Retailers Optimize Lastmile Logistics to Match Supply Chains

This paper delves into various supply chain models such as W2B, D2B, B2B, and E2B, and explores last-mile logistics matching strategies based on product categories (short shelf-life, FMCG, durable goods). It emphasizes that companies should optimize their supply chains according to product attributes and channel characteristics. The paper advocates for the adoption of intelligent, collaborative, green, and customized logistics solutions to enhance competitiveness. By tailoring logistics strategies to specific needs, businesses can improve efficiency and customer satisfaction within the evolving retail landscape.
Retailers Optimize Lastmile Logistics to Match Supply Chains

Picture this: bustling morning markets where fresh produce awaits wholesalers; supermarket shelves neatly stocked with consumer goods by midday; e-commerce platforms flooded with evening orders for rapid fresh food delivery. Behind these commonplace shopping scenarios lies a complex and precisely engineered supply chain network. Diverse product characteristics and consumer demands have given rise to varied supply chain models. Selecting the optimal last-mile logistics approach for different retail channels and product types is crucial for enhancing operational efficiency and reducing costs. This analysis examines mainstream supply chain models (W2B, D2B, B2B, E2B) and explores matching logistics strategies for different product categories.

I. The Transformation of Supply Chain Models and Retail Channels

Traditional supply chains typically revolved around wholesale markets (W) and distributors (D). However, with evolving consumer expectations and e-commerce growth, brands (B) and online platforms (E) have gained greater influence by connecting directly with end consumers. This retail revolution has fundamentally reshaped supply chain structures and operations.

W2B Model: Urban Distribution Challenges for Wholesale Markets

The W2B model primarily serves wholesale markets dealing in perishable agricultural products and small commodities. Fresh produce demands urgent transportation, typically via full truckloads to agricultural markets. Smaller goods and building materials often move through nationwide freight networks or dedicated logistics lines to specialized markets. Last-mile urban distribution in this model features immediate needs but relatively low frequency. Current solutions rely on independent drivers, merchant-owned fleets, and urban freight platforms that consolidate available capacity with standardized pricing by vehicle type. While improving efficiency, this approach faces intense competition from platforms like Manbang, DiDi, and Meituan due to low entry barriers. Platforms must enhance algorithms, expand services, and improve user experiences to outperform traditional operators.

D2B Model: The Changing Face of Traditional Distribution

The D2B model represents conventional distribution channels, where brands or manufacturers ship goods via full truckloads or dedicated lines to distributor warehouses, followed by urban delivery. Ownership transfers to distributors, who typically manage last-mile logistics with their own fleets. In fast-moving consumer goods (FMCG), delivery personnel often handle merchandising and customer relations. However, limited product portfolios lead to redundant deliveries and inefficient resource use. As e-commerce and new retail models emerge, many brands are reclaiming control over last-mile logistics through in-house operations or outsourcing, creating opportunities for third-party logistics providers.

B2B Model: Direct-to-Retail Logistics Demands

Amid consumer market upgrades, brands increasingly adopt B2B models to bypass intermediaries and deliver directly to retail endpoints, shortening supply chains. Short-shelf-life products typically use direct delivery, while FMCG and durable goods move through regional warehouses via dedicated lines or full truckloads before final distribution. Some dairy producers have established dedicated logistics companies handling full-cycle services from warehousing to last-mile delivery. As channels multiply and online-offline integration advances, brands must optimize routes to minimize delivery times and inventory mismatches. However, corporate urban delivery often operates as a cost center rather than profit generator. While some brands spin off logistics units, their growth potential remains constrained by corporate affiliations.

E2B Model: E-commerce Logistics Challenges

The E2B model reflects e-commerce platforms' evolution, connecting countless merchants with consumers while demanding greater logistics efficiency and coverage. Platforms employ diverse solutions including proprietary networks, third-party logistics, and crowdsourced delivery. Fresh e-commerce requires ultra-fast fulfillment through micro-warehouses enabling minute-range delivery, while other categories leverage optimized warehouse networks, AI routing, and autonomous delivery technologies. Challenges include peak-period capacity shortages, high last-mile costs, and inconsistent service quality. Emerging solutions like shared delivery networks, smart parcel lockers, and drone delivery aim to address these issues.

II. Product Characteristics and Supply Chain Matching Strategies

Consumer behavior and product attributes determine SKU and channel profiles, which in turn shape supply chain models. Products generally fall into three categories by shelf life: short-duration (0-7 days), FMCG (1 week-1 year), and durable goods (over 1 year), each requiring distinct supply chain approaches.

Short-Shelf-Life Products: Speed and Temperature Control

These time-sensitive items typically follow "direct sourcing + cold chain + micro-warehouse/store pickup" models. Last-mile delivery requires specialized refrigerated transport to prevent spoilage. Micro-warehousing enables ultra-fast fulfillment, while pickup points reduce costs and enhance convenience.

FMCG: Efficiency Through Multi-Channel Coordination

High-volume, fast-turnover goods typically use "central + regional warehouses + store delivery" networks. Efficient last-mile systems ensure timely store replenishment, while merged e-commerce and retail deliveries optimize costs. Third-party logistics partnerships can enhance network performance.

Durable Goods: Cost Optimization and Custom Services

Higher-value, longer-lasting products typically move through "central warehouse + line-haul + regional delivery/installation" models. Damage-proof transport, consolidated shipments, and installation services balance cost control with customer experience.

III. The Future of Last-Mile Logistics

Emerging retail trends are shaping several last-mile developments:

  • Smart technologies: AI routing, autonomous delivery, and smart lockers will improve efficiency
  • Collaborative models: Shared networks and crowdsourcing will maximize resource utilization
  • Sustainability: Electric vehicles and eco-friendly packaging will reduce environmental impact
  • Customization: Tailored solutions will address specific product and channel requirements

Selecting appropriate supply chain and logistics models remains critical for competitive advantage. Businesses must continuously adapt their approaches based on product characteristics, channel dynamics, and strategic objectives to navigate evolving market conditions.