Why next day delivery guarantees cost your business money

It was my youngest daughter’s birthday yesterday, she was 6 and she didn’t have the things she wanted for her birthday. I didn’t have a lot of time this year to find each present individually and I made the decision to shop online. On Wednesday I ordered all of her presents and I paid extra for guaranteed next day delivery.

But Thursday came and went, and they didn’t arrive. They didn’t arrive Friday either and I spent 30 minutes on Friday cancelling the orders for failing to be delivered on time. I got everything refunded back to me and then I went to Lakeside and bought her gifts.

When I had my money refunded from the gift companies, the delivery charges were refunded too as all the companies had promised me next day delivery and had failed to do that. As a business they still have to pay the courier company for the failed delivery and hope that the items are returned to their depot. If they are not for one reason or another, they lose the cost of the product as well as the cost of the failed delivery.

If the delivery cost £7 and the item £13, that’s £20 off the bottom line of your business. Now imagine this happening 100 times , that’s £2000 off of your profits, multiply that over a week and you are losing 10k of profits.

As a business you may have the time and a dedicated member of staff to sit there and collate all the data and file insurance claims and recoup some of that money but some will always slip through.

Isn’t prevention better than cure?

I should have gone to Lakeside in the first place. I shouldn’t have relied on an external courier and I thought that guaranteed next day delivery meant exactly that. At the time of ordering I was thinking like a customer rather than thinking like a delivery expert.

I know that things go wrong at the delivery hubs, I know that drivers don’t turn up and that agency drivers don’t do the work they should do. As a customer this isn’t my problem, my problem is taking the day off of work or working from home to wait for something and then it doesn’t get delivered. As a customer it’s frustrating and as a delivery business myself I get annoyed that the companies own thought is not getting my goods delivered but their profit sheets.

Friday I rang the delivery companies and asked why my goods hadn’t been delivered. One reason was they couldn’t find the house. We have our own postcode, we are the only property in that postcode. The chances are the driver didn’t even look to deliver our item, he or she wanted to get back to the depot and say it was undeliverable. One company said they didn’t have the item. It was lost, their tracking showed it was in the system but the reality was they couldn’t find the package. The third company said we were not in. So I asked for the failed delivery ticket, they didn’t have one. They promised re-delivery on Saturday but that didn’t happen either.

Only same day courier services are guaranteed, everything else next day / economy delivery is open to debate, even when promised to arrive at a certain time.

It’s in the small print. If you are reading this and thinking about your company deliveries let me ask you one thing – are you sending out and losing so much stock that you need a member of staff to fix the problem? Isn’t time you looked at prevention of the problem in the first place? Is it possible that your desire to save money and save a £1 per parcel is costing you business, time and energy that would be better spent rearranging the deckchairs on the Titanic; that would give you are better return than chasing down errant parcel companies.

The moral of the delivery story?

Next day can mean any time in the future, check your parcel companies small print. It doesn’t mean next day if your parcel company is short staffed or can’t find you on their sat nav, or they can’t find your package.

If you are leaving Christmas shopping online to the last minute remember that parcel deliveries triple in December and you should really be ordering the goods now in order to get them on time.

Kevin

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