A management professional with a passion towards leveraging new age technologies and processes, Anshul has pursued my MBA from Symbiosis University and Leeds University (UK). He is currently the Co-Founder and CEO of Quickshift which is one of the fastest growing E-commerce fulfillment services companies in India, which helps new age and D2C brands scale across the country. Prior to Quickshift, he was a consultant with Dencowear a workswear brand in UK and over the past few years have spent significant time in understanding how business/ startups operate and scale. Having a solid business acumen, he has been able to build teams, drive and scale complex operations, with new age technology and design being at the very core of all my initiatives.
The new-age smart shopper shops by the click and expects delivery by the click. If you have experienced the recent Amazon delivery trend then you know the luxury of same day delivery. Buyers do not need to hurry out for every small requirement, they need it delivered and they need it quickly.
Same day delivery might sound like a luxury, but really it is just basic daily requirement powered by efficient technologically backed logistics, who really are interested in serving their clients right and capitalizing on the opportunity.
The new normal has brought about quick and technological advancements in every sector which needs immediate appeasement, especially delivery speeds as customers expect what they ordered soon after they order online.
The most popular categories for online purchases include: Clothing, household items, groceries, cleaning supplies, and electronics.
Studies at Amazon show that the option of same-day delivery alone actually increases purchase conversion during the checkout process by 20 to 30%, although not every customer actually opts for same-day delivery.
How does same-day delivery work:
Same-day delivery concept has emerged due to the inability to step out to a brick-and-mortar store and get the requirement fulfilled, as early as the snap of fingers, for many buyers which have high per capita income and are ready to pay for premium services.
Consumers want to have multiple delivery options to choose from, and to receive their products as fast as possible. Once consumers have experienced a superior service level, they are usually hesitant to return to the previous inferior level. Thus, adding to loyal client base and increased sales.
A good example would be Amazon prime and Swiggy one, where consumers are willing to pay for monthly subscription as an upgrade to the services. According to Invesp research, 61% of consumers are willing to pay more for same-day deliveries.
Same-day delivery business benefits:
Same-day delivery calls for decentralisation in order to fulfil the instantaneous requirements. Research shows that people intend to order more while having a same day delivery option and there is low rate of abandoning the carts.
Global statistics claim that 41% of all customers are willing to pay extra to have their order in hand as soon as possible, meaning businesses can charge a premium for same-day service.
A few items preferred for same day delivery are:
- Groceries and vegetables
- Pharma and beauty
- Flowers and gifts
- Office supplies
- Cleaning supplies
We can hardly imagine the market share that can be captured, if this segment is catered right and boost business.
How does same-day delivery provide impetus to your business:
There is a higher Same-day delivery and it is a big opportunity for all retailers: local and e-commerce to improve their sales and service, but requires a high degree of sophistication and logistical experience with data backed technology.
The complex challenge of receiving, processing, fulfilling, and delivering an order within a few hours requires new types of networks and upgradation to the current e-commerce operation. The current processes used by parcel logistics providers are not suited to same-day delivery at scale. In such cases, one might have to divulge with local couriers. More flexible local city couriers, on the other hand, cannot deal with large retailer volumes.
The creation of a same-day delivery network comes at a high cost. Large volumes in each delivery needs to be achieved, which is difficult in the beginning and depending on the operating model, may require extensive upfront investment. In addition, the speed at which the deliveries are made necessitates a more sophisticated asset and capability base that inevitably results in a higher price point for the logistics service.
Technology start-ups, aggregate local courier capacity on a broker platform to manage and operate flexible courier networks. Retailers that are integrated with this platform can offer same-day delivery as an additional option in the checkout process of their online shops. Single orders are dynamically assigned to a courier with free capacity from the network, which picks up and delivers the order within a couple of hours.
Only technologically advanced retailers and logistics providers will be able to offer same-day delivery.
However, there are few criteria that help optimize smooth and efficient same-day delivery:
- Locally available: products need to be locally available. Depending upon the operational model, product needs to be sufficient, especially when the respective retailer generates enough volume to justify frequent pickup/delivery routes to the main centres.
- Assess your demand: Same-delivery requires smart inventory management. This requires product to be shipped to the consumer as soon as possible and fulfilment capacity to cater to the demand.
- Product availability: All the products offered for same-day delivery criteria need to be available locally and currently in stock.
- Real-time visibility: the websites need to have real-time visibility of their stocks all across your channels such as website, warehouses and physical outlets. This requires well placed IT infrastructure to avoid dissatisfied consumers at the end of the order process.
- Fulfilment capacity and warehouses: Parcel logistics providers struggle to offer same-day delivery as it requires flexible intraday pickup and delivery with a maximum of one transition point. This means some changes to your current internal logistics.
- Flexibility: your delivery partner needs to be adaptable and quick enough to pick up and deliver orders single or multiple times throughout the day.
Due to the time and financial burden of achieving same-day shipping, many businesses opt to partner with third-party logistics providers who have an extensive network of resources and warehousing locations. They help you save your time, money and are flexible enough to accommodate your needs both in busy and slow times.
Your logistics operator may operate in regions where you have no business presence, which means you can leverage their network to expand into new markets, thus, increasing sales.
In a same-day delivery model, one is willing to pay a certain amount for a certain amount of time saved. The amount people are willing to pay extra is equal to the utility gained by the time saved.