Member Article

The last mile lethargy

In spite of technological advancements in fulfilment and speed of deliveries quickening pace, UK retailers are still falling at the last mile hurdle, a new report from Sanderson, a software provider for multi-channel retailers, warns.

The ‘Chain Reaction: Maximising Margins In The Connected Retail Economy’ Report, suggests that, with 60% of baskets abandoned online being attributed to delivery-related issues, fulfilment is a key area which continues to cost retailers conversions and lost margins.

Even if a retailer has a single view of stock and can effectively match supply and demand across all of its sales channels to provide the optimum fulfilment point, there are still significant margins that can be won or lost when it comes to delivery – especially when retailers are often seeking to compete on speed of fulfilment.

This, the report suggests is borne out of retailers looking at the purchasing journey as an isolated series of moments, as opposed to an interlinked chain of actions and reactions.

A holistic view of stock, customers, data and orders across all channels is critical to connected commerce. It provides the 360 degree insights needed to enable effective order management, reduce out-of-stocks, and increase customer conversions, and allows every business decision to be made based on accurate, integrated data insights.

While the last mile was deemed to be the area of greatest improvement, the report identifies other key moments where the retail value chain could be optimised; fulfilment and returns. By focusing in on picking orders from the most profitable fulfilment point and streamlining the returns process across all channels, retailers can better focus energy in enhancing each stage of the customer’s purchasing journey to significantly increase profit margins each item sold in.

John McGuire, Managing Director of the multi—channel retail business at Sanderson, commented: “How retailers market, transact and fulfil orders from the growing number of touchpoints available to shoppers forms part of a wider value chain; and each decision they make along the connected commerce journey can set off a ‘chain reaction’, which will either optimise or reduce the profit margin on every product sold.

Many retailers are currently looking at aspects of this journey in isolation. However, to truly maximise margins, it needs to be viewed holistically. Every retailer should be striving for connected commerce; not just in terms of connecting the customer experience, but aligning the back-end operation within your organisation.“

To find out more about holistically optimising the value retail chain, download the full report: http://content.sanderson.com/chain-reaction

This was posted in Bdaily's Members' News section by Reporter .