Last Mile Delivery Cost Calculator
Calculate last-mile delivery economics for parcel couriers and local fleets, evaluating driver wages, vehicle depreciation, route fuel, stop density, and delivery failure rates.
Courier Shift & Delivery Density
Cost / Completed Drop
$3.36
Per delivered package
Total Route Cost
$319.00
Driver + Van + Reattempts
Driver Labor Cost
$220.00
With 25% payroll burden
Deliveries Completed
95
5 reattempts required
Last Mile Delivery Cost Formula
Cost Per Delivery = \frac{\text{Driver Labor} + \text{Vehicle Cost} + \text{Dispatch Software} + \text{Failure Re-attempts}}{\text{Completed Deliveries}}- Driver Labor: Shift hours × Hourly wage × (1 + Payroll taxes & benefits burden).
- Vehicle Cost: Daily route mileage × (Fuel per mile + Lease/depreciation + Maintenance).
- Delivery Density: Total completed drops divided by route driving miles.
- Failure Re-attempts: Parcels requiring redelivery due to missing recipients, incorrect addresses, or gated access.
Step-by-Step Worked Example
Calculation Steps:
- Driver Labor Cost = 8.0 × \$22.00 × 1.25 = \$220.00
- Vehicle Cost = 90 miles × \$0.60 = \$54.00
- Dispatch Overhead = \$20.00
- Base Daily Route Cost = \$220 + \$54 + \$20 = \$294.00
- Failed Delivery Re-attempts = 5 × \$5.00 = \$25.00
- Total Daily Route Cost = \$294.00 + \$25.00 = \$319.00
- Cost Per Completed Delivery = \$319.00 / 95 = \$3.36 / delivery
How to Use This Calculator
- 1Enter driver shift hours, hourly base pay, and payroll benefits percentage.
- 2Input daily route driving mileage and vehicle cost per mile.
- 3Enter scheduled package stops and first-attempt delivery success rate.
- 4Review total daily route cost, cost per stop, and delivery failure expenses.
Assumptions & Limitations
- Payroll burden includes FICA taxes, workers’ compensation, and healthcare benefits.
- Failed deliveries incur added sorting and redelivery labor on subsequent cycles.
Frequently Asked Questions
Why is last-mile delivery the most expensive part of the supply chain?
Last-mile delivery represents up to 53% of total shipping costs because vehicles must stop frequently at individual dispersed homes with low drop density, burning fuel in stop-and-go traffic while drivers navigate stairs, gates, and signatures.
What is a good first-attempt delivery success rate?
High-performing commercial parcel fleets achieve 95% to 98% first-attempt delivery success. Rates falling below 90% significantly erode delivery margins due to repeated transit cycles.
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