How retailers can better manage the last mile
Retailers that can deliver and meet local demand faster and more efficiently will thrive.
The landscape of retail has changed dramatically in the last 15 years, where added services such as deliveries are no longer a differentiator, but a prerequisite. We now live in a world where individuals have the ability to access data about one’s products and store before even stepping inside.
The landscape has also shifted dramatically as far as priorities. Platforms such third-party demand generators and social media are receiving more attention than ever before. That’s why it’s important for a retailer to keep up with the conversation, and most importantly, be aware of what’s going on in the market.
Retailers that can deliver and meet local demand faster and more efficiently will thrive. Depending on the neighborhood, the concept of convenience can be very important to a buyer. A lot of people will buy from their local grocery store because it’s a few blocks away, rather than traveling miles to a larger or cheaper shop. This is typically the case in a metropolitan city. In a suburban neighborhood, shopping around for the best deal would not necessarily be deterred by distance, as people are prone to driving; however, some customers would prefer to not shop at all and have the ability to access products from their couch.
Delivering product with the click of a button leads to reaching more customers, creating a higher rate of customer loyalty and generating more business. Delivery services are really an incredible mechanism for retailers to grow.
Key issues impacting retailers
Most stores have employees who do more than their job description, especially in high-volume shops where workers are likely to also run out for deliveries. It can be an overwhelming experience.
Likewise, the delivery guy might not be the most reliable employee. Delivery workers stay at a retailer anywhere between 3-6 months before they leave or are fired. This becomes more difficult when a retailer might have 35% of sales come through delivery, making those workers more valuable than some of the sales associates.
Enough delivery workers need to be available and properly managed, which can be difficult in bad weather. Delivery workers that don’t show up to work because they are sick or having trouble getting to work in bad weather hurts a retailer because the delivery times will take longer.
Retailers using a third-party platform might feel pressure to get deliveries to their customers in 40 minutes or less. Deliveries through a third-party platform can be addicting because stores receive additional revenue; however, those customers belong to the platform. If that platform raised its costs or kicks you off the platform altogether, those customers are unlikely to continue shopping with you.
Store owners entered the industry to sell what they are passionate about. When deliveries become a big priority in one’s business model, retailers need to become dispatchers and track those workers. Some store owners are unaware if a delivery worker runs personal errands on the company’s time. Delivery workers are also unsure if or how they will be tipped, so there isn’t an incentive to really hustle on deliveries.
Third-party platform provides efficient, reliable solution
With cost, liability, efficient employees, time commitment and pressure from third-party platforms acting as deterrents, companies are thinking twice about offering delivery services. There is a solution though—a third-party platform that arranges contract workers to pick up products at a cheaper rate than an in-house employee, and that are well equipped to get those deliveries done.
Third-party platforms offer retailers the ability to find a local courier in the area to do deliveries for businesses. The open-market platform allows businesses to create minimum bids on their deliveries, with delivery partners choosing to take on that task. It gives the business ample area workers to run deliveries and potentially drive down the price. The app gives retailers the ability to track the delivery worker through the process, along with the ability to message and call if necessary.
Retailers only pay for the delivery rather than the delivery and return, which saves store owners money, and gives retailers peace of mind to click a button and let the deliveries happen without much thought.