It’s eight-thirty in the morning. Time is limited. You’re frantically searching through your wardrobe, wondering what to wear for tonight’s important social event when you notice that the kitchen cupboards are beginning to look rather bare and you ought to go grocery shopping.
Oh, and you need to be in the office ready to start work in less than half an hour.
Sound familiar?
The changing face of the retail sector
Now let’s add in a further scenario. The demise of your local high street has led to several reputable chains shutting up shop and calling it a day. Footfall is poor. The effects of ever-increasing business rate charges, the high cost of recruitment and a lack of adequate turnover have had a dramatic impact on the retail sector.
Your ability to shop locally, certain of being able to purchase exactly what you want, when you want it has diminished rapidly. The death knell has already been sounded and the hustle and bustle of the once thriving local shopping street has fallen silent.
Unfortunately, this is now an all too familiar scene across the nation. The retail sector has been forced to adapt and embrace a greater online presence, responding to the demands of a generation of tech savvy consumers.
But where does this leave you in your immediate quest for a suitable new outfit and your ability to quickly replenish your larder?
Unfortunately, this is now an all too familiar scene across the nation. The retail sector has been forced to adapt and embrace a greater online presence, responding to the demands of a generation of tech savvy consumers.
But where does this leave you in your immediate quest for a suitable new outfit and your ability to quickly replenish your larder?
Same day delivery services – the next evolutionary step in the trading battle
Click a few buttons, select your new dress and shoes, order your groceries, go to work and return home to same day deliveries. Problem solved.
This is no longer a dream, but modern day reality – a vision which some of the world’s largest retailers and delivery services are slowly beginning to put into practice.
Same day delivery wars are definitely heating up, but are they sustainable for the long term? Will same day deliveries become the norm or will they merely be the jewel in a crown reserved for the bigger players, the likes of Amazon or Walmart?
Whilst there’s little doubt that the ability to provide same day deliveries has tremendous commercial potential, couriers and logistics providers will need to significantly adapt their existing networks in order to take advantage of this major shift in commercial trends.
Here, we take a look at current industry drivers within the UK, challenges which winning players will need to overcome and consider the future landscape of same day delivery transportation.
Which companies are paving the way?
Amazon, the world’s largest retailer, is understandably at the forefront of the same day delivery race, having introduced services in Greater London and parts of Hertfordshire and Buckinghamshire, but is closely followed by Argos, offering seven day delivery options from all its UK stores.
Supermarket giants Tesco and Sainsbury offer limited UK same day delivery services and are piloting extended trials.
Similarly, new entrants to the transit market such as Deliveroo, Just Eats and Uber Eats will deliver hot takeaway meals to your workplace or home within an hour.
Shoreditch based Bizzby extends a same day delivery service to the world of professional services, promising to connect you with a tradesman – builder, plumber, electrician, etc within an hour, and many courier and logistics companies actively promote same day deliveries within a specified distance.
Overcoming challenges
Amazon’s strategy has been to increase its number of global distribution centres. It currently has nine within the UK alone.
Although its service is at present limited to those willing to pay an annual subscription to Amazon Prime, the company’s competitive edge lies within its vast network and extensive product range. Will other players in the market ever be able to emulate this and what challenges will they first need to overcome?
Amazon’s strategy has been to increase its number of global distribution centres. It currently has nine within the UK alone.
Although its service is at present limited to those willing to pay an annual subscription to Amazon Prime, the company’s competitive edge lies within its vast network and extensive product range.
Will other players in the market ever be able to emulate this and what challenges will they first need to overcome?
We believe the major hurdles any successful same day delivery operator will need to overcome will include the consideration of:
- Logistics
The success of same day delivery services firmly lies in implementing well-handled systems and processes to guarantee that stock levels are maintained, as well as having sufficient stores, warehouses and distribution centres to cope with demand.
- Costs
The key to a long term same day delivery service is its level of overall sustainability. Companies will have to keenly analyse minimum order values, pricing strategies and turnover rates of individual ranges to gauge the cost effectiveness of their services and maintain profit margins.
- Staffing Levels
Offering same day delivery services is likely to increase staffing numbers and associated costs. Failure to operate with an appropriate number of suitably qualified staff could easily have a detrimental impact to the quality of service offered. Staffing levels, reflecting the ongoing demands of the business, must always be maintained across all areas of operations.
The future landscape for same day deliveries
Consumers will continue to demand convenience when purchasing goods online and will push the bar higher and higher – reluctant to settle for a three to four day service once they’ve experienced a same day delivery service.
Further growth is likely in both the business to consumer (B2C) and business to business (B2B) markets. From the consumer perspective, as more and more retailers respond to demand, a greater population will have access to same day delivery options as well as a wider selection of goods. Younger generations growing up with the ability to order takeaway meals and food delivery via apps will result in same day and selected hour deliveries becoming the norm. The advent of e-prescriptions opens the door to medicines being delivered to the housebound by courier services. And as organisations identify elements of their supply chain which could be carried out more effectively through the use of same day specialists, demand will also rise within the B2B market.
Further growth is likely in both the business to consumer (B2C) and business to business (B2B) markets. From the consumer perspective, as more and more retailers respond to demand, a greater population will have access to same day delivery options as well as a wider selection of goods. Younger generations growing up with the ability to order takeaway meals and food delivery via apps will result in same day and selected hour deliveries becoming the norm. The advent of e-prescriptions opens the door to medicines being delivered to the housebound by courier services. And as organisations identify elements of their supply chain which could be carried out more effectively through the use of same day specialists, demand will also rise within the B2B market.
Whilst same day delivery wars do appear to be heating up, we think there’s sufficient space for parcel carriers, courier and logistic companies, high street chains, and multi-national transit companies to be able to serve individual roles. From Deliveroo delivering a Friday night takeaway, the small courier company delivering parts to a manufacturer or the global player transporting large consignments across the UK, same day deliveries bring exciting new opportunities. A definite win-win situation.