Kanan says last-mile 53%

Last-mile delivery is the expensive part nobody sees. The truck has already crossed oceans, cleared ports, and reached a regional hub — but the final handoff to the actual destination is where the cost curve bends upward. That is the basic point behind Kanan Ltd.’s post: if you want to cut logistics spend, the last mile is usually where the waste hides. The catch is that the headline number needs a little unpacking before anyone starts redesigning a network. ### What is the “last mile” here? The last mile is the final leg from a warehouse, depot, or local hub to the end destination. In parcel delivery, that means a home. In hospitality or island logistics, it can mean a resort, marina, villa cluster, or remote property. This leg looks short on a map, but it is operationally ugly — small drops, irregular demand, narrow delivery windows, empty backhauls, and lots of labor wrapped around low shipment density. ### Where did the 53% figure come from? The 53% figure is real, but it is usually attached to total shipping, delivery, or fulfillment costs — not always to the full supply chain. Multiple industry explainers repeat that last mile now makes up about 53% of total delivery spend, up from roughly 41% a few years earlier. A Statista summary shows that same 41%-to-53% shift between 2018 and 2023. (maersk.com) ### So is “53% of supply-chain costs” wrong? Basically, it is too broad. The cleaner version is this: last mile can be about 53% of shipping or fulfillment costs, while Capgemini-linked figures often put it at about 41% of total logistics or supply-chain costs. Those are both big numbers, but they are not interchangeable. Saying “53% of total supply-chain costs” makes the burden sound larger than the benchmark usually supports. (statista.com) ### Why is the last mile so expensive? Because line-haul transport scales and last-mile transport fragments. Moving one full container between two hubs is like taking an elevator straight to the right floor. Last mile is like carrying individual bags down a hotel corridor, one room at a time, with half the guests changing their minds about timing. Fuel, labor, failed deliveries, routing complexity, and low stop density all pile up here. (capgemini.com) ### Why does this matter more for islands and resorts? Remote hospitality networks compound every bad property of last-mile logistics. Demand is lumpy. Storage space is limited. Deliveries may depend on ferries, barges, small trucks, or inter-island transfers. A fragmented replenishment model — lots of small urgent orders to lots of separate sites — pushes unit costs up fast. That means a resort operator can feel “last mile” not as a theory, but as margin leakage in food, housekeeping, maintenance, and guest supplies. (sloanreview.mit.edu) This is an inference from how last-mile cost drivers work in low-density networks. ### What actually reduces that spend? Network design more than heroic dispatching. Pooled regional stock, scheduled replenishment, consolidated inbound trunks, and fewer emergency runs usually do more than shaving pennies off carrier rates. If the expensive part is the final fragmented leg, then the smart move is to make that leg happen less often and with fuller loads. Route optimization software helps, but the bigger win often comes earlier — changing how inventory is positioned. (sloanreview.mit.edu) ### Does customer service suffer if you consolidate? It can, but only if inventory is too thin or reorder rules are sloppy. The better version is not “deliver less.” It is “deliver less chaotically.” A well-run pooled model trades random urgent drops for predictable service levels. That is especially useful where transport capacity is fixed and weather or port schedules can break the plan. (sloanreview.mit.edu) ### Bottom line? Kanan’s core point holds up: the last mile is where logistics costs get painful. But the precise benchmark matters. Think 53% of shipping spend, not necessarily 53% of the entire supply chain — and then design the network around that reality. (maersk.com)