Failed online deliveries are expected to cost British retailers £473 million this year while addingmarketplace deliveries is estimated to bring the costs further up to £771 million, according to the
IMRG Valuing Home Delivery Review 2014.As the result of innovation in e-retail deliveries, however, the costs related to faileddeliveries are estimated to have fallen by nearly 50 per cent over the last two years, when usinglike-for-like volumes, the British e-commerce association IMRG explained.
Conducted in cooperation with the UK-based delivery solutions provider Blackbay, the reviewconsiders the costs of several potential delivery failure scenarios. Along with failed deliveriesthat require a new delivery or collection by a customer, these also include late delivery, lostorders with the replacement to be sent, and returns, in case an order couldn’t be delivered and wasreturned to the sender.
Andrew Starkey, Head of e-Logistics at IMRG, said: “Failed deliveries resulting from ordersplaced with retailers and marketplace traders each year create in excess of a quarter of a billionpounds of avoidable costs – we cannot afford to allow the pace of innovation to slow. Recentinnovations in e-retail delivery have already reduced this cost and provide shoppers with morechoice, and more information about when and where they can expect their deliveries.”
“Giving the customer the ability to fully engage in the delivery process allows them to makemore informed decisions about the service they want and then to help manage the ‘final mile’ –cooperating with the delivery company to be in the right place at the right time. The result isreduced costs to all stakeholders and a greater customer satisfaction,” he added.
Nigel Doust, CEO at Blackbay, stressed that, despite significant improvements in the homedelivery performance over the last two years, carriers and retailers still fail to provide adelivery guarantee for every parcel, which is a common reason for frustration among customers.
“To rise to this challenge, and reduce the enormous costs highlighted in this report,carriers need to respond by finding ways to embrace a consumer relationship and enable consumercontrol as well as offering a range of alternative delivery services to them. Consumers aredemanding that carriers and retailers do better, hopefully retailers and carriers can continue tochallenge each other through technology improvements to close the gap between home deliveryperformance and consumer expectation,” he concluded.
