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Just 16% of UK consumers are satisfied with delivery services every time

Over two thirds (68%) of UK consumers have had an issue with delivery in the last three months – and, as a result, 24% lost trust in a delivery company and 24% lost trust in the retailer.

That’s according to Descartes Systems Group’s latest Consumer Online Delivery Research, which set out to assess consumers’ online purchasing experiences across Europe.

Undertaken by SAPIO Research during July 2021, the interviews with consumers across Europe highlighted that quality of the delivery service is undermining overall customer perception of both delivery companies and retailers – leading to lost sales.

The research concludes that retailers need to take ownership of the end-to-end experience, in order to address consumer expectations regarding tracking and communication; safe delivery and ease of return; and, increasingly, environmental considerations.

Key findings include:

  • The quality of the experience has been far from perfect: just 16% of UK consumers are satisfied with the delivery service every time.
  • Over two thirds (68%) have had an issue with delivery in the last three months – and, as a result, 24% lost trust in a delivery company and 24% lost trust in the retailer.
  • Over a third (37%) of consumers also share their perception of both delivery company and retailer with friends and family – creating a ripple effect that rapidly undermines consumer perception.
  • 71% of European consumers consider the environment when making an online order
  • Almost a third are interested in bulking all orders to one weekly delivery.

Since the beginning of the COVID-19 pandemic, the proportion of purchases made online has grown from an average of 32% to 43% and is expected to remain at 41% for the foreseeable future. More than half (51%) of consumers have increased the number of purchases they make online, and 51% now make an online purchase at least once a fortnight – almost double the number (28%) pre-pandemic.

Despite these statistics, the research findings underline the fact that deliveries are failing to achieve complete customer satisfaction, with nearly nine in ten (87%) customers not always satisfied with the delivery services received. With satisfaction rates even lower for consumers who have reduced their online buying behaviour during the COVID-19 pandemic, the implications of inadequate delivery experiences cannot be overlooked.

Timing is the biggest issue for home deliveries – with two in three (68%) UK consumers reporting a delivery problem in the last three months. Delivery problems radically affect customer perception – and not just of the delivery company. While almost a quarter (24%) lost trust in the delivery company, 24% also lost trust in the retailer and 23% did not buy from that retailer again.

Given that many consumers were a captive audience during COVID-19 pandemic lockdowns, these delivery problems should raise serious alarm bells for retailers. With just 16% of UK consumers confirming they are totally satisfied with the delivery service, a company’s ability to meet its delivery promises will become increasingly important to reinforce the quality of customer experience and maximise the chances of customer retention.

Descartes says questions retailers should, therefore, be seriously considering, include:

  • How proactively is the retailer tracking delivery performance?
  • What is the strategy for managing spiralling delivery costs and optimising driver time?
  • What is the strategy for meeting customers’ environmental expectations? Can the delivery model support bulk orders and green scheduling? Are the right vehicles being automatically assigned to deliver in Clean Air Zones?

Pol Sweeney, VP Sales and Business Manager UK, Descartes, said: “Consumers will not return to pre-pandemic shopping habits; having become used to the convenience of ecommerce, online purchasing will continue to dominate. Individuals have become far more confident and sophisticated online over the past 18 months and expectations have risen, leading retailers to enhance the online experience, but as this research reveals, the quality of the delivery service is undermining the overall customer perception and leading to lost sales. Retailers that take ownership of the entire end-to-end experience and truly optimise the delivery process have the opportunity to transform customer perceptions, drive additional sales and, critically, entice customers from poorer performing competitors.”

Early preparation ‘remains key’ to avoid Brexit & COVID supply chain disruption

43% of businesses have been impacted negatively by Brexit in 2021 – but 19% of businesses are thriving in a post-Brexit world.

That’s one of the conclusions of Descartes Systems Group’s latest Brexit research report: Beyond Brexit: The Realities of Brexit for UK-EU Cross Border Trade.

Following its 2020 research on Brexit preparedness of UK companies, this latest report analyses how business has been affected by both Brexit and the COVID-19 pandemic and the level of uncertainty around the future.

Undertaken by SAPIO Research during March 2021, the interviews with supply chain managers assessed the specific elements of EU trade that have been affected, the resulting disruption and the expected performance of supply chains in 2021.

Key findings include:

  • Mixed performance: 43% of businesses have been impacted negatively by Brexit in 2021 – but 19% of businesses are thriving in a post-Brexit world.
  • Disruption reality: 90% of businesses have faced disruption since the end of the Brexit transition period.
  • Economic impact of Brexit: 53% expect their 2021 turnover to be lower than if the UK had remained in the EU – and the average reduction is 29%.
  • Pandemic impact: 76% had their Brexit response disrupted by COVID-19.
  • Early preparation has proven key to success, with those businesses that started their customs filing preparations in 2019 (24%) and early 2020 (33%) thriving most.

As predicted in Descartes’ 2020 research, Brexit has had a negative impact on both business and the economy. Of the companies surveyed, 90% have experienced disruption in their ability to trade in and out of the EU in 2021 – with 20% experiencing significant disruption since the transition period ended. Despite the high level of concern revealed in the 2020 survey, 40% of companies have actually experienced worse-than-expected EU supply chain performance, according to Descartes’ latest report. Additional key findings include:  

  • 80% of businesses reported disruption to their cross-border trade with the EU or Northern Ireland (NI), rising to 93% for medium and large enterprises 
  • 40% have experienced delays in their supply chains 
  • 37% have experienced increased cost of imports
  • 36% have had to manage customs declarations 

The combination of COVID-19 on top of Brexit created unprecedented challenges for businesses of every size, in every market. Confidence has been affected. Three quarters (76%) of companies confirm that COVID-19 disrupted their Brexit response. 

However, a significant finding is that almost one fifth (19%) are actually thriving in a post-Brexit economy, with 35% of electronics, computer and telecommunications companies enjoying a positive outcome. Preparing early proved essential, allowing these companies to take a holistic approach by working closely with experts who understand the complexities of global trade and by putting solutions in place for customs declarations.

The research findings underline that with the next phase of Brexit changes – an end to deferred import declarations from July 2021, and safety and security filings required from 1st January 2022 — there are lessons to learn about the value of preparation and acting ahead of deadlines. When it comes to successful global trade, planning is not just essential for compliance – it makes a tangible difference to successful business operations. 

“Brexit has thrown many businesses into a spin, but the companies that prioritised Brexit preparation are thriving and provide a best practice blueprint that the rest of the market can now follow,” said Pol Sweeney, VP Sales and Business Manager UK, Descartes. “Our research highlights that with the changes due from July through to January 2022, early preparation is, once again, crucial to avoiding expensive disruption.”

For the full research findings, see Descartes’ Brexit Realities Report and for additional Brexit resources visit Descartes’ Brexit Resource Centre.

The value of global trade insights in navigating COVID-19 supply chain disruptions

By Mark Segner, VP Global Sales, Descartes

The Coronavirus pandemic has exposed the fragility of the modern supply chain, as companies struggle to acquire the products and raw materials needed to keep revenue flowing. With many businesses relying heavily on a limited number of trading partners, many located in hard-hit areas like China, the scale of the supply chain disruption has been a wake-up call. 

Pummeling the Bottom Line

COVID-19 shockwaves are being felt around the globe, with one in six companies adjusting revenue targets downward. Figures from the Office of National Statistics revealed that 72% of businesses in the UK reported that they are exporting less than normal, and 59% of reported that they are importing less than normal due to the impact of Coronavirus. 

According to a survey by the Institute for Supply Management (ISM), nearly 75% of companies reported supply chain disruptions due to the COVID-19 outbreak, with lead times doubling and delays compounded by a shortage of air and ocean freight options. A recent survey of Descartes customers also found that 31% are looking for alternative suppliers, and their usage of tools to find alternative supply sources has increased by 21%. Given the sheer scale of the disruption, many different types of businesses are unlikely to have a plan in place to address supply disruption from China and other countries.

Re-thinking Sourcing

With the global supply chain often more complex than many comprehend, very few organisations can trace their supply chain beyond their Tier 1 suppliers, and many are uncertain of the location of their second and third-tier suppliers. To fully understand supply-side risk, Deloitte notes that advanced digital solutions are “generally required to trace supply networks reliably across the multiple tiers of suppliers.” Indeed, manufacturers, retailers, and distributors are in uncharted waters as they race to identify new supply sources.

Global Trade Insights Guide the Way

With the daunting task of navigating the rapidly changing global trade landscape, where should your organisation begin? Actionable global trade data is your lifeline for supply chain resilience. In the face of COVID-19 disruptions, global trade intelligence solutions can help businesses swiftly find alternative suppliers in a concise three-step process:

  1. Identify potential sources; Know the market to make better sourcing decisions

A sophisticated global trade intelligence solution can assess market dynamics, revealing the impact of both the Coronavirus and recent tariff changes on specific commodity imports and exports by mapping the global flow of shipments and identifying recent volume shifts. Previous shipment volumes reveal which suppliers have capacity for your sourcing demands, while bill of lading (BOL) data helps you easily identify names, addresses, and contact details for each supplier.

2. Analyse costs; How much will it cost to do business?

Given the slowdown many companies are facing during the pandemic, curtailing costs is top of mind. Global trade data technology can analyse potential suppliers to calculate the total landed cost of doing business with them, including duty spend, variable and fixed taxes, shipping costs, and insurance costs. With international trade insight, businesses can also identify favourable Free Trade Agreements (FTA) or other preferential mechanisms to help maximise margins.

3. Vet potential trading partners; Limit liability and brand damage

The vetting process is vital for avoiding exposure to sanctioned parties but, given the fluidity and sheer size of restricted party lists and the rabbit hole of shell companies, obtaining an accurate view can be extremely challenging.

With a global trade intelligence solution, businesses can quickly screen potential suppliers to determine if the country or vendor are subject to any restrictions or sanctions from the government. Compliance vetting is crucial for avoiding fines and penalties but also ensures your company brand remains untarnished. 

Beyond COVID-19

Access to actionable trade insight is critical to developing a proactive supply chain response to the coronavirus and emerging from this pandemic as intact and profitable as possible. Sophisticated global trade intelligence solutions use shipment data from across the world to model trade flows globally, helping companies rapidly identify, analyse, and vet new sourcing locations. With the right approach, businesses can mitigate the impact of COVID-19 on supply chains and also strengthen and add resiliency to their logistics operations going forward.

Making tomorrow a better world in logistics

By Michel Waterschoot, Sales Manager – Southern Europe, Northern Africa, Middle East, Descartes

The health crisis that we are currently experiencing, as well as its financial and economic consequences, should not mean we lose sight of the opportunities that can be leveraged today to help businesses continue growing and developing. This situation should be used as an opportunity to identify weaknesses and design innovative solutions, sharing feedback that is relevant for everyone involved so we can better prepare for the future. 

Maintaining levels of satisfaction

In food distribution, volumes have exploded. With people confined to their homes, consumers have used ecommerce for their daily shopping more than ever before. For some players in the sector it was suddenly necessary to absorb exceptional levels of increased demand. However, it comes at a cost, as businesses must continue to satisfy long-standing customers – in terms of delivery times, slots, product availability – while meeting the demand of new and existing customers.  With this increased and unprecedented influx of orders, demand simply cannot be met under the same conditions as before. The customer relationship is therefore called into question. The retailers’ objective is, if this type of critical situation was to reoccur, they need to be able to control the level of service delivered, in a way that reduces the risk of losing historical customers while attracting new ones. 

The health crisis can lead to accelerated digitalisation

Another shift that we have been able to observe in connection with the COVID-19 crisis is that some companies who were until now very reserved about the use of new technologies, are now reconsidering their options. To limit the contagion of the disease, governments around the world have encouraged the rollout of health measures that reduce contact between people, but also the exchange of physical documents, such as proof of delivery, CMR, invoices and more. Companies therefore had to put in place alternatives to paper regardless of their concerns, for instance with delivery drivers. Their route planning was turned upside down and many were no longer in their usual geographic area as drivers had to stretch capacity to meet the consumer demand. Without their usual paper routing processes they had to use the GPS of their mobile phone to find their way in some cases. In the future, they will undoubtedly be less reluctant to use dedicated technological tools adapted for this, such as smart route planning software. This health crisis may therefore have helped to move along the digitalisation of processes that are still too often paper-based.

Combining deliveries offers benefits for all

In transport, there were around 40% fewer heavy goods vehicles (HGVs) on the roads in April and May. Logistics managers must respond to delivery requests even if the volumes are insufficient and the trucks have to run with a light load or empty on certain routes. This can increase the average cost of delivery for the transporter, by up to + 73% per tonne / km in long distance transport. These figures clearly argue the case for combining delivery efforts and collaboration between couriers, transporters and shippers alike to pool personnel, stock, storage facilities and more. These initiatives have so far been limited across the UK and France for example, no doubt because of the problems around co-responsibility but also for cultural reasons. However, the current situation will help to change mentalities on this, and the promise of the potential benefits that can be leveraged will override these initial concerns. This would be good news in terms of global optimisation for companies, but also in terms of ecological impact.

The importance of good transportation management

Many European shippers subcontract their transport of goods but given the current climate, one could wonder if the companies which control their transport of goods do better than those which entrust it entirely to service providers. With a fleet of its own, shippers who keep control of their flow of goods, through specific contracts with their carriers, get more responsiveness and flexibility, precious in difficult times such as these, especially with regard to the last mile. Shippers can therefore now question their fleet management and find the right balance with their service providers and internal teams in order to get a balance and a transport management system that provides them with the visibility and capabilities they need.

Faced with this critical situation, many companies will encounter or are already experiencing difficulties, potentially jeopardising their activity. However, it’s clear this crisis can also generate positive results by rethinking processes that were undermined during this period. The impacts on the sector are, and will be, numerous, putting even more tension on each of the logistics links. We must observe and analyse the present to make tomorrow a better world.

The Importance of Supply Chain Resilience

By Anne van de Heetkamp, VP of Product Management GTC, Descartes

Acknowledging potential weaknesses in your supply chain before they are exposed by elements beyond your control is of critical value. With current events in mind, managing future supplychain disruptions will be an integral component of corporate strategy.

Calling it Supply ChainResilience, Supply Chain Disruption, or Business Continuity Management (from the ISO 22301 standard) does not affect the necessity of having strategies in place that may make the difference between following or leading in a disrupted economy, and even between surviving or folding.

To identify potential soft spots, a review should not be limited to a single product flow or single supply chain element. For any company, the next big disruption does not have to be a pandemic; it can be something minuscule on a global scale yet have the same devastating effect on the ill-prepared, in particular trade lanes or in a particular industry. Unpredictable is not a reason to be unprepared. Creating supply chain resilience is a holistic exercise that involves more than just a few savvy logistics people. HR, finance, compliance/legal, to name a few, are all stakeholders in a healthy case of business continuity management.

How then to build a strategy? Like any other strategy, the process seems logical: review, assess, and mitigate. In this particular case: 1) review your trade lanes, products, and materials flow by matching them against risk categories (i.e., labour, business risk, global trade, nature, and materials), 2) assess risks for each combination, and 3) mitigate risks by either changing behaviour now or planning for alternate sourcing options should the anticipated risks become reality.

Trade Lanes and Risk Categories

The relevant components to review within the supply chain include the importing and exporting country or countries, the manufacturing locations, the finished goods, and the raw materials. Ideally, for finished goods and materials, the associated Harmonised System (HS) codes are made available. Scratch what does not apply and move to the following step where each of the ‘inputs’ is categorically reviewed.

As mentioned, this should not be an exercise limited to supply chain professionals. For example, labour risks can be associated with the likelihood of strikes, wage volatility, and the availability of appropriate labour resources—not necessarily areas that keep the supply chain brain occupied every day.

In similar fashion, other resilience elements expand across different areas of expertise. Business risks relate to cybersecurity, corruption, counterfeit products, and the chance of entering into business with bad actors that are on any of the denied party lists.

Global trade accounts for the compliance requirements related to the shipment of goods (i.e., licenses, documentation, permits, etc.), associates the products with the various duties and taxes, and identifies if Free Trade Agreements (FTA) apply and how to qualify for preferential treatment.

Arguably the most unpredictable, but not the least expected risk to account for, is nature. It’s important to identify the various kinds of disasters that may hit: natural hazards, pandemics/epidemics, flooding, earthquakes, hurricanes, volcanic eruptions, landslides, or drought can all play parts.

Lastly, consider materials. Understanding the market comes with insights into scarcity, sourcing locations and price fluctuations.

Risk Assessment

Risk assessments match the input with the risk categories. For example, how vulnerable is the manufacturing location when it comes to labour regulations, corruption, or flooding? Is there an FTA in place that could potentially lower the import duty burden? Where in the supply chain can a cyberattack be most expected? In short, some homework is in order to create a thorough risk profile.

For many components, the sources are readily available, such as the Corruption Index at transparency.org, labour statistics on Statista or NationMaster, or duty rate information from the various global trade content providers (or the WTO).

Building Resilience

As with cyber-security risks (PEN tests) or a regular laptop virus scan, supply chain risk assessments will point out the components that need immediate attention or, in this case, are a high priority for alternate sourcing or routing options. It’s then time to build that resilience.

Look for options by analysing the market and trade lanes. Mine import and export data to identify alternative sources for goods and materials, even manufacturing locations. Map out alternative routes for products to get where they need to go. Document the reasonable options and share with as many people as possible—preparedness is of course an all-inclusive strategy.

Next and where possible: test run! Re-route shipments temporarily or source occasionally from a new supplier; in other words, make sure the alternative options are viable. In addition, communicate with external sources that would be part of continuity plans. Make them aware they are part of these plans; put people or suppliers on a retainer and try to agree on terms before disaster strikes so the projected costs can be anticipated better.

Lastly, keep those alternate plans up to date; otherwise, it may be too late to create and execute on alternate alternative plans.

Three challenges to delivery efficiency during Covid-19

Andrew Tavener, Head of Marketing at Descartes, outlines the impact that Covid-19 has had on ecommerce, addressing the three main pinch points for delivery service that have been caused due to a surge in demand, and how they might be overcome...

The current Coronavirus pandemic has presented challenges for every industry, organisation and individual across the world. In particular, the increased pressures that have been placed on ensuring efficient deliveries; to stores and to homes – have never been experienced before. With the Government placing the UK on Police-enforced lockdown, not only has panic-buying ensued, but with the public unable to purchase items from stores – ecommerce demand has seen huge growth, with a resultant exponential increase in the number of home deliveries for all types of goods. So what are the main pinch points for delivery that have been caused by the crisis, and how can they be addressed? Andrew Tavener, Head of Marketing at Descartes, explains.

Delivery to store

In light of panic-buying and stockpiling caused as a result of the outbreak, many supermarkets have struggled to keep up with demand and keep shelves stocked. We’ve already seen certain measures come into effect to support retailers, such as the relaxation of the enforcement of the EU drivers’ hours rules, as well as changes to MOT testing requirements on commercial vehicles to keep deliveries moving. But while these initiatives will all contribute to the overall effort to streamline delivery to stores, with the temporary lack of regulated checks, implementing vehicle safety technology to make sure vehicles are roadworthy and drivers are safe when they go out is more important than ever before.

Additionally, the government has announced that it will be temporarily relaxing elements of competition laws to allow retailers to work together and share resources to take some pressure off of supply chains; sharing stock data, pooling staff, delivery depots and vans, as well as coordinating opening hours to allow for shelf stacking time. When it comes to sharing delivery capabilities, an online, remote, centralised system is essential, so that everybody can access it in order to provide maximum visibility and capitalise on technology to get more out the existing resources in place, as they come under increasing pressure.

Crucially, supermarkets are now closing overnight to allow for deliveries and stacking to take place. This is where dock appointment scheduling becomes a critical component, to be able to manage demand in line with resources and capacity, to prioritise deliveries and create a foundation for better carrier/supplier collaboration – addressing this significant pinch point during a critical time can help to streamline the delivery process. One well known supermarket is currently coping at four times its peak with the use of Dock Appointment Scheduling, demonstrating how effective the tool can be.

Home Delivery

Add to all of this the growing concerns over the delivery driver shortages, especially as many may have to start self-isolating depending on whether they experience symptoms or not, the use of technology to optimise delivery efficiency has never been more important.

Steps have also been put in place by delivery companies relating to the actual delivery at the addressees’ homes, including leaving the goods in a specific place and not requiring a signature from the person accepting the item for proof of delivery.

A routing and scheduling solution that continually assesses the resources available, versus actual visibility throughout the supply chain, from initial collection through to the last mile of the home delivery process, offers the opportunity to maximise operational efficiency. Integrated telematics and mobile data communications provide increased visibility for the fleet manager and consumer, as they can see in real-time, exactly where a vehicle is against the plan and route set out by the scheduling software. This added insight allows transport operators to add or amend jobs to avoid disruption, such as traffic, as well as send automatic updates to the customer about any changes to their delivery. One well known pharmacy that relies on semi-retired drivers – those at higher risk to Coronavirus – is coping with a 15% absence rate with the use of routing software, demonstrating how the technology is enabling the pharmacy to keep up despite driver shortages.

Moreover, in light of temporary changes to drivers’ hours law enforcement, by combining digital tachograph analysis and reporting with driving licence and driver CPC verification with the DVLA, as well as digital driver vehicle safety checks, all in one platform, operators can practice proactive compliance management to underpin optimisation of fleet efficiency. Operators need a simple and convenient way to stay on top of their compliance requirements, especially as more changes are likely to come into effect as the situation unfolds.

Growth of ecommerce

The Coronavirus crisis has meant that retailers have had to go back to the drawing board when it comes to forecasting. For example, despite warmer weather approaching, comfy tracksuits are booming as people are staying at home, rather than purchasing evening wear or prom dresses. Home and garden, DIY and workout gear is also seeing a surge. While retailers can prepare for peak-periods such as Christmas, many are struggling to cope with this unexpected surge in demand.

With the public turning to online delivery during lockdown, businesses that have not had an online presence have realised that given the current state, this could mean the difference between surviving and going under. Even for those businesses with ecommerce in place, they have likely never had to deal with such an unprecedented crisis we are currently facing.

Primark, for example, has no online business to offset its lack of in-store revenue, now all of its 189 UK stores have closed. Estimates calculate the lost sales at Primark to equate to about £85M of gross profit, even before store closures. But all is not lost for those retailers that have not yet set up an ecommerce channel. With rapid turnaround remote solutions, warehouse management software can be deployed without the need to physically visit a site to get up and running. As long as warehouse facilities are available, businesses can deploy a logistics platform in three to four weeks, not months.

Moreover, with the likelihood that businesses will see more staff shortages as increasing numbers of workers will need to self-isolate, an efficient way of picking, packing and shipping is essential to keep up with increasing demand. And as consumers have no choice to turn to online shopping methods, it’s also likely that many will continue with online shopping even after the pandemic is over – especially if they have received a good experience. Retailers need to be prepared for the shift in consumer habits to not just be a temporary change in operations.

With technology that provides continuous background optimisation of resources, operators can get more out of their existing resources. Drivers and the public can be kept safe with real-time updates on delivery ETAs and mobile applications for proof that your goods were left in a safe place or outside your door for ‘contactless delivery’. These are testing times for every business, but those that can adapt now and capitalise on technology that can unlock valuable efficiencies will be the ones that will come out the other side stronger and in a better position to ride the wave of future demand fluctuations.