The retail industry around the globe is in a state of flux. Retailers are trying hard to find a balance between customer expectations and profitability. Is there a way to crack it?
Let’s face it—this is the era of ‘let’s order something and unbox it now’. As a retailer/e-retailer you are now catering to a smartphone-savvy generation that expects orders to have been delivered yesterday. Gone are the days of week-long delivery times.
The new-age customer cannot take delays and certainly not a failed delivery. Ask any customer support agent and they’ll tell you the number of calls/tweets/chats they receive asking for an explanation as to why the delivery cannot be done right in one go.
“I’ll tell you my preferred time slot. Just deliver it, man. Can’t you do this?” #unsubscribe
It is no secret that no brand wants to get in the bad books of a loyal customer. With product selection going online and payment becoming so very simple, the customer experience suffers only in the delivery part of the cycle.
This young demographic is even ready to spend a few extra dollars to ensure a great customer experience.
What ails the retailers?
Being a retailer in today’s age is no easy task. Consumers’ expectations are ever-changing— they want retailers to provide a wide selection, at the best rates, be environmentally conscious, deliver on time, provide attractive discounts and what not!
But, retailers just cannot change so quickly. As they say—change is usually slow and always a work-in-progress. Retailers are still learning how to serve today’s customers and also be profitable.
A major part of this change lies in streamlining the most complex part of their operation—last mile delivery and logistics.
Many are still stuck with manual processes and silos. One part of the logistics operation does not know what the other is doing, thereby leading to a lack of efficiency and oversight. Sometimes, the logistics operations are even outsourced.
Many companies still track their logistics with primitive excel sheets. On top of all this, retailers fail to meet customer delivery expectations, which also means that they are wasting valuable man hours and money on deliveries.
According to a Capgemini Research Institute’s report titled ‘The last-mile delivery challenge’, “A superior last-mile experience engages and retains consumers, with our research showing that three-quarters are willing to spend more if they are satisfied with the delivery services.”
While that sounds like good news, delivery execution is where the problem lies. Catering to the ever-increasing demand is already gnawing at the retailers’ profitability.
“We found that over half of (the) consumers (55%) said that they will switch to a competitor if that competitor offers a faster service. Organizations that provide a superior last-mile experience will gain a competitive edge over their peers,” adds the report.
What does a great last-mile delivery service actually add to a retailer?
- Free word-of-mouth recommendation
- Higher customer retention
- Increase in order size
- Cross-sell and up-sell opportunities
- Higher chances to sell exclusive memberships
Well, well, if you can potentially achieve all this, why not just get the delivery right?
It’s not as easy as it sounds. There are just too many things working against you. From traffic, wrong addresses, vehicle capacity, delivery personnel’s route knowledge, etc. Long list, really!
What if you could get the delivery right, the first time?
FADR to the rescue
Enter FADR or First Attempt Delivery Rate. To put it simply— it is a direct indication of successful deliveries made in the first attempt.
In retail, FADR can reduce costs involved in executing multiple deliveries (for the same order), storage of packages and management of personnel.
With artificial intelligence coming in, it is now certainly possible to collate a large number of data and go about executing deliveries with precision. The end goal is to use tech to make customers happy.
An improved FADR is a win-win situation for the customer, the delivery executive, and the service provider.
How is Locus improving FADR?
Locus’ world-class products help retailers:
- Deliver on customer-preferred time windows and also provide customers with the live ETA of the delivery via a tracking link
- Come up with a dynamic routing platform, that intelligently plans delivery routes by factoring in operational constraints and environmental factors like real-time traffic
- Map any delivery package to the customer with only time of delivery and location
- We also help in:
- Partial pickup and drop
- Assigning on-demand and bulk orders
- Rescheduling and canceling orders on the go
To know more about FADR, watch: How To Increase First Attempt Delivery Rate?