Last mile efficiency is the key to free delivery

 

Last mile efficiency is the key to free delivery

April 25, 2019

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By Patrick McGuirk, Commercial Director of PostTag

Picture this. You’ve been shopping online, filling your basket with items, but when you get to the checkout suddenly £10 is slapped on for postage. Are you going to fork out the extra cost or close the browser and shop elsewhere?

Gone are the days when time-poor people were happy to pay for the convenience of online shopping and expect to receive it in five to seven days. Amazon changed the game and consumer mindset seven years ago when it launched free delivery and next day service – pushing other retailers into a corner because, of course, delivery isn’t free. The cost must be picked up by someone, but businesses can’t afford to lump it on shoppers. Those companies who have grown up online and built efficient ecomm supply chains are the ones surviving. 

Should companies up the prices to cover the cost of delivery? Fine for fridges but maybe not fridge magnets. Should they squeeze suppliers? Not an option in the age of ethical consumerism. Maybe they should balance the books with a subscription service. Great for Amazon and Netflix but impossible for SMEs.

The best way for all and any business to save on delivery costs is to perfect the process by improving efficiency from the second an order is placed until it’s delivered to the door – but it’s this final stretch that is causing pain for drivers around the world.

Deficient destination data has long been an achilles heel for the delivery industry as standard navigation systems continue to fail drivers already under pressure. Our analysis of over half a million homes in the UK shows that drivers are wasting almost half an hour every day searching for the right house because 45% of addresses are off the mark by more than 50 metres. Multiple this by the hundreds of thousands of deliveries made and miles covered each day and the numbers really start to add up.

Our game-changing technology will give drivers the precise address data before they get behind the wheel to make sure they get to the right front door first time. This will ease the stress on delivery infrastructure – already at breaking point – and result in significant savings.

 “Free delivery” is now expected by every customer. This won’t change and swallowing costs without improving driver efficiency is unsustainable. Correcting destination data will drive performance and give companies a clear advantage over the competition.