This time last year we reported on some of the trends and challenges for online retailers, in managing their deliveries over Black Friday, Cyber Monday and into the Christmas period.
Black Friday this year falls on 25th November and, from there on in, the retail sector has well and truly hit its busiest time of the year. As with 2015, predictions for online sales volumes in these last few months of the year look set to skyrocket: As far back as May, reports predicted a total spend between Black Friday and Cyber Monday of over £5bn in the UK alone.
The key black Friday and cyber Monday challenges for UK retailers in 2016:
The UK driver shortage
One of the key challenges we reported in 2015, was the skill shortage in the UK truck driver industry. Last year, the Road Haulage Association (RHA) warned that a shortage of truck drivers could potentially lead to empty shelves come Christmas, with 85% of goods purchased in the UK carried by truck at some stage in the supply chain, and estimated the shortage to be between 45,000 and 50,000 drivers.
So, how is the situation looking this year?
Well, the RHA reported on huge successes during Lorry Week 2016’s ‘Next Generation’ activities, and reported that “younger people are starting to see haulage as an industry in which they can build a career.” It looks like the driver workforce is beginning to attract a new talent pool, but we’re not there yet: the Freight Transport Association (FTA) warned after their 2016 Skills Summit that “we are currently around 45,000 drivers short”.
What can I do to meet the challenge?
Retailers need to ensure they have enough drivers in place to cover the busiest delivery period of the year, as well as a great Transport Management System (TMS) to streamline the delivery process and save drivers’ time on the road, meaning more deliveries can be made, in less time:
- STREAM’s automated load planning and map-based route-optimisation makes the most efficient use of vehicle space and matches up the fastest routes.
- Proactive SMS and Email updates to customers vastly reduce the likelihood of customers missing their delivery slot altogether, cutting out time wasted waiting for customers, and redelivering orders
- Features of the driver mobile app, like daily walkaround checks and electronic proof of delivery, eliminate paperwork and cut back-office admin time
Variation in demand
The variables impacting on the size and scale of events like Black Friday and Cyber Monday are innumerable. Last year, many observers predicted that, though order volumes generally would be high, they wouldn’t reach the peaks of 2014.
SO, HOW IS THE SITUATION LOOKING THIS YEAR?
With total retail sales this year up, month-on-month, from 2015, and predictions that this black Friday and Cyber Monday weekend could see the “First ever £5 billion shopping week in the UK”, according to Salmon, peaks are likely to beat 2015 – not least because retailers are, reportedly, better prepared than last year.
What can I do to meet the challenge?
The key piece of advice for online retailers dealing with a variation in demand over Black Friday and Cyber Monday? Offer discounts over a longer period of time. In this video IMRG, the independent voice of the online retail industry, anticipates an expansion of Black Friday to a five-day period between Thursday 24th and Monday 28th November, and recommends retailers see the weekend as a launch into those high-volume Christmas sales.
Next day delivery isn’t always possible, and delivery promises must reflect that
Last year, we reported that particularly in the run-up to Christmas, retailers will find it harder and harder to rise to the challenge of a blanket next-day delivery policy. As sales order volumes grow, not just because of the Christmas rush, but as online and mobile command a bigger-than-ever share of UK sales.
So, how is the situation looking this year?
It is easy to see that online retailers experiencing higher-than-ever order volumes in the run-up to Christmas, means that providing next-day delivery will be more challenging than ever. Last year, IMRG suggested that ‘many consumers will be happy to opt for longer delivery lead times in order to get the discounts they want’, but for this year customer expectations may have changed. For the first time in 2016, “more shoppers are opting for next-day delivery than economy”: many consumers now see next-day delivery as a standard, not a luxury.
What can I do to meet the challenge?
There are a few options for online retailers to deal with the increasing demand for next-day delivery over Black Friday, Cyber Monday, and during the busy run-up to Christmas:
- Don’t Guarantee next-day delivery if you’re not certain you can meet that promise. A report from MetaPack actually argues that precise delivery is more essential than next-day delivery. Using STREAM to manage delivery routes and keep customers up-to-date, means that customer satisfaction is high: they know exactly when their item will be delivered, cutting out the disappointment of vague, over-promised-and-under-delivered, delivery offers
- Offer next-day delivery as an add-on, at a higher price-point or for loyal customers. Though many customers do now see next-day delivery as a standard, this does not apply across all industries, and many consumers looking for deals are likely to opt for a free or discounted delivery, with a longer lead-time. With STREAM you can add the essential (i.e. next-day) deliveries to a run, before adding other drops that are on, or near, the route, to easily manage differences in guaranteed delivery options.
- If you DO offer next day delivery across the board, be well-prepared.. Make sure you have a strong, dynamic TMS in place, integrated with your order management system, to ensure a slick order-to-delivery process, and satisfied customers.
