Online retailers and courier services need to brace themselves for the fast rise of same day and next day courier services.
Modern consumers are growing increasingly accustomed to the instant gratification of their needs and wants, and are empowered by social media to call out companies that do not meet their expectations.
PwC found that 10% of online customers want their goods on the same day, but only 41% are willing to pay for the privilege. It’s estimated that this trend will continue on an upwards trajectory.
Meeting these demands for same day and next day courier deliveries puts a great deal of strain on businesses. If they fail to contend in this area, however, they risk falling out of the competitive running altogether.
With last-mile expenses averaging at 50% of the total delivery cost, how can online retailers and next day courier service providers meet demands without shouldering immense costs?
Click and Collect
One simple solution is to cut out door-to-door delivery altogether.
Click and collect services from brick-and-mortar stores are proving very popular. By delivering goods for multiple customers to one destination, delivery costs can be reduced for both the business and the customers.
It also offers more flexibility for customers who can’t be at home to wait for their deliveries. The speed at which items can be delivered to click and collect locations is much quicker than travelling to multiple homes.
Currently, many retailers are footing the brunt of the delivery cost for same and next day delivery, to the detriment of their profit margins. By rolling out wider click and collect services, they can eliminate the majority of last-mile delivery costs, boosting their profits but still meeting customer demand for swift speeds.
Amazon have notably instated their own click and collect service in the form of Amazon Lockers. Customers select a locker in a location of their choice for their item to be delivered to and they can collect it with a unique pickup code. This way, customers will never miss a delivery and their parcels will be safe, secure, and on time.
To facilitate click and collect services, retailers must of course have a vast range of products available in different geographic locations to reduce the added costs of transporting goods between facilities. In other words, unless you are part of a larger network — retailers must be of a certain size.
Same and next day courier delivery services have seen a massive boost in efficiency and profitability by using data-driven software solutions.
Investing in software that automates and regulates steps in the delivery process will ultimately save businesses a significant amount of money, therefore allowing them to reduce their delivery costs for customers.
Software can carry out processes like:
- Crawling websites for important information e.g. inventory levels
- Handling purchases and invoices
- Carrying out automated e-mail communication with customers
- Delivery route optimisation
Using technology in place of humans reduces costly and time-consuming errors in data entry and reduces payroll costs. Whilst a costly initial investment, companies who employ it often see a payoff in just a few months.
Flexible Courier Services
Companies like Amazon are deterring from reliance on traditional courier services, rolling out new schemes like Amazon Flex.
Ordinary drivers can use an app to sign up to do shifts to deliver Amazon packages to customers’ doors from small warehouses. They are paid around $18-25 an hour but they have less control over their schedule and they have to pay their own insurance and petrol costs because they’re technically contractors.
These flexible courier services boost delivery speeds significantly because they can quickly recruit more drivers during peak periods. Recruiting ‘gig’ workers reduces some of the overheads involved in maintaining a regular, permanent workforce, thus reducing delivery costs.
Looking For An Overnight Delivery Service?
Caledonian Courier Company have been in operation since 1994, run by individuals with over 50 years experience in courier services. Over the years, we have refined our expertise, providing speedy and efficient delivery services.