• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
  • Skip to secondary sidebar
  • Skip to footer
  • Home
  • Subscribe
  • Your Membership
    • Edit Your Profile
  • Services
    • Advertising
    • Case studies
    • Design
    • Email marketing
    • Lead generation
    • Magazine
    • Press releases
    • Publishing
    • Sponsored posts
    • Webcasting
    • Webinars
    • White papers
    • Writing
  • Shop
    • My Account
    • Cart
  • About
    • Contact
    • Privacy
    • Terms of use
  • Events

Robotics & Automation News

Market trends and business perspectives

  • News
  • Features
  • Sections A-Z
    • Agriculture
    • Aircraft
    • Artificial Intelligence
    • Automation
    • Autonomous vehicles
    • Business
    • Computing
    • Construction
    • Design
    • Drones
    • Economy
    • Energy
    • Engineering
    • Environment
    • Health
    • Humanoids
    • Industrial robots
    • Industry
    • Infrastructure
    • Investments
    • Logistics
    • Manufacturing
    • Marine
    • Material handling
    • Materials
    • Mining
    • Promoted
    • Research
    • Robotics
    • Science
    • Sensors
    • Service robots
    • Software
    • Space
    • Technology
    • Transportation
    • Warehouse robots
    • Wearables
  • Video
  • Webinars
  • White papers
  • Press releases
  • Featured companies
    • AMD Xilinx
    • BlueBotics
    • Elite Robot
    • RGo Robotics
    • SICK Sensor Intelligence
    • Vicor Power
shopping trolleys

Report: Retailers must ‘go the extra mile’ on delivery

March 6, 2019 by Anna

A new study from the Capgemini Research Institute has highlighted that retailer investment in “last mile” delivery – the final leg of the online purchase journey – is needed in order to uncover new revenue streams.

The report found that 97% of organisations believe that current last-mile delivery models are not sustainable for all locations, and that free shipping costs cannot be maintained unless delivery costs are reduced through automation.

“The Last-Mile Delivery Challenge: Giving retail and consumer product customers a superior delivery experience without impacting profitability,” study surveyed over 2,870 consumers in addition to 500 supply chain executives, and entrepreneurs and industry leaders.

The key insights from the report include:

Profitable opportunities lie in getting the last-mile experience right through automation: With warehouse and product sorting representing one-third of supply chain costs, there is a significant opportunity in automation.

Recognising this opportunity, 89% of organisations are investing in the mechanisation and automation of store back-rooms to expedite fulfilment and deliveries.

Forty percent of customers currently order groceries online at least once a week: This number is expected to reach 55% by 2021.

Forty percent of customers class delivery services as a “must have” when purchasing food and grocery products, with 1 in 5 (20%) prepared to switch retailers if this is not provided.

Evolving consumer behaviour is also fuelling greater immediacy in purchasing: 59% of customers purchase products online when they need them, rather than wait until the weekend to buy in-store.

Fast and effective last-mile delivery increases customer spend and loyalty: Encouragingly, 74% of satisfied customers intend to increase spend by as much as 12% with retailers they frequently purchase from.

The majority (82%) of customers have shared positive experiences with friends and family, and just over half (53%) would even be willing to purchase a paid membership for a good delivery service.

However, despite 55% of customers expressing that offering 2-hour deliveries would increase loyalty, only 19% of firms currently provide this compared to 59% of firms that offer a delivery time frame of over 3 days.

65% of customers use alternative grocery delivery services – such as Google Express, Instacart or Ocado – for better services than from traditional retailers.

The report finds that consumers are not satisfied with the current state of last-mile delivery with high prices (59%), non-availability of same day delivery (47%), and late deliveries (45%) being the driving factors of ‘delivery dissatisfaction’.

Nearly half (48%) of dissatisfied customers would stop purchasing from the offending retailer if unsatisfied with delivery, and those who would continue would reduce their spend by 45%.

By comparing and contrasting attitudes between retailers and customers, the report identified the following trends:

Organisations are currently charging customers only 80% of the overall delivery cost, and deliveries are now the most expensive part of the supply chain.

The report found that 97% of organisations believe that current last-mile delivery models are not sustainable for full scale implementation across all locations.

As such, they must be viewed as a key investment for 2019, with only 1% of customers willing to absorb the total cost incurred for last mile deliveries.

Despite low delivery costs being the top priority for half of all customers, only 30% of organisations considered it a top priority for themselves.

Similarly, almost three quarters (73%) of consumers expressed that having convenient time slots available was more important than receiving deliveries quickly, yet only 19% of firms rate this ability as a priority.

The report did, however, find that customers are open to experimenting with ‘crowd-sourced’ style delivery options: for an incentive (the most popular being monetary), 55% were willing to deliver products to neighbours in their vicinity, with 64% indifferent if a delivery were made by a retail store employee, private individuals, or third-party couriers.

In fact, 79% of customers are willing to deliver these groceries at a price that is less than the current cost incurred by retailers to deliver it themselves.

The report closes with the following recommendations for last-mile delivery success:

Optimise fulfilment locations: Increasing store-based deliveries by 50% could potentially lead profit margins to soar by as much as 9%.

Dark stores – retail outposts with store-like layouts intended only to fulfil online orders – can also process high delivery volumes and are 23% cheaper than conventional stores for same day deliveries.

Additionally, if 30% of deliveries and returns are routed through parcel locker collection arrangements, organisations could expect an 8% increase in profit margins.

Automate delivery options: The report finds that back-room automation could increase profits by up to 14% by reducing the cost of click-and-collect orders and deliveries from store.

Furthermore, automation offers a range of benefits including reduction of fulfilment errors, and managing returns (which forms 26% of the delivery cost).

Tim Bridges, Global Sector Leader, Consumer Products, Retail and Distribution, at Capgemini said, “Today customers are neither satisfied with the quality of delivery services, nor willing to bear the total cost of last-mile delivery.

“Therefore, the dilemma facing retailers is to provide last-mile delivery services that customers value, without damaging their own profitability.

“If done right, and their last-mile experience can win over customer satisfaction, retailers stand to gain loyalty, increased purchase value and frequency, while mitigating profitability risk through automation and optimisation of fulfilment locations.”

A copy of the report can be downloaded here.

Print Friendly, PDF & Email

Share this:

  • Print
  • Facebook
  • LinkedIn
  • Reddit
  • Twitter
  • Tumblr
  • Pinterest
  • Skype
  • WhatsApp
  • Telegram
  • Pocket

You might also like…

Filed Under: Features Tagged With: capgemini, last-mile delivery, online, retail

Join the Robotics & Automation News community

Primary Sidebar

Latest articles

  • The future of modern application development with .NET
  • Here are 3 Ways That You Can Use Baking Soda for Office Cleaning
  • How to Get a Crypto Trading Bot
  • Beyond the CMS Norm: Embracing Customization in Online Media Management
  • Boosting Growth: Exploring ERP Solutions For Small Businesses
  • Unveiling the Power of Apple Gift Cards: Your Comprehensive Guide
  • Optimizing Your Plumbing Business: SEO Best Practices for Plumbers
  • The Profit Potential of Auction Homes: A Comprehensive Guide for Real Estate Investors
  • Elevator Shoes: Get the looks you want
  • ReactJS vs. VueJS: Understanding the Differences

Most Read

  • Snapchat Plus Planet Order 2023 Explained
    Snapchat Plus Planet Order 2023 Explained
  • Why is Money Important in Our Lives?
    Why is Money Important in Our Lives?
  • Top 20 electric vehicle charging station companies
    Top 20 electric vehicle charging station companies
  • Difference Between Three-Phase and Single-Phase Power
    Difference Between Three-Phase and Single-Phase Power
  • The Future of Personal Computers: What to Expect in the Next Decade
    The Future of Personal Computers: What to Expect in the Next Decade
  • Top 20 programmable logic controller manufacturers
    Top 20 programmable logic controller manufacturers
  • Why is My Car Key Stuck in the Ignition?
    Why is My Car Key Stuck in the Ignition?
  • How to Perform a Network Security Risk Assessment
    How to Perform a Network Security Risk Assessment
  • Scientists have found more water in space than they ever knew possible
    Scientists have found more water in space than they ever knew possible
  • Figure raises $70 million Series A to support commercialization of Figure 01 humanoid robot
    Figure raises $70 million Series A to support commercialization of Figure 01 humanoid robot

Overused words

ai applications automated automation automotive autonomous business companies company control customers data design development digital electric global industrial industry logistics machine manufacturing market mobile operations platform process production robot robotic robotics robots safety software solution solutions system systems technologies technology time vehicle vehicles warehouse work

Secondary Sidebar

Latest news

  • The future of modern application development with .NET
  • Here are 3 Ways That You Can Use Baking Soda for Office Cleaning
  • How to Get a Crypto Trading Bot
  • Beyond the CMS Norm: Embracing Customization in Online Media Management
  • Boosting Growth: Exploring ERP Solutions For Small Businesses
  • Unveiling the Power of Apple Gift Cards: Your Comprehensive Guide
  • Optimizing Your Plumbing Business: SEO Best Practices for Plumbers
  • The Profit Potential of Auction Homes: A Comprehensive Guide for Real Estate Investors
  • Elevator Shoes: Get the looks you want
  • ReactJS vs. VueJS: Understanding the Differences

Footer

We are…

Robotics and Automation News was established in May, 2015, and is now one of the most widely-read websites in its category.

Please consider supporting us by becoming a paying subscriber, or through advertising and sponsorships, or by purchasing products and services through our shop – or a combination of all of the above.

Thank you.

Independent

Archivists

March 2019
M T W T F S S
 123
45678910
11121314151617
18192021222324
25262728293031
« Feb   Apr »

Complex

Old-skool

This website and its associated magazine, and weekly newsletter, are all produced by a small team of experienced journalists and media professionals.

If you have any suggestions or comments, feel free to contact us at any of the email addresses on our contact page.

We’d be happy to hear from you, and will always reply as soon as possible.

Future-facing

Free, fair and legal

We support the principles of net neutrality and equal opportunities.

Member of The Internet Defense League

Copyright © 2023 · News Pro on Genesis Framework · WordPress · Log in

We use cookies on our website to give you the most relevant experience by remembering your preferences and repeat visits. By clicking “Accept”, you consent to the use of ALL the cookies.
Do not sell my personal information.
Cookie SettingsAccept
Manage consent

Privacy Overview

This website uses cookies to improve your experience while you navigate through the website. Out of these, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website. We also use third-party cookies that help us analyze and understand how you use this website. These cookies will be stored in your browser only with your consent. You also have the option to opt-out of these cookies. But opting out of some of these cookies may affect your browsing experience.
Necessary
Always Enabled
Necessary cookies are absolutely essential for the website to function properly. These cookies ensure basic functionalities and security features of the website, anonymously.
CookieDurationDescription
cookielawinfo-checkbox-analytics11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Analytics".
cookielawinfo-checkbox-functional11 monthsThe cookie is set by GDPR cookie consent to record the user consent for the cookies in the category "Functional".
cookielawinfo-checkbox-necessary11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookies is used to store the user consent for the cookies in the category "Necessary".
cookielawinfo-checkbox-others11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Other.
cookielawinfo-checkbox-performance11 monthsThis cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Performance".
viewed_cookie_policy11 monthsThe cookie is set by the GDPR Cookie Consent plugin and is used to store whether or not user has consented to the use of cookies. It does not store any personal data.
Functional
Functional cookies help to perform certain functionalities like sharing the content of the website on social media platforms, collect feedbacks, and other third-party features.
Performance
Performance cookies are used to understand and analyze the key performance indexes of the website which helps in delivering a better user experience for the visitors.
Analytics
Analytical cookies are used to understand how visitors interact with the website. These cookies help provide information on metrics the number of visitors, bounce rate, traffic source, etc.
Advertisement
Advertisement cookies are used to provide visitors with relevant ads and marketing campaigns. These cookies track visitors across websites and collect information to provide customized ads.
Others
Other uncategorized cookies are those that are being analyzed and have not been classified into a category as yet.
SAVE & ACCEPT