The "last mile." This term, once confined to logistics circles, is now at the heart of our digital economy and customer experience. It is the shortest, most expensive, and most complex stage of the entire supply chain. It is the moment of truth when a digital promise is transformed into a physical experience.
But it is also, and this is less often mentioned, the most dangerous zone: 60% of incidents (loss, theft, breakage) occur during this final stage, even though it represents less than 2% of the total distance traveled by a package. Every day, thousands of companies lose money not because of a bad product or poor marketing, but because of a package that is lost, stolen, or damaged just a few meters from its final destination.
Mastering the last mile is no longer an option; it is a condition for survival and profitability. This guide is not just a theoretical overview. It is an operational dive into the last-mile ecosystem to give you the keys to understanding, optimizing, and above all, securing this critical stage.
By the end of this article, you will not only understand what the last mile is and how to optimize it, but more importantly, how to financially protect your deliveries against the concentrated risks of this final stage.
What is the Last Mile? Definition and Challenges
The "last mile" refers to the final stage of the delivery process: the moment when a package leaves a local distribution center (hub, urban warehouse, cross-docking point) to arrive at its final destination, whether it be a private home, a company's premises, or a pickup point.
In the diagram above, the last mile corresponds to the stage shown in yellow: from the urban warehouse to the end customer.
Why is the Last Mile so Strategic?
Although it is the shortest distance (usually a few kilometers, or even a few hundred meters), the last mile has become the center of gravity of modern logistics for four major reasons:
1. It is the only point of physical contact with the end customer.
All your marketing efforts, all your product quality, all your digital experience converge at this moment: the receipt of the package. A rude delivery person, a damaged package, a failed delivery... and the entire customer experience falls apart. According to a study by FEVAD, 84% of consumers no longer recommend a brand after a bad delivery experience.
2. This is the least effective and most costly step.
The last mile accounts for more than 50% of the total cost of delivery on average, even though it only represents 10% of the distance traveled. Why? Because it is the least shared: a truck traveling 500 km with 5,000 packages is extremely efficient. A delivery driver traveling 50 km to deliver 120 packages to 120 different addresses is much less so.
3. This is where all modern expectations crystallize.
Speed (24-hour or even same-day delivery), flexibility (choice of delivery slot, real-time address changes), personalization (direct communication with the delivery driver), and environmental responsibility (clean vehicles, recyclable packaging). The last mile has become the battleground for competitive differentiation.
4. This is the area with the highest concentration of claims.
And it is this often overlooked point that can tip a profitable business into the red. The figures speak for themselves: 60% of logistics claims occur during the last mile. Theft, loss, breakage, incorrect addresses... This final stage combines all the risks. We will come back to this in detail later.
The 5 Fatal Mistakes of the Last Mile:
- Mistake 1: Not checking addresses - 15% of avoidable failures, even more common on sales platforms where sometimes the first and last names match the username.
- Mistake 2: Underestimating package theft —up 40% since 2022, with more and more home security cameras (CCTV) showing porch pirates stealing packages.
- Mistake 3: Neglecting ad valorem insurance - average loss €247/claim (goods, processing costs, brand image, etc.)
- Mistake 4: Not proactively communicating with the customer —package dispatch, delivery window, delays, etc.
- Mistake 5: Choosing the cheapest option instead of the most suitable one
The Last Mile in Numbers: A Booming Market
The figures illustrate the enormous importance of this segment and its structural challenges:
- Global market size: Valued at over $200 billion in 2025, the last mile market is expected to reach nearly $325 billion by 2029, according to Mordor Intelligence. This explosive growth (+62% in 4 years) is driven by the rise of e-commerce, urban densification, and the collective appetite for fast delivery.
- The weight of costs: The last mile accounts for an average of 50 to 53% of the total cost of delivery. It is the most expensive link in the entire chain. For a delivery costing €10 in total, €5 to €5.30 is spent on the last mile alone (difficulty of pooling).
Breakdown of last mile costs:
- Delivery driver's salary: 40% of marginal cost
- Fuel/energy: 25%
- Vehicle (depreciation/leasing): 15%
- Delivery failures (customer absent): 10-15%
- Insurance and miscellaneous: 5-10%
Customer demand: According to industry data, 66% of retailers now forced to offer next-day delivery, and 44% of consumers expect their packages to arrive in less than two days. This time pressure generates additional costs and automatically increases the error and damage rate.
The impact of failed deliveries: 15 to 20% of deliveries require a second attempt (customer absent, incorrect address, inability to access). Each failed attempt doubles the cost of delivery and increases the risk of loss or theft during temporary storage.
These figures pose a difficult equation: how can costs be kept under control, service quality high, and financial risks contained in the face of exploding demand?
Last Mile Players and Models
The last mile is not uniform. There are several delivery models, each with its own specific advantages, costs, and risks.
1. Traditional Home Delivery
How it works:
Aprofessional delivery person (Chronopost, DHL, Colissimo, UPS, etc. ) will deliver the package directly to the customer's home, with or without a signature.
Advantages :
- ✅ Maximum comfort for the customer
- ✅ Suitable for bulky or heavy products
- ✅ Premium image
Disadvantages :
- ❌ Highest cost (€6 to €12 depending on distance and delivery time)
- ❌ High failure rate if customer is absent (15-20%)
- ❌ Risk of theft from doorstep (if delivered without signature)
Average loss ratio observed: 0.5 to 3% (theft, breakage, loss)
2. The Relay Point
How it works:
The package is delivered to a local store (Mondial Relay, Relais Colis, Pickup, etc.). The customer can pick it up at their convenience.
Advantages :
- ✅ Low cost (€3 to €6)
- ✅ Flexibility for the customer (extended hours)
- ✅ Virtually zero failure rate (package waits for customer)
Disadvantages :
- ❌ Constraint for the customer (travel required)
- ❌ Limited in size/weight (often max. 30 kg and over one meter)
- ❌ Not suitable for very fragile or high-value products
Average loss ratio observed: 0.75 to 2%
3. Automatic Instructions
How it works:
Secure lockers installed for free access (Pickup, Amazon Hub, InPost, etc.). Customers receive a code to open their locker and collect their parcel 24 hours a day.
Advantages :
- ✅ 24/7 availability
- ✅ Secure (locked locker/code)
- ✅ Medium cost (€4 to €8)
Disadvantages :
- ❌ Territorial coverage still incomplete
- ❌ Limited in size (standard lockers)
- ❌ Requires heavy infrastructure
Average loss ratio observed: 0.75 to 2.2%
4. Click & Collect / Drive
How it works:
The customer orders online and picks up their order in-store or at a dedicated drive-through location.
Advantages :
- ✅ Minimal cost for the retailer €0 to €2)
- ✅ Opportunity for additional in-store sales
Disadvantages :
- ❌ Requires a network of physical stores
- ❌ Significant constraint for the customer
Near-zero accident rate: 0.2% ( internal logistics flow/damage noted before delivery, etc.)
5. Collaborative Delivery / Crowdshipping
How it works:
Platforms (Stuart, Uber, Deliveroo, Cocolis, etc.) mobilize independent delivery drivers for ultra-fast deliveries (1 to 4 hours).
Advantages :
- ✅ Express delivery (perfect for food and fresh produce)
- ✅ Geographic flexibility
Disadvantages :
- ❌ High cost (€8 to €20 depending on urgency)
- ❌ Variable accident rate (depends on the quality of the delivery driver)
- ❌ Less suitable for high-value products
Average loss ratio observed: 1.5 to 3.5%
Comparison Table of Last Mile Models
The Specific Risks of the Last Mile: The Danger Zone
Here is a topic that few articles address head-on, but which has a direct impact on your profitability: the last mile accounts for 60% of logistics claims. Why is there such a concentration of risk?
1. Multiple Handling Causes Damage
The journey of a package in the last mile:
- Unloading of long-distance trucks at the urban hub
- Manual sorting by delivery route
- Loading into the delivery vehicle (van, cargo bike, etc.)
- Repeated handling during delivery (packages stacked, moved, rearranged)
- Final disposal (sometimes thrown over a gate, left out in the rain, etc.)
Every handling operation carries a risk of breakage, especially for fragile items (electronics, glass, ceramics). Time pressure (120 to 180 parcels to deliver per day) exacerbates the problem: delivery drivers do not have time to handle each parcel with care.
2. Explosive Growth in Parcel Theft
Parcel theft has skyrocketed in recent years. According to industry data, incidents increased by nearly 40% between 2022 and 2024.
The three types of theft:
- Theft during transit (while on the delivery route): Rare but possible, especially if the delivery driver leaves their vehicle unlocked and unattended. Usually involves several packages at once.
- Doorstep theft: The most commontype . The delivery person leaves the package "at the door" without a signature (despite your instructions in some cases), and a passerby or malicious neighbor steals it within minutes. Densely populated urban areas and unsecured building lobbies are the most affected.
- Organized theft by collusion: Less common but on the rise: a customer places an order, receives the package, then claims never to have received it, even though the tracking information indicates "delivered." This type of fraud is difficult to prove.
A typical case that ruins margins: You ship an iPhone worth €1,200. It is delivered "to the door" at 2 p.m. (no signature obtained, even though you had requested one). At 2:15 p.m., a passerby steals it. The tracking shows "successfully delivered." The customer contacts you: "I haven't received anything." Who pays?
3. Time Pressure Increases Errors
Last-mile delivery drivers work under intense pressure. A Chronopost Chronopost or Colissimo delivery driver must deliver 120 to 180 parcels per day, or one parcel every 4 to 6 minutes (including breaks and travel time).
Direct consequences:
- Packaging thrown away roughly (breakage of fragile items)
- Address errors (wrong building, wrong floor, wrong name)
- Non-compliant filing (no signature obtained when it was mandatory)
- Failure to comply with instructions (delivering to neighbor when prohibited)
Revealing statistic: 15 to 20% of deliveries require a second attempt. Each failure doubles the cost AND doubles the risk (new handling, new transport, temporary storage that is often insecure).
4. The "Last Mile" Problem
The package arrives at the address provided... but where should it be left?
Common scenarios:
- Mailbox too small → package left on the floor in the lobby
- Digicode not provided or incorrect → package left in front of the building
- Customer absent → delivery to neighbor (risk of non-recovery)
- Business address closed (Saturday/Sunday) → return to warehouse
Each of these situations creates a blind spot in terms of responsibility: who is responsible if the package disappears in the building lobby? If the neighbor claims never to have received it? If the package remains in a garbage room for three days?
Table of Responsibilities According to Situations
Solution: Specialized Last Mile Parcel Insurance
Faced with these concentrated risks and compensation limitations, companies that control their profitability are adopting a strategy of decoupling insurance.
Rather than relying solely on the Carrier basic insurance Carrier Limits , numerous exclusions, long delays), you take outindependent parcel insurance that covers the actual value of your goods, regardless of the last-mile delivery method chosen.
Why Carrier Insurance Is Unsuitable for Last Mile Delivery
Problem 1: Limits
Colissimohas a maximum coverage of €5,000 (see our analysis of Colissimo's insurance offering), while Chronopost €7,600. If you regularly ship smartphones, computers, watches, or professional equipment, you are systematically underinsured.
Problem 2: Critical exclusions
Jewelry, precious metals, works of art, and luxury watches are often excluded or very restricted in standard carrier contracts (see details on watches and luxury leather goods).
Problem 3: Paralyzing compensation delays
Standard carrier insurance policies take an average of 60 to 90 days to pay out compensation. During busy periods (check out our guide to understanding the peak season), these delays can reach 120 days. During this time, your cash flow is tied up: you have reimbursed the customer and restocked your inventory, but you have not yet received compensation.
Problem 4: Structural conflict of interest
When a Carrier your package, it is in their financial interest to minimize or refuse compensation. They are both judge and jury. Cases drag on, supporting documents pile up, and ultimately, reimbursement is often only partial.
Parcel Transport Delivery Insurance
Specialized parcel insurance (learn more about parcel insurance and make the best decision) offers four key advantages for the last mile:
- ✅ Limits to reality: up to €100,000 per package, covering even very high-value products (details on high-value shipping insurance)
- ✅ Express compensation: 48 to 72 hours to preserve your cash flow and customer relationships
- ✅ Total independence: the insurer makes decisions independently of Carrier, with no conflict of interest. Whether the Carrier or denies liability, you will be compensated based on your insurance policy.
- ✅ Wide coverage: high-tech, watches, jewelry, luxury leather goods, legal CBD... Products often excluded elsewhere are accepted.
- ✅ Automation possible: native integration with your CMS (Shopify Webhook, WooCommerce Webhook, PrestaShop Module) or via API with your TMS/OMS to automatically ensure each last-mile delivery.
Last Mile Trends and Outlook (2025-2030)
Tomorrow's last mile will be hyper-personalized, sustainable, and technological.
1. Hyper-Personalization of Delivery
What emerges:
- Choice of delivery slot within a half-hour window (already offered by Amazon and DHL)
- Change destination in real time via mobile app
- Direct communication between delivery person and customer (chat, call, geolocation)
- Saved preferences (always deliver to the neighbor above, never leave outside, etc.)
Concrete example: Stuart and Uber already offer real-time GPS tracking and direct communication.
2. Low Emission Zones (LEZ) and Green Deliveries
Regulations in progress:
- Paris: Low Emission Zone extended to the entire inner city area / ring road
- Lyon: Progressive low-emission zone until 2026
- Marseille, Toulouse, Bordeaux: deployment 2025-2027
Consequences: Diesel/gasoline vehicles will gradually be banned from city centers. Transport companies must invest heavily in electric fleets, cargo bikes, and hydrogen vehicles.
Impact on costs: According to initial studies, the green transition could increase last-mile costs by 10 to 15% in the short term, before stabilizing thanks to fuel savings and government subsidies.
3. Emerging Technologies
- Delivery drones: Still experimental in France (strict regulations), but Amazon Prime Air and Alphabet Wing are actively testing them in the US and UK. Potential for rural areas or islands, but urban adoption limited by safety constraints.
- Robots de livraison autonomes : Starship Technologies et Nuro testent des robots roulants pour livraisons de proximité (< 5 km). Adapté aux campus universitaires, zones résidentielles fermées, parcs industriels
- Artificial Intelligence for route optimization: AIalgorithms optimize routes in real time based on traffic, customer slots, and priorities. Estimated cost reduction: 15 to 20%.
- New generation smart lockers: Connected, refrigeratedlockers for food items, with facial or biometric recognition for opening. InPost and Pickup are rolling out these solutions in France.
In Conclusion: The Last Mile, a Double-Edged Strategic Lever
The last mile is no longer just an operational issue. It has become a major strategic lever that can make or break a business.
On the one hand, a controlled last mile offers you:
- An exceptional customer experience (loyalty, word of mouth)
- Optimized costs (smart choices of delivery methods)
- Competitive differentiation (speed, flexibility, eco-responsibility)
On the other hand, a poorly secured last mile can slowly ruin you:
- Uncovered claims that eat into your margins
- Dissatisfied customers who never return
- Cash flow blocked while waiting for compensation that never arrives
The three pillars of a controlled last mile:
- ✅ Choose the right delivery methods for your products and customers (home delivery, pickup point, parcel locker).
- ✅ Optimize your processes to reduce costs and delivery failures (address verification, proactive communication, choice of carriers)
- ✅ Secure your cash flow financially with insurance tailored to the reality of last-mile risks (Limits , fast compensation, broad coverage).
The companies that will succeed in the decade from 2025 to 2030 will not necessarily be those that deliver the fastest or the cheapest. They will be those that understand that the last mile is a complex system where operational excellence must be accompanied by appropriate financial protection.
Investing in optimizing AND securing your last mile means investing directly in the growth and sustainability of your business.
The last mile is the shortest... but it's also the most decisive. Don't let it become your Achilles heel.
To go further
To deepen your understanding of logistics and e-commerce insurance, check out our specialized guides:
📦 Guides by situation
- Parcel insurance: the complete guide
- Shipping insurance for high-value products (>€5,000)
- Peak Season Guide: Securing your deliveries during busy periods
💎 Guides by product type
- Parcel insurance for luxury watches (Chrono24 dealers)
- Insurance for the delivery of luxury leather goods and jewelry
🔍 Comparisons and analyses
- Colissimo insurance / La Poste: comprehensive analysis
- UPS Ad Valorem Insurance: Detailed Guide
- DHL Ad Valorem Insurance: Detailed Guide
- Sendcloud insurance: comparison and alternatives
- Packlink Pro Insurance: limitations and solutions
- Parcel insurance solutions comparison tool