Route optimization reduces delivery costs by 20-30%, according to a 2025 industry analysis. Yet most Singapore sellers still ship orders one at a time, paying full price for every parcel.
Understanding what you're actually paying for last-mile delivery is the first step. Once you see where the money goes, these strategies become essential.
Batch deliveries by location, not checkout time.
The instinct is to fulfil orders in the sequence they come in. A 9am order ships first, then 10am, then 11am. But if those three orders are going to Jurong, Tampines, and Bedok, you're paying for three separate trips across the island.
Grouping orders by destination zone instead of checkout time lets you consolidate routes. Five orders to the East can ship together. Three orders to the West go in another batch.
According to a Delivery Hero case study with AWS, optimising middle-mile routing reduced total costs by 24%, driven primarily by a 22% decrease in mileage. The same principle applies to your last-mile: fewer kilometres means lower costs.
If you're shipping more than five orders daily, batching by location should be your first cost-cutting move.
Cut failed deliveries before they happen.
In Singapore, roughly 10% of deliveries fail on the first attempt. Each failed delivery triggers a redelivery cost, wasted driver time, and potential customer complaints.
The main reasons? Customer not home, wrong address, or no response at the door. These are predictable and preventable.
Confirm delivery windows with customers before dispatch. Use real-time tracking so recipients know exactly when to expect their parcel. For high-value orders, a quick SMS or WhatsApp confirmation can prevent a $10 redelivery fee.
According to Loqate's 2023 delivery report, failed deliveries cost an average of $17.20 per parcel globally. In Singapore's context, where every delivery costs $2-$3 in operational overhead according to local logistics data, a 10% failure rate adds up fast.
Reducing your failure rate from 10% to 5% on 100 monthly orders saves roughly $85 in hidden costs. For context on how these costs compare internationally, see how Singapore's last-mile costs stack up against global markets.
Use route-optimised multi-stop delivery.
Single-parcel delivery services charge a flat fee regardless of where your other orders are going. If you have five orders shipping to five addresses, you pay five separate delivery fees.
Multi-stop delivery changes the math. A driver picks up all five parcels and delivers them in one optimised route. The per-stop cost drops because fuel, time, and distance are shared across the batch.
According to industry benchmarks, businesses using route optimisation see fuel savings of 20-30%. DHL's Greenplan routing algorithm achieved a 20% reduction in delivery costs. Tesco's AI-powered routing saved 11.2 million miles annually.
For Singapore sellers, the impact is straightforward: if you're paying $15 per single delivery with other platforms, multi-stop pricing at $10 per stop saves you $25 on five orders. That's $500 monthly on 100 orders.
Choose transparent pricing over quoted rates.
Many delivery services advertise low base rates, then add surcharges for CBD pickups, Sentosa drops, weight tiers, and fuel levies. Your $8 delivery becomes $14 after the invoice.
Look for services that show the final price before you book. No callbacks, no quote requests, no surprises two days later.
Transparent pricing also lets you factor delivery costs into your product pricing accurately. If you're offering free delivery above $50, you need to know your actual cost, not an estimate.
BoxPls shows pricing upfront before you confirm. Multi-stop delivery starts from $10 per stop with route optimisation savings passed directly to you. No hidden surcharges for CBD, Tuas, or Sentosa.
