Commingled vs. Dedicated Hubs: Which Solution Fits Your Last Mile Delivery Needs?
For last mile delivery, your warehouse solution is a critical component of customer satisfaction. FIDELITONE offers two different last mile models - dedicated or commingled (also known as multi-client). Each option comes with its own benefits and drawbacks.
In a dedicated model, you as the client manage your own warehouse operations. Our last mile drivers make your deliveries. With a commingled model, we manage warehouse operations. You would ship your goods to our facilities and we handle deliveries, returns, etc. on the backend. This is usually the first step a business takes in outsourcing.
Should you have a dedicated warehouse, or do you share warehouse space with others?
Which is the best fit for your business? We brought in FIDELITONE supply chain expert, Mike Eppinger, SVP of Strategic Accounts, to give us a quick rundown on the benefits of each.
Commingled Hub: Operating from a strategically located warehouse
Multi-client last mile delivery services enable you to outsource both warehouse and delivery operations. By commingling with other FIDELITONE clients, you take advantage of additional volume we have in the warehouse. Clients that have a small volume of orders per week don’t have to wait to accumulate orders because their orders ship with others in a truck. This way, customers get orders faster.
This option works for companies that need to expand both warehousing and delivery operations and require a high-touch, high-feel delivery experience for their customers.
- Saves money if you don’t have the volume to fill a truck consistently.
- Increases speed to customers for small volume orders.
- Leverages our technology when you send orders to multiple FIDELITONE hubs.
- Eliminates some fixed expenses. If you have your own truck, there are more fixed expenses - truck, employees, systems. With commingled, you only pay when FIDELITONE makes a delivery.
- High quality, consistent service level. We look at clients to see if they will commingle well together. For example, we commingle high-end furniture clients in one truck. Our drivers use the same methodology and customer experience. Even though there are other clients on the same truck, it feels like a high-quality service because the driver is familiar with the product category.
Dedicated Hub: Operating from your warehouse
Dedicated last mile delivery services enable you to outsource the delivery portion while retaining product on site. They also offer additional options to choose from—such as adding last mile employees and technology on site to manage orders, immediate visibility into order activity, delivery route optimization, and inventory management. You can customize this solution based on your needs and resources.
- The delivery team becomes very familiar with the product since they only have to perform one operating procedure for one client.
- Reduced amount of errors. The team has a higher level of expertise when putting items together.
- Ability to use your own technology whether it be mobile applications or handheld devices.
- Increased branding. Our team can wear your branded uniforms and drive branded trucks. This could appear as higher caliber to the customer.
… Or both?
We also have clients that choose both models. They might use commingled in smaller markets where there’s not enough volume to justify opening their own facility. As their business grows, they decide to open their own building to manage growth. Whatever your needs, we’ll be there to support your growth as last mile delivery experts.
The truth is no two best-fit solutions look the same. FIDELITONE is unique in that we can provide both commingled and dedicated models. Last Mile experts at FIDELITONE are ready to hear about your needs and help build the right solution for you and your customers. We partner with you to help earn your customers’ loyalty. Contact us so we can tailor a solution to your needs.