LCP Consulting, a supply chain consultancy, estimates that around 600,000 Christmas presents ordered for home delivery in the UK on Cyber Monday will need to be redelivered. The company also estimates that 30m unwanted presents will be returned over Christmas. The consultancy suggested that next day deliveries will be more prominent this year compared to 2013, as retailers have moved their last order dates further from Christmas.
The high volume of returns and the need to double next day deliveries from December is expected to place additional demands on retailers during their busiest online sales week of the year. A recent LCP report (The Omni-Channel Dilemma) identified the need for retailers to understand where they sit in the marketplace, what they should focus on and the best model for them to adopt. It highlights the area of customer convenience and fulfilment as of critical importance for retail leadership and differentiation.
Stuart Higgins, Retail Partner at LCP Consulting said, “Retailers face a critical choice about where they should focus their investments to ensure success. They may attract customers by managing the front end, particularly during the critical Christmas period – but that is only half the story. How likely will they be to return when the experience doesn’t match the promise?”
LCP Consulting also raised the point that getting refunds back to customers in a timely way and the processes that are associated with these returns will also be a key challenge. Phil Streatfield, Retail Partner at LCP Consulting explained, “Based on these predictions, there will be over £500m of refunds this Christmas – creating more pressure than ever for retailers to be slicker in managing their refund process. This will be a critical factor for future success, and become part of a new and increasingly complex battleground for differentiation.”
“Delivering greater convenience for customers is essential. What makes things more difficult is differing consumer definitions of convenience. For example, what is convenient for a largely home-based customer is markedly different to that for someone working in the city and restricted to office hours. This means that retailers need to create different value equations and service propositions,” he added.
The world's largest collection of global supply chain intelligence