Online shoppers keep expecting goods to arrive faster and faster. It’s no longer enough to offer two-day shipping — for many buyers, this needs to be the norm. And increasingly, free shipping isn’t a desirable perk — it’s the industry standard. Amazon Prime is no longer an exception. It’s the rule.
Businesses who sell products online (which includes nearly all businesses in this day and age) need to speed up every part of operations, from warehousing to last-mile delivery, to keep up with these shrinking delivery timelines.
That means as soon as they receive an order, e-commerce retailers need to ping a warehouse. Assuming the item is in stock, warehouse workers need to be able to pull the item, pack it, and prepare it to be shipped. Depending on the speed of service and the parcel carrier, that could be within the hour, or it could be days in the future.
From there, delivery service is in the carrier’s hands. The U.S.’s major parcel carriers move packages across their networks pretty efficiently, moving them on closely monitored timelines from one fulfillment center to another. The most difficult part of their process is the last mile, or getting the package to the customer’s doorstep. For that reason, UPS and FedEx are both beginning to offer more and more pick-up-in-store options with local partners, which allows them to move more volume at greater density. Other carriers, including Amazon, are building or relying on existing third-party courier services to cover the last mile in a timely way.
What can you do to stay ahead of consumer expectations? Compete with Amazon in every aspect of your shipping offerings.
Offer Same-Day, Next-Day and Two-Day Delivery
Amazon Prime made two-day delivery commonplace years ago, and now that the service has around 100 million members, this level of service has been thoroughly normalized. Make sure your company offers two-day shipping at a minimum.
Increasingly, customers are asking for next-day delivery. Prime may seek to make that their new standard for delivery time. In many areas, customers are more and more likely to expect same-day delivery.
For now, online shoppers are still willing to pay a delivery fee for same- and next-day shipping. These are levels of service we still recognize as special. But that may not last much longer.
Offer Customers as Much Information as Possible
It’s easy to understand why “two-day delivery” is preferable to “3-5 day delivery,” even though that one extra day may not make much of a difference: predictability. Often, it’s not exactly that customers require quick delivery service. They simply like the knowledge that, if today is Tuesday, their order will arrive on Thursday.
For that reason, online retailers must offer customers the ability to track their delivery orders. Offering updates via email or text message can provide an added layer of customer comfort. That way, if anything changes, you can inform them directly.
Usually, carriers will offer package tracking as part of their services. Make sure your carrier includes tracking as part of your contract.
Offer Multiple Delivery Options
Sometimes, home delivery isn’t the most convenient choice for a customer. They may prefer to pick an order up from a secure location or a site close to their office.
Carriers already offer delivery to partners with thousands of retail locations. FedEx, for example, will leave packages at FedEx Office, Dollar General, Walgreens, Albertsons and Kroger locations in many zip codes. The U.S. Postal Service, which serves every zip code, will hold packages at post offices rather than sending them out for delivery.
The key with these services is giving customers the ability to select the pick-up experience they want. They should also be able to change their selection if their schedules or needs change. Allowing customers this kind of flexibility makes them feel like they’re in control of their deliveries and can make them as convenient as possible.
The good news is that carriers like these types of deliveries, too. It’s much cheaper for FedEx to deliver five parcels each to five local partner locations than to deliver them to 25 storefronts. It’s in the carrier’s interest to encourage this type of service. If more and more of your shipments end up at these central locations, you may be able to work that information into a future contract negotiation.
Make Internal Communication as Efficient as Possible
Within your company, you can do a great deal to improve supply chain operations. Monitor your vendors’ performance to make sure they’re producing the inventory levels you need at the quality you desire. When possible, standardize your tools and processes across your supply chain, so that multiple employees in multiple locations can share responsibilities. “Supply chain visibility” describes how much information supply chain partners have about each other — and generally speaking, the more, the better.
Logistics technology has improved drastically in recent years, making supply chain visibility a much less daunting goal. Scheduling tools can help you plan for forthcoming inventory spikes and product rollouts. Data gathering and analysis can help you gather information about every package you ship and review it en masse, revealing inefficiencies and allowing you to draw conclusions about trends. (If you want help incorporating data gathering and analysis into your supply chain management, reach out to Reveel. This is what we love to do).
Additionally, work closely with your carrier to make sure they’re offering the service levels your customers demand at a reasonable price. Hold them accountable by auditing your invoices to make sure deliveries are completed accurately and on time. When they aren’t, ask for refunds, and see if you can use those savings to repair relationships with your customers.
Prioritize Customer Satisfaction
Finally, do all of this with your customers in mind. Gather as much data as you can about customer orders at the package level. This helps you draw conclusions about what your customers want, but it also helps you ensure they’re getting their packages efficiently and accurately.
Take advantage of services your carrier offers, like package tracking and drop-offs at brick-and-mortar stores, if your customers find them valuable. At the same time, double-check your carrier’s work by auditing your invoices and use your data to identify potential opportunities for savings.
Customers want faster delivery, yes. But more than that, they want delivery service that empowers them to make decisions that are convenient and useful for them. If you can offer those options and fulfill orders accurately, you’re likely to have happy — and hopefully repeat — customers.
The Reveel App uses AI and machine learning to provide an unparalleled look into what’s impacting your bottom line. Through invoice audits, peer benchmarking, and rate modeling/simulations, you can see the health of your operation and assess pricing changes from parcel carriers like FedEx and UPS. Sign up for a free Reveel account today to see how you can leverage automation to synthesize your data, ship more for less, and reduce the time needed to identify issues and action items.