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Jingle sells

Etailers are looking again at their logistics after being caught off-guard last Christmas when shoppers placed an avalanche of late orders which could not be delivered in time

Aside from the obvious risk of disappointed customers and damage to brand perception, the failure by online retailers to get orders processed, despatched and delivered on time can have disastrous consequences. Complaints, compensation and potential damage to repeat business wield a mighty threat if expected standards are not met. Additionally, customer concerns over late deliveries and items being out of stock can also affect sales.

Based on data from last Christmas, customers want to shop later, with the expectation of swift, problem-free delivery. However, stress peaks in the system regularly put pressure on the delivery network which when running at maximum capacity can lead to the system faltering.As a single-channel business, delivery is a year-round focus for designer womenswear etailer Founder and chief executive Sarah Curran explains: “The benefit of shopping online is being able to receive your purchase as soon as possible, so fulfillment on time is extremely important.

“A reliable delivery prior to Christmas can make or break a consumer’s confidence in online retail. Should an etailer not deliver an expected gift that is bought by a customer for a friend or loved one, their disappointment and resulting lack of trust could mean they will not return to purchase again. “As is always the way with Christmas, retailers can only assume that many customers will purchase gifts up until the last minute. Online retailers have the benefit of being open for trading 24/7 versus high street retailers, who will organise dedicated late-night shopping events. So the only thing we can do as an etailer is to ensure that our logistics side of the business is fully prepared for Christmas trading. This year, Christmas Eve falls on a Thursday, so we will look to deliver up to 12 noon on Christmas Eve.”

Colette Wilson, ecommerce development manager for department store chain House of Fraser, explains that customers are clued up on HoF’s service level agreement (meaning 98% of items are delivered or attempted to be delivered within the promised timeframe) and would therefore be “unforgiving of any peak slip-ups, despite the massive increase in activity over Christmas.” HoF will work with its third-party logistics company, iForce, which uses an ‘intelligent routing system’ to manage a range of carriers. “We work with iForce to maintain the quality of service, especially when other major players are pressing the same distributors to prioritise them.”

iForce will also provide HoF with an order volume forecast by day for peak periods, and by hour for key dates. In terms of settling on a guaranteed-delivery cut-off point for orders, John Owen, general manager of ecommerce at logistics firm DHL, says: “Retailers should have a realistic cut-off date with space for contingency. In my experience, those who choose a realistic rather than optimistic date perform much better. “Every customer wants to be certain that their order will be delivered within their expectations, particularly at Christmas, and particularly if children and gifts are involved. This year, the cut-off date should be around December 18-19, possibly stretching to December 20 at the latest.”

Clipper Logistics Group, whose clients include Littlewoods Direct, Urban Outfitters and Principles, specialises in picking and packing fashion product from central fulfilment centres and filtering it into specific delivery streams. Its director Sean Fahey says that the more information the company can get at the point of order, the more efficient it can make its processes. “For instance, if we can have information in a format we can filter, the more we can prioritise certain orders. A single item order, say, could be processed in a matter of minutes.” Similarly, Fahey explains, retailers can reduce delays by looking at how quickly they can process their security procedures, as fraud checks add an average of two hours to the overall timeframe.

Fahey agrees that the volume of custom last Christmas surprised many retailers. “One of our customers saw a 700% spike in the two weeks before Christmas.
“This year, I am expecting that the last weekend before Christmas will be very big. Customers are ordering later and will expect to be able to order on Sunday December 21 for delivery on 22 or 23, and to be able to place a next-day delivery order on December 22. If retailers have the right resources in place, and the communication is there, then we can all plan for it.”

Top tips
How to deliver your Christmas orders on time

- Work in partnership with your carrier company, and constantly review your planning
- Schedule more regular communication from December 10 onwards
- Use accurate forecasting tools to predict sales peaks
- Be realistic in your delivery promises
- Communicate your order cut-off dates to customers
- Have trained staff in position in good time

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