How can pickup points reduce failed deliveries?

From retailer through to carrier and customer: missed deliveries impact everyone across the supply chain. But it’s not all doom and gloom: pickup software can fix a system that is fundamentally broken, bringing time and cost savings for everyone. Here’s how.

Firstly – why do online retailers need to address failed deliveries?

Simply, it’s cost, cost, cost. Late deliveries, redeliveries, lost orders and refunds add an average $17.20 per order, or around  $197,730 per year. Ecommerce retailers know this. Missed deliveries are a headache of mammoth proportions. In fact, Enterprise Times have stated “99% of ecommerce organizations own up to failed deliveries across some portion of their orders, while 24% admit more than one in ten orders aren’t delivered on the first attempt.”

Why? The system is broken.

Do you know what you’ll be doing in 2-5 days’ time? The reality is: however well planned your customers claim to be, they lead busy lives, just like you do, where things can change at any moment. 

When they pick a time to be available for a delivery, they’re more often than not leaving it to chance whether they’ll be at the chosen location to sign for their package. This alone is enough to create misery in the supply chain. 

Throw in recent challenges of having enough drivers, outsourcing to new or inexperienced gig drivers and the odds of packages consistently reaching their destinations are low.

As consumers, we know the pain only too well. In fact, nearly half of us have looked forward to a package, only for it never to arrive. So why do we put up with it? Because the people selling to us have always done it that way. Let’s dig into the fundamental issues with this.

Missed deliveries: what are the main problems for retailers?

When it comes to delivering door to door, retailers (and in turn, carriers) have the odds stacked against them. For example:

• People not home: it’s not 2020 anymore. People can’t be relied on to be home to receive their goods. We humans are capricious in our behavior, and it’s unrealistic for a retailer to try to keep up with our whereabouts.
• Blocks of apartments: apartment lobbies are overflowing with package deliveries. Carriers are frustrated by buzzers that don’t work, people that don’t answer – and finding the appropriate management office adds time they don’t have. Packages are more likely to be lost, stolen or mismanaged as residents strive to get their stuff, leaving residents no choice but to befriend neighbors or invest in expensive mailbox options. 
• People not coming to the door quickly enough: whether through disability, caring duties or the fact they’re simply taking a shower, customers may not answer the door immediately, leaving the time-pressed carrier to place the package somewhere inaccessible.
• Nowhere to safely store/leave: carriers are duty bound to leave packages in weatherproof areas away from prying eyes. If a customer’s nominated ‘safe place’ doesn’t meet these criteria, then a reputable carrier has no choice but to try again.

Missed deliveries: common delivery problems for carriers

Carriers have their own specific challenges to overcome which all weigh heavy on the cost to deliver:

• Route management: the more addresses the carrier has to deliver to, the more complex the route, adding labor costs to all aspects of fleet management.

• Capacity & hiring driver challenges: the shortage of drivers across the supply chain, combined with a shrinking and aging labor market, is putting pressure on companies to keep up with demand. 

Rising fuel costs: carriers that are forced to start/stop/idle as they navigate multiple addresses on a single street waste fuel. This only intensifies as the pattern is repeated as they drive to the next block.

Missed deliveries: common delivery problems for consumers

As consumers ourselves, we’re acutely aware of the cost of missed deliveries:

• Customers end up paying double because they can’t wait: despite the valiant efforts of the carrier to keep the customer up to date, they missed the delivery. Trouble is: they needed that item ASAP, so head out to the bricks and mortar store to buy something else. Not great for online retail and customer experience. 
• The package got stolen: package theft, aka porch piracy, is on the rise. It can take place anywhere across the supply chain but typically occurs when opportunists swipe an unwatched package left in good faith at a so-called ‘safe space’. As consumers and carriers waste time in lengthy investigations, the retailer feels they have no choice but to provide a goodwill gesture of replacement in order to retain custom.

The goods arrive damaged: without a named safe place to leave the package, carriers may leave items with a risk of becoming damaged by the elements.

Pickup points are available NOW and can solve 99.9% of missed delivery problems.

The fact is, costs of missed deliveries to retailers cannot continue as businesses scale.

Home delivery is a mismatch for today’s way of life. If you were a retailer, you wouldn’t offer one shirt in one color. You’d offer as much choice as possible. So why make it difficult for customers to pick a delivery solution that is most convenient for them?

Time to think outside the package. 

Pickup points solve this problem in one swoop. It allows the customer complete freedom about when, and where, they collect. It’s all that choice – sizes and colors – rolled into one simple solution, and at a competitive price. 

Pickup point software can transform the costly process of home delivery, simplifying every stage to reduce costs for everyone in the supply chain. By enabling people to opt to collect their package from a convenient, safe location, 90% of the issues get fixed. For example:

• No worries about products becoming damaged

Pickup points can range from convenience stores to Post Offices, grocery stores and gas stations and major brand outlets, all of which should offer safe storage away from the elements. This reduces the likelihood of packages becoming damaged or wet.

• Packages kept safe until customers are ready

The packages typically enter a CCTV video surveillance-monitored environment and are only passed to the recipient on the production of suitable ID. Together, customers have peace of mind that their valuables are being adequately safeguarded. The extra security reduces the likelihood of packages being stolen in plain sight.

• Customers pick up to their own schedule

Customers can be offered multiple collection options to suit their preferred time, date and location. This means that they can collect at literally the closest location to them, whether that’s work, home, or even where they’re staying on vacation. As a result, they’re not restricted to time slots and less likely to leave at-home delivery to chance.

• Cost effective, for carrier and retailer

By consolidating packages and sending them to a wide network of locations, retailers and carriers can pack more items more quickly and drop them to customers faster than if they were traveling to individuals, creating big efficiencies for both sides.

• Big gains for carriers too 

Batching deliveries into fewer delivery dropoff points means less time on the road, fewer emissions and lower fuel costs: all increasing the likelihood of fast, first-time delivery to the customer.

What ecommerce shipping solutions are there?

HubBox provides software that makes it easy to give retailers and carriers pickup options their customers will find easy, convenient and flexible. With functionality designed specifically for the needs of both retailers and carriers, it is simple to set up and use. Working with the likes of UPS and DPD, it provides software for retailers to launch local pickup options at checkout. 

Find out more at HubBox or to see the software in action, book a demo.