With delivery costs spiralling upwards, a lack of visibility into operations, and increasing customer expectations, it is no wonder that retailers feel their delivery operations are out of control.
Today, about 25% of all retail purchases are made online and this number is expected to increase to a full one third of all transactions by 2026. Add on to that today’s inflationary concerns, supply chain disruptions and labor shortages – and we have a situation that is pushing up costs and lowering profit margins.
This has resulted in an online marketplace where competition is increasing while consumers are tightening up their digital wallets. Retailers that want to compete in this environment need the advantages offered by a Delivery Management Platform (DMP) to bring together all rogue elements of the last mile delivery process, but most importantly to cut costs, increase efficiency and provide a superior customer experience.
Many retailers have already made the move to a DMP as it is proving essential for staying competitive in both the short and long term.
Increased Flexibility and Efficiency
Two primary goals in retail delivery are:
- Ensuring products arrive on-time to their destination
- Deploying the most cost-effective delivery methods
The right DMP will have the ability to deliver on both these essential operations by offering access to both internal fleets and external carriers. This takes care of both finding the resources to make delivery deadlines on one hand, while assessing the most cost-effective way to deliver each package on the other.
Many retailers want to have the capacity to be flexible when assigning delivery routes on a demand-driven basis. For example, designating deliveries to internal drivers until there is no more capacity and then automatically assigning additional orders to a third-party fleet at peak times of the day or during peak season.
With supply chain challenges and driver shortages constantly arising, making timely deliveries becomes an increasingly challenging task. A proven approach to overcoming this challenge is having access and full control of an unlimited network of delivery providers that can be assigned according to delivery demand.
The flexible option for using external delivery service providers via the same DMP is more critical than ever before, particularly as we are seeing leading retailers with their own internal fleets, such as Domino’s Pizza, scramble to find drivers and increase delivery prices to offer better wages for them.
To stay competitive, providing a superior customer experience must be done in the most cost-effective way possible.
Many retailers want the option of assigning delivery routes on a demand-driven basis, such as automatically assigning additional orders to a third party fleet at peak times of the day or during peak season.
Another example is product returns, where internal drivers might have reached capacity with deliveries and third parties might be suddenly required to efficiently handle product returns. A centralized DMP can offer complete visibility into fleet capacity, delivery vs returns, allowing you to even automate which service gets assigned to which provider.
Enhanced Management and Customer Satisfaction
A DMP can provide retailers with access to leading 3PLs that can quickly expand their last mile delivery operations. Integration with third parties is key to providing real-time data updates that enable true visibility and orchestration, which in turn will help control all aspects of the customer journey – from purchase to home delivery.
Management capabilities are further enhanced via a DMP through integration with eCommerce, inventory and financial systems. Access to internal drivers and carriers, enables flexible scheduling and route optimization to provide the best possible delivery experience at the lowest possible price.
Finding the best delivery route results in more orders delivered in less time, using fewer resources and less fuel. Optimizing route planning is a benefit of deploying a DMP and an important part of improving delivery efficiency.
86% of consumers won’t return after two poor experiences. It’s a no-brainer that the key for any retailer to survive in today’s climate is rooted in customer satisfaction. A properly integrated DMP will provide real-time alerts that not only keep internal staff and third party providers in control but – more importantly – allow customers to be updated about the status of the delivery in real time.
Reverse logistics is another great example of where DMPs are fast proving essential for improving the customer experience. Used mainly in the case of product returns, reverse logistics is the opposite of the normal delivery flow, enabling customers to easily ship their returns back to the retailer. Ensuring a positive return experience goes a long way towards building customer loyalty and getting repeat business.
AI Based Analytics and Decision-Making
Retailers must rethink customer interactions, not only as a way to sell products, but also as a gold mine for data that can improve operations and customer experience. The problem is not collecting the data, but how to provide meaningful analytics that translate into changes that result in more revenue and better customer service.
One of the biggest advantages of a DMP is the ability to leverage AI and machine learning technology to provide meaningful and actionable insights based on historical data. This information can then be used to make key decisions regarding lowering costs, increasing margins, predicting seasonal demand, managing supply chain and identifying anomalies – just to name a few.