As the old retail adage has it, the customer is king. But today this monarch is becoming increasingly trying, demanding goods to be delivered quicker than ever before, in locations that suit the customer rather than the retailer.
In order to target rising levels of expected convenience, Amazon this week announced plans to roll out a one-hour delivery service across the UK, starting with parts of central London.
In the fashion retail landscape, it’s unlikely that the demand for clothing and footwear will reach this level, although a replacement for a wine-stained shirt at dinner could occasionally come in handy.
However, with a move towards shorter and shorter lead times - House of Fraser recently extended the cut off for next day click-and-collect orders to midnight – stores will be thinking more than ever how they can bridge the gap between demand and what they can realistically offer.
CitySprint is the UK’s largest privately-owned same-day delivery company. Chief executive Patrick Gallagher believes Amazon faces an uphill struggle (or cycle if the delivery staff use the same mode of transport as in the US.)
“In the new retail landscape, customers prize flexibility and ease of delivery above almost all else. If Amazon can get this right others will be forced to follow, but we have seen numerous other companies in the logistics and distribution industry try this kind of service in the past and fail.
“The problems that they encountered are still here today. Namely, the difficulty of stock holding transparency, retailer’s legacy IT systems and most importantly, the mind set of retailers.”
This fast-paced culture has also instilled a degree of fear among retailers and a level of superiority among the shoppers.
Niklas Hedin, chief executive of logistics firm Centiro and Jason Shorrock, senior director of supply chain solutions business JDA agree customers have become less tolerant of order fulfilment failures. This is backed up by recent YouGov research that revealed 71% of UK adults would switch to an alternative retailer as result of a poor online experience.
“Those who are unable to meet customers’ growing delivery requirements risk missed revenues and ultimately damaged loyalty,” said Hedin. “It’s clear that customers have no reservations about taking their business elsewhere if they are not satisfied with the service they receive.”
“Customers today value having choices and options for the delivery of items and are prepared to vote with their feet; speed is not always of the essence,” added Shorrock.
I suggest what the high street needs is a lot less sheep and a few more shepherds. The focus for retailers big and small should be on doing the sums and ensuring operations, whether in store or online, are profitable at any cost (a’la John Lewis’ click-and-collect charges). Overpromising and under-delivering can only result in the customer and the retailer feeling less than satisfied.