A fifth of UK retailers suspended delivery services during the pandemic
Whilst UK retailers have made headway in offering consumers more choice in online fulfilment options, almost a fifth (19%) had to suspend delivery services during the pandemic, the latest data from parcelLab, the operations experience platform, revealed.
Original research of 150 of the UK’s leading retailers in the ‘Operations Experience 2021 – How Does UK Retail Measure Up?’ Report, which benchmarked retailers’ performance around key metrics including checkout, shipping and returns, showed most retailers now offer a range of choices when it comes to delivery options. 57% offered three alternative delivery choices for shoppers ordering online, while almost a quarter 23% offer four fulfilment types.
With the pandemic boosting ecommerce sales, which grew 46% in 2020 – the fastest growth for over a decade – according to the ONS, retailers have pivoted to bolster their online fulfilment capabilities in order to meet demand. Next day remained the most popular alternative delivery format offered by 73% of retailers, followed by click-and-collect (70%).
Yet, in spite of adding additional delivery options, almost a fifth (19%) of retailers had to suspend delivery services due to the pandemic, with operational issues driven by social distancing requirements in warehouses slowing picking, staff shortages due to higher levels of absenteeism or not having enough flexibility within their own fulfilment or 3PL (third party logistics) suppliers to meet surges in demand.
And, while two thirds (66%) of retailers now offer to ship to parcel shops or collection lockers, such as Doddle or Hermes Lockers, just 4% of retailers were making the most of fulfilment to partnership store networks, offering collections or returns from other retail stores. And this could be a missed opportunity, not only to collaborate with complimentary retail businesses to leverage new sales channels, but also in partnering with ‘essential’ retailers, brands can open up additional store fulfilment options for consumers while non-essential stores must remain closed during lockdown. Electrical retailer, AO.com, for example, announced its partnership with Tesco in October, while Argos is offering collections from Sainsbury’s stores, and fitness brand Sweaty Betty allows delivery and returns via Waitrose.
Tobias Buxhoidt, Co-Founder and CEO of parcelLab, commented: “Retail businesses have had to pivot fast to ensure the capabilities of their own logistics networks can keep up with the booming demand for e-commerce during the pandemic, which has been amplified once more with Lockdown 3. And while they’ve made herculean efforts to extended delivery options, both in-house and via 3PLs, almost a fifth are still seeing disruption to alternative delivery options that are available to shoppers.”
“Friction in fulfilment was a problem for retailers before the pandemic, but now – especially when online is the main channel serving customers and communities – shoppers are even more likely to abandon a purchase – or, worse, lose loyalty with a brand – if they aren’t offered convenient delivery experiences and choices for fulfilment that meet their needs,” he concluded.