Last mile is the last and most complex leg of the shipment’s journey in the logistics chain. In B2B logistics, this means delivering the cargo from a transport hub to the final bonded warehouse or consignee’s warehouse. Even though the term “last” is used here, the distance between the hub and consignee could run hundreds of kilometers.
Typical Last Mile Problems
1. High Costs
Last mile has always been and remains a resource-intensive element of logistics: according to Business Insider, last mile accounts for over half (53%) of all shipping costs. In B2B logistics, cost optimization can be achieved through a variety of methods, including:
consolidation of small shipments
vehicle load optimization
process approach to last mile delivery
2. Intransparent Pricing
Lack of transparency in pricing is one of the inherent issues of last mile in B2B logistics and the cause of unjustifiably high prices charged by forwarders. For instance, a customer sitting in Barcelona or Singapore does not always have easy access to import tariffs of Tashkent airport or Tashkent Tovarniy railway station - be cargo handling or storage services. For customers, it is crucial to have a reliable and responsible partner at such key transport hubs.
3. Visibility Issues
Shipment visibility is key to solving the last mile problem as it enables all players of the logistics chain to track the cargo, its routing and condition. Poor visibility remains a significant problem in last mile logistics, preventing proper tracing of the shipment, causing delays and negatively affecting process efficiency. At XSCALE, we put a special emphasis on last mile visibility - our 24/7 operational control tower ensures that our customers receive visibility reports near real-time through email and SMS notifications.
4. Long Delivery Times
While airfreight from Amsterdam to Tashkent takes less than 6 hours, delivery from Tashkent airport to consignee’s warehouse within the limits of Tashkent may take 2-4 days. The bulk of this time is spent on paperwork, payment of airport fees, customs duties as well as obtaining certificates required for import clearance.
Peculiarities of Last Mile in Uzbekistan
Rankings in Ease of Doing Business Index
According to the latest rankings in Ease of Doing Business of the World Bank, Uzbekistan ranks 152 out of 190 countries in Trading Across Borders.
Time to import - border compliance: 111 hours
Cost to import - border compliance: 278 US Dollars
Time to import - documentary compliance: 150 hours
Cost to import - documentary compliance: 242 US Dollars
Airfreight Consolidations for Uzbekistan-bound shipments
At present, consolidation of Uzbekistan-bound air shipments under one MAWB (master airway bill) is not possible. This is because deconsolidation of air cargo is not allowed upon arrival as the customs authorities of Uzbekistan do not recognize HAWB (house airway bill) as a valid transport document. That means every air shipment must be accompanied by direct MAWB while certain rules are to be followed when drafting documents.
Drafting Shipping Documents for Uzbekistan
It is extremely important that you make sure your shipment bound for Uzbekistan is accompanied by a correct set of shipping documents. Strict customs regulations of this country mean that if you get paperwork wrong or have discrepancies between your documents and the actual cargo details, you are likely to get into trouble with local customs authorities. This could mean delays in clearance, increase in import clearance costs or even payment of outsized fines - all of which can be avoided with careful advance planning.
Counting the Cost of Last Mile
Last mile delivery charges are calculated based on the cargo information provided by the customer. The cost of the last mile, including forwarder’s fees, depends on the Incoterms applicable to a given shipment.
When the shipment is under DDP (Delivered Duty Paid or door delivery) term, you must provide the following information to calculate the complete cost, including customs duties and taxes:
Packing details - weight and dimensions of each piece
Invoice value of the goods
Requirements for storage, handling and transport, if any
It is worth noting that the HS codes indicated on your invoice may not always match with HS codes in the Uzbekistan Customs database. In such cases, our customers brokers will help you assign a correct HS code to your goods in order to avoid any issues with payment of customs duties and other fees when importing.
DAP or DPU Shipments
To calculate the cost of DAP (Delivered At Place) or DPU (Delivered At Place Unloaded), it is enough to know packing details and handling requirements for the shipment (e.g. temperature control, etc.). Regardless of shipping terms, our logistics teams at Xscale are prepared to provide a complete range of last mile services for timely and safe delivery of your shipments across Uzbekistan and Central Asia.
Xscale is a logistics and supply chain management company headquartered in Singapore. We operate out of our hubs in Singapore, Tashkent, Frankfurt and London, providing a complete range of logistics and procurement services to businesses around the world. We combine our global network, industry expertise and highly competent professionals to work alongside our customers and solve their supply chain challenges. Contact Us if you require any assistance.