Last mile problems: The last mile is the hardest

Friday, July 2, 2021 by Louie Bacaj

Pareto distributions abound when discussing the last mile. Last mile problems are those where 20% of our work will yield 80% of the results. Then we need to spend 80% of our time on that last 20%, the last mile problem.

We can only pick a few last mile problems to try and master in one lifetime. Because they are so hard.

I spent more than half a decade building and growing from zero to a billion in sales in eCommerce. The last mile is make or break for eCommerce, an industry with razor-thin margins.

This is why Amazon started competing with FedEx and UPS and set up their own prime trucks. That problem is so damn hard and costs so damn much. The costs of delivering things from warehouses to people's homes are much higher than the cost of getting things to the warehouse, the last mile. Because of the last mile and because Amazon has exhausted the whole 80% of things to solve it now needs to focus on the remaining 20%, they will spend the entire remainder of their life solving the last mile.

The last mile is tough for food too. It's why Doordash is worth over 50 billion dollars. Getting food from restaurants to people's homes isn't just a job that can be solved by high school seniors looking to make a few extra bucks on their nights and weekends anymore. There goes my childhood pizza delivery job.

The last mile is hard for physical fitness too. We spend the first few months and years getting strong quickly; then we can spend our whole life on incremental gains.

It holds for products we build as well. During graduate school, the Google guys built Google, then spent 80% of their time building the other 20%. Sure it's been "optimized" since then, but so what? That last mile is a long one.

But just because the last mile is so hard, it doesn't mean it's not worth tackling. Solving hard problems can put us in the top 99%, rather than the top 80%.

Although that gap is only 19%, it could take others a lifetime to catch up.