery Window Pressure Pose?

Quick Answer: Failed deliveries are among the highest costs in last-mile delivery. Inaccurate addresses, missed delivery windows, and communication breakdowns exacerbate delays and raise costs.

1. Inaccurate addresses: Out-of-date or incorrect addresses cause 10–20% of delivery failures, requiring re-delivery and creating B2B inventory bottlenecks (Source).
2. Delivery window pressures: Tightly scheduled deliveries tied to production timelines mean delays can disrupt customer operations (Source).
3. Missed deliveries: Failed attempts force rescheduling and returns, quickly increasing logistics costs (Source).

Key takeaways:

1. Inaccurate addresses cause delays and extra expense.
2. Missed deliveries disrupt supply chains and increase cost.
3. Deliveries must align with B2B production to avoid issues.

What Are the Complications in Cross-Border and Rural Zone Deliveries?

Quick Answer: Cross-border shipments to France or the Netherlands involve customs, tariffs, and different regulations, while rural deliveries involve longer distances and fewer stops, reducing scale efficiency.

1. Customs and regulations: Post-Brexit shipping to the EU may require clearance, paperwork, tariffs, and inspections (Source).
2. Rural zone challenges: Long routes and low delivery density raise costs and demand efficient route planning (Source).
3. Transport accessibility: Rural infrastructure limits vehicle access, making multi-modal solutions like parcel lockers necessary (Source).
4. Cross-border competition: Belgium’s role as a logistics hub adds competitive carrier pressures and complexity (Source).

Key takeaways:

1. Customs and tariffs slow cross-border shipments.
2. Long distances and low density elevate rural delivery cost.
3. Multi-modal and creative infrastructure are essential.

What Sustainability and Emissions-Related Challenges Do B2B Companies Face?

Quick Answer: With last-mile deliveries contributing up to 30% of supply chain CO₂ emissions, EU and local LEZ mandates are pushing B2B firms toward EVs, cargo bikes, and green routing.

• Environmental regulations: LEZ restrictions in Brussels and Antwerp exclude high-emission vehicles, leading to fines, operational disruptions, and the need for greener fleets (Source).
• Sustainability targets: EU directives like the Green Deal incentivize green logistics—but EVs mean higher upfront costs and infrastructure needs (Source).
• CO₂ emissions: Last-mile delivery can represent up to 30% of total supply chain emissions, highlighting the need for greener vehicles, bikes, and optimized routes (Source).
• Public demand: B2B clients require sustainable choices, and consumer preference for eco-friendly delivery favors green-first companies (Source).

Key takeaways:

• LEZ and EU Green Deal rules mandate greener fleets.
• CO₂ accountability and public demand drive change.
• EVs cost more upfront—but improve ROI and brand image long term.

What Labour Constraints, Cost Pressures, and Customer Expectations Affect Last-Mile Delivery?

Quick Answer: Driver shortages, rising costs, and fast-turnaround expectations force Belgian B2B logistics to innovate with tech, multi-carrier strategies, and tiered-express options.

• Labour shortages: Skilled driver shortages—and the need for EV training or heavy-freight experience—limit delivery capacity in urban areas (Source).
• Rising operational costs: Inflation and fuel price increases demand route-optimizing tech and multi-modal fleets to cut costs (Source).
• Customer expectations: B2B players want same-day slots with real-time tracking—forcing logistics providers to deliver faster, smarter (Source).
• Cost‑benefit tradeoffs: Offering express vs. standard tiers requires balancing speed, cost, and profitability (Source).

Key takeaways:

• Labour gaps restrict last‑mile capability.
• Rising costs push tech and delivery innovation.
• Customer demands drive faster fulfillment—but at cost.