Published Online:March 2026
Product Name:The IUP Journal of Supply Chain Management
Product Type:Article
Product Code:IJSCM020326
DOI:10.71329/IUPJSCM/2026.23.1.24-38
Author Name:Prachi Khosla
Availability:YES
Subject/Domain:Strategic
Download Format:PDF
Pages:24-38
This study examines the adoption of artificial intelligence (AI) in last-mile delivery across India’s Tier 2 and Tier 3 cities by identifying key challenges, enabling factors, and implementation constraints. Using a qualitative, descriptive research design, the study synthesizes secondary evidence from peer-reviewed literature, industry reports, and policy documents. A thematic analysis structures the findings across infrastructure, data, organizational, and policy dimensions. Based on this synthesis, the paper develops an AI Readiness Framework for last mile logistics, which explains how these dimensions interact to shape adoption outcomes in emerging urban contexts. The framework highlights critical gaps in infrastructure, data integration, and skills, while identifying digital penetration, platform logistics, and policy support as key enablers for scalable AI adoption.
Last-mile delivery costs in India account for nearly 50% of total shipping expenses, averaging 100 to 200 per urban delivery and 250 to 400 for rural zones (Prasaath, 2025; eShipz, 2025). In response to these high costs, the last-mile delivery landscape in India has evolved significantly in recent years, largely driven by technological advancements incorporating AI.