Studies in recent years show parcel delivery has become more important to customers. In fact, poor delivery performance can cost you repeat business, and possibly damage your reputation.
How is it possible to deliver more cost-effectively and responsively? It requires a combination of digitisation and outsourcing, providing greater control and protection.
The first step is understanding your customers and what they expect.
A wide-ranging Capgemini study confirmed how important parcel delivery is becoming for retail business, in particular, finding delivery performance can foster loyalty when done well and drive customers away when it doesn’t meet expectations.
Capgemini said customers who are satisfied with their delivery experience are more likely to increase their purchase levels. In fact, “74% of satisfied consumers intend to increase purchase levels by 12% with their preferred retailer”. It also found 48% of dissatisfied customers intend to stop purchasing from a poor-performing supplier.
The study also found among satisfied customers, 53% would be willing to purchase a paid membership for delivery services.
Yet the prevailing theme was widespread dissatisfaction with last-mile delivery — with high delivery prices, unavailability of same-day delivery, and late deliveries the biggest bug-bears.
The same issues are becoming more pervasive across other industries, including B2B sectors, as people across the board expect greater convenience regarding deliveries. What must smart companies consider so their delivery options match their outstanding face-to-face service?
Can you get by with AusPost or couriers?
Not all businesses can rely on AusPost or couriers to fulfil the delivery role. In fact, in many cases, this could be the worst option. Going cheap can be incredibly costly if an item ends up missing. For example, a courier who leaves an expensive delivery on the front doorstep, which is then stolen, leaving you to pick up the bill for a replacement item.
Any company shipping valuable, bespoke items, fragile items, or products with unusual sizes needs to be careful. Your average courier is not set up to handle this product. Other options may seem more expensive at first, but they may be more reliable and provide better service, building customer loyalty.
Do you want to manage your own fleet?
You could invest in your own fleet, using your own delivery vehicles and drivers, but this is an expensive option with huge fixed costs. It also introduces headaches. Telematics supplier Verizon Connect found the average small-to-medium business faces a £6,000 ($11,000) repair bill each year and five days of vehicle downtime due to road collisions. Plus, more than half (54%) of fleets surveyed experienced an incident in the past year, with a third of respondents saying that maintenance and other associated costs are the top issues keeping them awake at night.
Most companies are better off concentrating on their core business and leaving the fleet management headaches to someone else.
Should you outsource your fleet?
Outsourcing can provide you with more control and the flexibility to start slowly. You may only need one part-time van, and gradually build from there. Finding the right suppliers is the trick. You need a supplier which can grow with you.
Fleet issues can pop up at any time — absentees, vehicle breakdowns and accidents must be well managed. Look for a partner which has the set-up to respond seamlessly.
Finding a reputable supplier can be a challenge, because anyone can buy a couple of vans and call themselves a ‘transport company’. Experience counts. A good supplier will let you take your time over a decision, and let you talk to their other clients. They will be happy to start small and consider a trial period. You need to gauge how responsive they are both day-to-day and when things go wrong, and try to find out whether they will truly treat your business as if it’s their own.
Is digitisation working for you?
Customers love knowing when and where their delivery is. More supply chains are using the Internet of Things to keep clients looped into their deliveries, though it doesn’t always carry through to last-mile delivery and is not always available for smaller companies.
Telematics tracking technology is now accessible to all businesses, which shows customers where their delivery is (saving you time in fielding follow-up enquiries about their delivery status).
Digitisation is powerful at improving efficiency. Tracking technology allows you to understand and plan delivery routes, and prevent drivers from doubling-up, enabling you to achieve more deliveries with the same resources. The same technology can use geo-fencing to alert you when drivers go ‘off-route’ or have an unexpected or prolonged stop.
The technology may also protect your business by providing proof of delivery — this can be important if your company ever faces disputes around missing delivery items. Without some proof of delivery, you are at the mercy of a disorganised client who may accidentally misplace an item and believe it hasn’t been delivered.
Ultimately, any business that asks and answers these questions will be poised to improve customer service and prevent deliveries from eating further into their profit margins.