The supply chain pitfalls of e-commerce

Neil Cotty, Global Freight Solutions 2 January 2014 | Neil Cotty

Every business strives to ensure exceptional management of its supply chain.

However, the management of delivery problems or ‘exceptions’ is especially critical to retailers. As retail is an industry that places a premium on maintaining a positive customer experience, increased sales to consumers at home present a greater challenge at a time when volumes may surge many times above their pre-peak levels.

The effort required to maintain detailed oversight is magnified given the wide array of delivery methods - including carriers, parcel shops and locker terminals as well as retailers’ own ‘click and collect’ store estates – which need to be put in place because shoppers are ever more demanding in how they want to receive purchases.

Trying to keep track of large numbers of items being moved in a variety of ways increases the management effort. Furthermore, it can often be difficult for those more used to selling than shipping to quickly identify a handful of exceptions amongst many thousands of deliveries still in transit.

For retailers who both rely on the internet for sales, and are at the mercy of social media when things go wrong, there is considerable risk. One consumer’s bad experience can quickly be shared with many others, damaging reputations and leading to custom being taken elsewhere. Often, this can be the result of failure on a single delivery alone.

On many occasions, it is only during peak periods that retailers realise how much time and energy they expend overseeing their deliveries. Even so, just as technology has made the process of buying online smarter via smartphones and tablets, retailers are getting smarter too.

Consumers’ needs are quite simple when ordering online. They want their delivery at a time and a place most convenient to them. For example, being provided with the capability to choose the date, time and method of delivery is a critical factor in ensuring the online shopping cart is not abandoned in favour of a retailer offering greater choice.

Unfortunately, while this may be a basic requirement of the consumer, implementing this at the online checkout and in a retailer’s warehouse at the time of order fulfilment is not so straightforward and requires specialist software to bring about.

Even after being provided with the delivery options to best fit a consumer’s needs, exceptions can, sadly, occur. When a carrier cannot deliver on its promise on behalf of the retailer, addressing any issues quickly and pro-actively is key to maintaining a high quality customer experience.

Even if an individual issue cannot be corrected, retailers know that explaining what has happened to a customer – and, critically, how the matter will be resolved - rather than causing them to wait in all day for a delivery which is not going to arrive, can mean the difference between repeat business or not.

There is nothing worse for a retailer than being contacted by a customer over a failed delivery rather than being able to get in touch with that consumer first to advise of the situation and what is being done to resolve it.

Neil Cotty is managing director of Global Freight Solutions

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