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Operations & Logistics: Delivering on the promise

RetailX research reveals retailers cutting the cost of delivery, yet also reducing their offers around collection and returns.

Almost half of all RXEU Top500 retailers now offer shoppers free delivery when they spend over a set amount, yet the proportion offering multichannel click and collect and return-to- store services has fallen significantly since last year, the latest RetailX research has found.

Researchers analysed the fulfilment promises that retailers delivering to the European Economic Area (EEA) make to customers. They focused in particular on what promises retailers make around delivery, collection and returns, including whether they offer these services for free, and, to what extent promises and the rate of change varies across different markets within the EEA.

How much do retailers charge for delivery?

Almost half (48%) of retailers selling in the EEA offer free delivery to shoppers who spend a minimum amount – the median minimum spend across the region being €50. That rises to €58 in Switzerland, €53 in Denmark and Finland, €52 in the UK and €51 in France. The lowest median minimum spend is €30 in Bulgaria, €35 in Poland, €38 in Norway and €39 in Czechia, Lithuania and Estonia.

Some 10% of EEA retailers offer free delivery in 2019, regardless of how much shoppers spend. Free delivery is more common among retailers delivering in the Benelux region (Luxembourg 16%, Netherlands 14%, Belgium 12%) as well as in Cyprus (14%), the UK (13%) and Italy (13%). It is least commonly found in Croatia (5%), Latvia (4%) and Iceland (0%).

How many retailers offer collection – and how much do they charge?

It’s notable that fewer retailers selling to the EEA offer click and collect services in 2019 than did in 2018. Last year, 63% of the Top500 offered the service, enabling shoppers to pick up their online orders in store. That’s fallen to 50% this year, among traders researched in both periods.

The use of click and collect fell across all markets but most sharply in Germany. In 2018, more than half (56%) of all retailers selling to Germany offered the service. That fell by 15 percentage points (pp) in 2019, where the rate dropped from 56% in 2018 to 41% in 2019.

Use of the service also fell significantly in the Netherlands, by 14pp from 63% to 49%, and Ireland (-13pp from 43% to 30%). While all regions saw the use of click and collect fall, Bulgaria (-1pp, 25% to 24%), Slovenia (-2pp, 16% to 14%) and Hungary (-2pp, 38% to 36%) saw the smallest declines.

Of those Top500 retailers that offer click and collect in 2019, more than half (58%) offer it for free. That rises to 75% in Ireland – where the remaining 24% charge an average of €5.97 for collection, the fifth-most expensive average collection cost. Perhaps retailers here have decided that it’s not currently economically viable for them to offer the service, or perhaps they are seeing relatively low levels of demand for it.

More than two thirds (68%) of Spanish retailers offer the service for free, with those that don’t charging an average €4.58. No retailers in Malta, Slovenia or Iceland offer the service for free, where the average collection cost is, respectively, €4.11, €3.67 and €3.64.

How do traders enable shoppers to return unwanted items?

The number of retailers allowing items ordered online to be returned to their stores or by post has fallen since 2018, while services including pick up from the house, prepaid returns, and return to a third-party store remain similar.

Those offering returns by post to customers across the EEA countries fell by 9pp from 83% in 2018 to 74% in 2019, when change was calculated from the 483 retailers measured in both periods.

The fall was sharpest in Finland at -18pp, from 91% to 73% of the 39 traders measured in both periods, followed by Ireland (-16pp, from 83% to 67%, 55 retailers) and Estonia (-15pp, from 90% to 75%, 18 retailers).

The ability to return an item ordered online to the store also fell significantly, by 10pp from 61% to 51% of 483 EEA retailers. The rate fell in all areas of the EEA, but most markedly in Lithuania (-17pp, from 75% 2018 to 58% 2019, 17 retailers) followed by Slovenia (-11pp, 58% to 47%, 17 retailers) and Italy (-11pp, 50% to 39%, 117 retailers).

But the deployment of relatively generous promises, including prepaid returns, returns to third-party stores and returns via couriers, changed relatively little. Slightly more EEA retailers (2pp from 27% to 29% of 483 retailers) now offer prepaid returns, with faster uptake in Bulgaria (+14pp, 21% to 35% of 27 retailers), the UK (+9pp, 22% to 31%, 250 retailers), and Romania (+7pp, 27% to 34%, 29 retailers).

Returns to third-party stores also stayed broadly unchanged, falling by 1pp from 21% to 20% of 483 retailers. The level of change is greater in Austria (+9pp, 8% to 17%, 82 retailers), Poland (+9 pp, 7% to 16%, 91 retailers) and France (+7pp, 17% to 24%, 182 retailers), yet broadly similar in Hungary (-2pp, 6% to 4%, 41 retailers) and Slovakia (-1pp, 9% to 8%, 36 retailers).

Pick up from the house has also stayed steady across the EEA (+1pp 16% to 17% of 483 retailers). The markets that has seen the greatest take-up of the service over the last year include Estonia (+8 pp, 19% to 27%,17 retailers), Slovakia (+8 pp, 14% to 22%, 37 retailers), and Czechia (+6pp, 16% to 22%, 60 retailers).

Case Study:

Darty: fast and convenient delivery and collection

French home electricals business Darty stands out in RetailX research for its promises of fast and convenient delivery and collection. The retailer flags up free delivery and one-hour collection on its home page before spelling out its services in more detail on its services page. Simple delivery is offered on all products weighing up to 30kg, as well as televisions up to 55 inches.

Shoppers can take delivery on the same day that they place the order, in as little as two hours. And while delivery costs start from €12.99, they’re free for those with a Darty+ membership card – which offers unlimited mileage.

Those opting to collect from one of the retailer’s more than 200 stores can do so in as a little as one hour, when the item is in stock or, if it isn’t, in between two and three days. Shoppers can avoid in-store queues by picking up their item from a dedicated click-and-collect desk.

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