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Logistics

Norbert Dentressangle delivery van

Introduction

UK online consumers are arguably the most sophisticated in the world when it comes to delivery expectations. Almost 27 million households packed onto an island, where the maximum distance between major population centres is only 650 miles, means that a significant number of carriers and couriers can claim to offer national delivery services, creating a highly competitive environment where retailers and their customers have a wide choice of services.

 

There is a concentration of online orders in London and the South East of England but in order to succeed in the UK a non-UK retailer will need to offer a fully national delivery solution.


Cross-border considerations

UK consumers are highly attractive to non-UK retailers with a high per capita online spend and a confidence in online retailing which means they are fully prepared to look outside of the UK to buy the products they want if the price, quality etc. are right.


The latest IMRG Blackbay UK Consumer Home Delivery Survey confirms that almost 65% of respondents have shopped cross-border but that when making that decision it is still delivery and returns issues that create the biggest concerns.

 

So when dealing with UK online shoppers it is important to get the logistics offer right and just as important to communicate this offer clearly and frequently through the buying process - two-thirds of UK consumers feel that access to clear delivery and returns information, before they start to shop, is important in making their shopping experience more convenient.


What do local consumers expect?

Price, demand and a lack of availability with UK retailers are cited as the key drivers behind shoppers venturing to international retailers with many being unconcerned about where a retailer is based, as long as they’re selling the right product at the right price. A significant number of cross-border purchases are made via marketplace sites such as eBay and Amazon suggesting consumers mainly head to international retailers when the product they’re after is niche.

 

However, price and choice aside, delivery and returns are very important to UK consumers and has now become an important factor, differentiating retailers they will and will not shop with. In order to win customers non-UK retailers should appreciate that 70% of UK consumers positively confirm that a good delivery experience will encourage them to return and shop again with the retailer providing it.


Click & collect

Despite the preference for home delivery, over the past five years click & collect has been gaining in popularity. This is where the customer can choose to collect their online order from the retailer’s own store, a parcel-shop or a locker bank at a time and place to
suit them. Awareness of this option is now very high with 98% of UK consumers and with three quarters having used it or intending to use it in the future.


Amongst the click & collect variants for those that have used this service, collecting from the retailer’s store is most popular amongst UK shoppers with 70% having used this service3 but this is unlikely to be an option for non-UK retailers who will not have store networks
in the UK. To overcome this barrier, there are now extensive parcel-shop and locker networks in the UK, many aligned to particular carriers.

 

Non-UK retailers should actively look at their ability to access local parcel-shop or locker networks because up to 35% of UK shoppers have used this option which is also popular for returning unwanted orders. This also provides an element of brand association. If the shopper knows and trusts the click & collect provider, that trust extends to an overseas retailer.


Returns

A very important element for any retailer’s offer to UK consumers must be the ability to accept returns and make the returns and refund / replacement process convenient. When surveyed5, 60% of UK consumers stated that the ability to return unwanted orders and get a credit was a concern and potential barrier for them shopping with a non-UK retailer.

 

For non-UK retailers unable to offer their own stores for the customer to return to, the most used option is Post Offices, using Royal Mail or Parcelforce to provide the logistics link to the local postal administration. Royal Mail is a leading participant in the recently developed IPC (International Post Corporation) Common Return Platform which allows the seller to provide the consumer with an internationally accepted, pre-paid label. With the UK and Royal Mail as one of the original participating countries, the service is now available from nine other markets.


In addition to Post Offices for accepting returns, non-UK retailers may also have access to the click & collect networks and collection from home services offered by global carriers, which then integrate with their corresponding returns distribution services.


As with deliveries there is also the option to use a managed solution through a ‘returns portal’. This is a website (which may have the option to be integrated into the retailer’s website) which the consumer is asked to visit when making a return. This can identify the product, the reason for the return etc. and give the consumer returns options best suited to that situation. Labels and instructions are then provided and once again some click& collect networks may be available. Providers of such returns portals, serving the UK market include RoyalMail, MetaPack, wnDirect and ReBound.

 

When sufficient volumes of orders (and returns) are being generated, another option for dealing with returns is to arrange for them to be consolidated and managed ‘in country’.

Further information

To access the Full Report, follow this link here to register and download.

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Business Environment

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Finance and Payments

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Corporate Forms

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