The 'last mile' problem in logistics is when you miss a package delivery, causing a headache for delivery companies because it increases delivery costs. How is UPS countering this problem?
The e-commerce boom in Asia has placed a spotlight on fulfillment and final mile delivery capabilities. It is crucial for e-tailers to fulfill orders and deliver a good end-to-end customer experience - ensuing purchases arrive quickly and in good condition, as well as having a robust returns process. These all contribute to a higher customer satisfaction and long-term retention.
UPS has over 107 years of experience in ensuring the safe, secure and speedy door-to-door delivery of shipments. We've taken up the challenge of solving final mile delivery by enhancing our retail solutions through our learnings working with customers globally, and our investments into technology.
When these learnings are combined with industry insights gained from the UPS Pulse of the Online Shopper study, it is clear that the consumers of today value flexibility and options. As such, we continuously look into strengthening our network of UPS Access Point locations to aid our customers in improving the final mile shopping experience.
UPS Access Point can be integrated seamlessly into existing supply chains to enable fast, efficient, and convenient parcel retrieval from a retail outlet such as a newsagent or grocery store. Consumers have the option of collecting or dropping off a return at a time that best suits them.
Most recently in Singapore, we partnered with Shell in order to allow customers to pick up their packages anytime at 7-Eleven outlets at Shell petrol stations across Singapore. This is mutually beneficial as it provides a higher level of convenience for consumers, and is also an efficient way for us to deal with missed deliveries.
Free shipping has also been cited as a key factor in driving online shopping. How exactly is UPS helping to drive down shipping costs for consumers?
The growing demand for free delivery may not always negatively impact a retailer's business. The "UPS Pulse of the Online Shopper" survey revealed that 92 percent of respondents will actually take action to qualify for free shipping, such as placing additional items in the cart, searching for promo codes online and joining a loyalty program. Specifically, nearly half of respondents will add items to their shopping cart in order to qualify for free shipping. This presents a substantial opportunity for e-tailers to incentivise their customers to commit to a greater spend.
It is also beneficial for retailers to note that consumers often times do not expect their purchases to arrive right away when offered complimentary shipping. Instead, they are usually more patient, with the majority of them willing to wait an additional 3 days for domestic delivery. Therefore, retailers can offer a variety of paid shipping options that consumers can opt for based on the urgency with which they need their products delivered. Accordingly, we are working closely with businesses to develop strategies that help manage cost pressures, while still giving them a competitive advantage that allows them to build customer loyalty.
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