The rapid growth in the volume of online sales has forced a rethink of the B2C last mile delivery model. Home delivery is expensive for retailers and parcels companies; sometimes inconvenient for shoppers as well as being a headache for administrators and regulators concerned about levels of traffic and pollution caused by the soaring number of delivery vans. The combination of these factors has prompted many companies involved in the e-retail sector to look for alternative delivery solutions.
Many of these solutions involve alternative delivery addresses or locations such as, for example, collection points, lockers, parcels shops and even ‘in-car’ or ‘in-house’ delivery. According to a survey by UPS, 41% of customers have had their orders delivered to an alternative delivery location and, amongst those who had returned an online purchase, 28% had taken their returns to carrier authorised retail stores. A quarter of customers had used a ‘ship-to-store’ option (i.e. click and collect). The survey also found that 63% of customers in Europe, 52% in USA and 71% in Asia were interested in shipping to alternative delivery locations with extended hours for a reduced fee.
The range of delivery options are also critical in consumer-choice and it has been recognized that delivery location options are important in terms of preventing lost sales as well as speed and cost.
In research undertaken for Ti’s latest report, Global Express & Small Parcels 2019, seven categories of Alternative Delivery Network were identified:
Other alternative delivery network findings in Global Express & Small Parcels 2019
Ti’s Global Express & Small Parcels 2019 report finds that the development of alternative delivery solutions has strategic implications in the trade-off between inventory management and product availability as many retailers are converging their online and offline offering into an ‘online-to-offline’ (O2O) approach to combine the benefits of open-all-hours e-retail with a physical presence, close and convenient to the customer. Moreover, while such networks should bring environmental benefits, the location of the boxes and the operating environment (rural, semi-rural, suburban, inner-city) are the critical factors in the efficiency and sustainability of alternative delivery systems.
Source: Transport Intelligence, October 10, 2019
Author: Transport Intelligence