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Supported by

The eFulfilment supply chain covers a wide range of activities from systems integration, goods receipt, ware-housing, pick, pack, personalisation, carriage, returns and disposition and, with delivery and fulfilment one of the most important and challenging aspects of an e-Retailer’s offering, the need to carefully consider this area will only increase as the ecommerce market continues to grow year-on-year. With more investment and strategic focus on the final stage of the supply chain and the overarching emphasis on data management, UK delivery standards are very high and delivery infrastructure is highly developed. Delivery in the UK is every bit as crucial as checkout, payment processing and product specification and is an area that has been heavily impacted by the rise of mobile devices in the digital environment.

The UK has an excellent and wide range of delivery services providing a highly competitive pricing and service environment as well as a very effective addressing and post code system.

UK shoppers are sophisticated and demanding, requiring access to delivery information before they buy and in real-time prior to delivery taking place.

Logistics and Communications

UK delivery standards are very high and delivery infrastructure is highly developed.

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Delivery LocationDelivery to ‘Home’ remains overwhelmingly the most popular destination for online orders but the positive per-ception of the various ‘Click and Collect’ options is increasing, driven by the convenience of trip-chaining. When no one is at home to receive an order, delivery to a neighbour is still the most popular alternative delivery option with 83% of IMRG respondents saying they would be happy for a neighbour to sign for their order. It is important to bear in mind that a customer can only provide specific delivery instructions and nominate a designated safe place in case they are not at home if your data collection forms and the delivery company’s labels and protocols enable this – not all do.

UK consumers express the following preferences for delivery location:

Home delivery: 84%

Other location (e.g. work or collection point): 16%

Delivery NotificationsRecent years have seen a surge in UK delivery and logistics companies adopting a system of delivery notifications for distance orders. IMRG data evidences that UK consumers express the following preferences for notifications surrounding delivery events:

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Current Service Use As Requested By UK Consumers The table below and accompanying graph show the service preferences of UK consumers by detailing the percent-age of parcels and orders distributed by particular services and service types in the UK. This will form an important point of reference for an e-Retailer when deciding which delivery services to offer customers. It is important for a prospective merchant to offer delivery options covering both lower cost/slower speed and faster/timed deliveries, as each order will have different requirements. This data has been derived from the IMRG/MetaPack Delivery Index, which has data from more than 220 retailers using all of the major UK carriers. The sample represents more than 5 million orders in any single month.

Economy services, or services with no assured delivery lead time, no specific delivery day or time-slot, are the most popular choice with UK consumers, on the grounds of cost but also because service enhancements such as

Economy services, or services with no assured delivery lead time, no specific delivery day or time-slot, are the most popular choice with UK consumers, on the grounds of cost but also because service enhancements such as Tracking and Pre-Delivery Alerts (which have previously only been available on ‘premium’ services) make these services more reliable in the customer’s eyes.

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Tracking and Pre-Delivery Alerts (which have previously only been available on ‘premium’ services) make these services more reliable in the customer’s eyes.

Next day services are used more during peak periods such as Christmas, when shopping deadlines come into play.

Current ‘On Time Delivery’ or ‘Attempted Delivery’ Performance in the UK MarketMeeting UK customer expectations with delivery service provision is a vital component of any e-Retailer’s offering, and nowhere is this consideration more prominent than with deliveries where the customer has specified a timescale or a particular type of service. The IMRG/MetaPack Delivery Index records a performance of 91.9% for on time or attempted delivery (i.e., when the recipient is not present when the delivery is made) as a rolling average over the life of the Index. This performance has been improving over the past 12 months, with 92.9% of deliveries being on time or attempted during this time period. All prospective UK merchants should aim to ensure a similar, consistently high level of delivery service.

For the purpose of the above chart, ‘on time’ includes the following delivery events:

●● Delivered within the timeframe specified●● Customer pre-arranged to collect from post office or carrier’s depot●● Delivery attempted within the time specified but customer no longer at the address provided●● Delivery attempted within the time specified but refused by customer●● Delivery attempted within the time specified but subsequently returned to sender●● Delivery attempted within the time specified but no access to the recipient’s address●● Order cancelled●● Delivery arranged with customer (as in the case of an SMS alert where the customer chooses a different

delivery day)●● Inaccurate address●● Delivery attempted in the specified time but no one at home to receive the item – a carded delivery

The level of ‘carded delivery’ is helped by the relatively recent development of pre-delivery alerts helping delivery agents and consumers work together to avoid missed deliveries. From July 2013 to date the weighted average for ‘carded’ delivery attempts is running at 4.6%.

A prospective distance merchant should note that delivery performance can be impacted by address queries. In the UK, even during a peak in October and November 2013, the low number of address queries suggests that UK retailers do what they can to capture correct addresses and that the quality of addressing in the UK e-Retail market is high. To ensure satisfactory delivery performance, it is therefore important that an e-Trader broaching the UK market makes every effort to ensure quality of addressing. This is best achieved by using the Royal Mail Postal Address File (PAF) which is made available through a wide range of intermediaries.

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Click and Collect Click and Collect is becoming an increasingly popular method of order fulfilment in the UK, a territory which has lagged behind other markets until recently due to an historic culture of delivery to the door.

This came about following home delivery and capacity problems in 2010 which prompted retailers to promote Click and Collect to provide an additional delivery channel. The development of Click and Collect has continued, both ‘in store’ and through third party networks (post offices, convenience stores and locker banks) largely due to its convenience when combined with other activity and the certainty for the consumer of not missing a delivery. Additionally, charges are generally cheaper than they are with alternative delivery methods, and are sometimes waived altogether.

It is estimated that Click and Collect accounted for 19% of sales in the third quarter of 2013 for multichannel retailers with their own store networks, up from 13% in the same quarter the previous year. Retailers are largely seeing that the convenience of this option can greatly enhance the customer experience, and are adopting it accordingly. Indeed, according to Collect+, in November 2013 50% of multichannel retailers supported ‘in store’ Click and Collect, compared with 33% 12 months previously.

For retailers without UK store networks, there are a growing number of third party networks that can provide this solution.

For retailers without UK store networks, there are a growing number of third party

networks that can provide this solution.

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Click and Collect Solutions Providers Operating in the UK Market

Main 3rd Party networks November 2013

Post OfficeLaunching Click and Collect in 4,500 locations, aiming to raise this number to 10,500. Will exclude Post Offices from operating any other service

Collect+ 2013 – 5,250 locationsAmbition to eventually increase to 12,500 locations

Hermes Parcelshops 3,000 locations rising to 5,500 in 2014

UPS Access Points 3,000 locations, rising to 4,200 in 2014

Locker terminals ByBoxInPost

1,200 locations1000 locations

Network Rail - Doddle Plans to have 300 fully manned locations at railway stations

Excluding ‘in store’ and retail network collaborations (such as eBay / Argos). The UK currently provides in excess of 22,000 third party PUDO locations and this is expected to rise to in excess of 35,000 in the short term

ReturnsA strong returns proposition is important to UK consumers and the majority will wish to understand how they might return unwanted goods even before they browse the website, as shown in the chart at the beginning of this section.

If the customer does not feel comfortable with the returns process it is likely that they will not place the order at all.

UK consumers expect:

●● Easy and convenient ‘drop off’ or collection options●● To be kept informed on the progress of the return

●f The ability to track ‘in transit’●f Confirmation that the item has been received●f Confirmation that the credit or replacement has been arranged