It’s easy to order your favourite product online these days. At the click of a button, you can buy anything from a mobile phone to a pack of biscuits or a sofa set for your living room. What’s increasingly difficult is getting your products delivered on time, writes Kushal Nahata, CEO and founder of FarEye.
Retailers worldwide are grappling with supply chain issues that result in delayed or unsuccessful deliveries. Only a handful of these enterprises know how to navigate past this turmoil. A BCG report suggests that only 10% of companies are truly prepared for supply chain disruptions.
According to a research report, nearly 24% of retailers claim that more than one in 10 orders aren’t delivered on the first attempt and delivery failures cost retailers an average of $17.20 per order or $197,730 per year. Another study suggests that 85% of consumers will not shop with a retailer again after having a poor delivery experience.
So, why are retailers damaging their reputation and losing customers and money by providing a shabby last mile delivery experience?
Blinded by the lack of last mile delivery visibility
Visibility is at the very core of an effective supply chain management strategy. And it’s here that retailers often stumble. Lack of visibility in the last mile has ramifications that spread far and wide and lead to:
Poor customer experience: When retailers don’t have visibility into their last mile operations, they miss delivery windows which leads to late deliveries and dissatisfied customers.
Increase in costs: Without visibility, retailers will not be able to point out gaps or inefficiencies in their last mile operations. This can increase operational costs. If retailers don’t optimise their delivery routes, they will end up paying higher fuel costs and will take longer to deliver packages.
Inventory challenges: If retailers are unable to track delivery times accurately, it can be challenging to manage inventory levels effectively. Overstocking or understocking products can lead to lost sales or excess inventory costs.
Failure to adapt to customer needs: Customers are increasingly demanding same-day or next-day deliveries. They also want to receive their packages at their convenience. Retailers who lack visibility in their last mile delivery processes will be unable to personalise delivery offerings and give the necessary flexibility to their customers.
Why retailers need robust last mile delivery tracking technology
According to a report by Retail Dive, almost 70% of consumers look at order tracking ability as one of the top three considerations they consider while purchasing products online. To increase visibility, retailers need to urgently embrace last-mile delivery tracking solutions. A Gartner research report says that over 75% of last-mile deliveries to end consumers in North America and Europe will have near-real-time visibility with delivery windows and ETAs.
Last mile tracking can be divided into two categories:
Last mile tracking for the consumer: Once customers place their order online, they get real-time updates on the location of their product.
Tracking for retailers: Last mile tracking gives retailers real-time visibility into their delivery operations.
Last mile tracking for consumers
The ability to track delivery time gives consumers a sense of control over the products they’ve ordered online. Last mile tracking gives online shoppers complete visibility into their delivery. Last mile tracking solutions provide the below-mentioned features to the end consumer:
Last mile tracking technologies keep customers informed about their packages through text alerts. These alerts usually contain the order number, delivery vehicle, and delivery agent’s phone details. It also provides customers with information on the specific time slot they can expect the delivery agent to bring their order.
Real-time vehicle tracking
At a click of a button, customers can access a map, pinpoint the location of their delivery vehicle and get real-time ETAs.
Direct communication with drivers
It provides excellent value addition as consumers can directly communicate with the delivery agents assigned to their orders.
Last mile tracking for retailers
Visibility helps businesses become more customer-centric. Last mile tracking technologies help retailers ensure that the product reaches its destination on time and in proper condition. Last mile tracking solutions provide the below-mentioned advantages for retailers.
Real-time package tracking
Businesses can track the movement of goods from the time it’s loaded onto the truck until the time it safely reaches the customer’s doorstep. It enables retailers to have real-time information on the loading and unloading of packages, on the assigned delivery agents, and how near or far these agents are from the package drop location. This can help in getting accurate ETAs and communicating the same to the end consumer.
Demand planning and forecasting
With visibility into their last mile operations, retailers can better manage inventory levels and ensure that products are available when customers need them. Last mile visibility ensures that retailers can foresee and then adapt to the changes in consumer demand.
Online shoppers have forced enterprises to recalibrate their last mile operations. It’s not just the products, retailers now have to offer a smooth delivery experience to win the trust and loyalty of the end consumer. Enterprises must invest in more visibility into their last mile delivery operations not only to enhance customer experience but also to cut down costs in the long run.
Kushal Nahata, CEO and founder of FarEye