It’s Time for Enterprises to Rethink Their Customer Delivery Strategy
While couriers have long been used for local or “last mile” business-to-business deliveries in the US, and for consumer deliveries in densely populated areas of the world such as Europe and Asia, the average American, when it comes to delivery, thinks only of big-name players such as FedEx and UPS. Or maybe they think of names, such as Con-way, that they saw on the side of a semi-trailer truck. Couriers, however, don’t only do next-day local delivery at rates lower than FedEx or UPS. They are able to provide a wide range of service levels for (quite literally) any product a business or consumer purchases. Because of their size and focus on a limited geography, couriers can do things that large national carriers cannot.
First and foremost, they can tailor their service based on the shipper’s desires, whereas national carriers cannot for reasons of efficiency and scale. Are you looking for same-day delivery of headphones from a retail storefront to a consumer, scheduled delivery of pharmaceuticals to drugstore within a 30-minute window, or two-person delivery and installation of a washer and dryer with removal of the old one? The local delivery and courier industry has these unique service levels covered.
It’s time that shippers reevaluate their delivery strategy, because technology adoption and advancement have solved the local delivery and courier industry’s traditional shortcomings, making couriers a better alternative to the national carriers or even a dedicated fleet. This will enable shippers to provide a better customer experience:
• Geographic Coverage – With a national carrier, a shipper only needs to work with a single company to offer delivery in the top 25 markets. Since couriers focus on a limited geographic area, a shipper looking to have a national local delivery network would potentially need to work with several dozen couriers. More transportation providers means more points of contact and potential failure, more parties to interface with your supply chain, and a generally more complex operation.
Many shippers choose to reduce what they have to deal with by working with a managed transportation services (MTS) provider that specializes in local delivery or “the last mile,” such as RR Donnelley or Ensenda. A growing trend among progressive companies that do not want to outsource — for example Restoration Hardware — is to use technology that streamlines communication and collaboration across internal teams and with their couriers, minimizing the need to scale using people. Until recently, these companies had two choices: develop and maintain software in-house, which was the approach most long-standing users of local delivery chose, or significantly customize existing transportation or fleet management software (TMS or FMS) and integrate it with customer relationship management (CRM). However, over the past few years, a segment of local delivery software specialists, which includes us (Grand Junction), has emerged in the supply chain management software industry.
• Visibility – When a retailer, for example, uses a national carrier, their customers get real-time, detailed tracking information throughout every step of the delivery process. Historically, couriers have struggled to provide anything other than proof-of-delivery, and even then up to 48 hours after the delivery’s completion; however, technology has enabled couriers to provide a competitive customer experience. Through the adoption of mobile technology for drivers and the emergence of sophisticated dispatch software, couriers have the information to manage their businesses better and provide FedEx- or UPS-like visibility.
A major challenge for shippers comes when they need to actually gather and present courier-provided information to their customer, or even make it usable internally to monitor and manage their couriers. Quickly it becomes apparent that the shipper’s IT team has a lot of work in front of them not only to build courier integrations, but also to maintain them. Unfortunately, many software providers, even the well-known TMS providers, don’t manage these integrations as a part of their solution, requiring companies to turn to EDI vendors. Grand Junction does, however, have preexisting integrations with >600 couriers and tools to monitor and drive scanning compliance, which makes the data usable and complete.
• Quality – The local delivery and courier industry long had a reputation for being low quality because it operated in an extremely low-cost and unsophisticated model. Whereas the national carriers hired full-time drivers and invested in training and technology to help them perform better, couriers did everything they could to keep costs low, from using independent contractors, who regularly came and went while working for multiple companies, to running their business by phone and paper. It’s not surprising that quality suffered. Today the industry is very different. The same technologies that have addressed the visibility challenges have given couriers information to better monitor driver performance and quality.
Shippers, however, still need to monitor quality and work with their couriers to achieve the customer delivery experience they want. Unless the vehicle has a recognizable name on the side, a customer is more than likely to hold the shipper accountable for delivery issues. Heavy users of couriers, such as Office Depot/Max (a Grand Junction customer), recognize this is the case and use automated alerts and business intelligence on top of real-time information to proactively monitor quality and performance throughout the delivery process.
While companies such as Amazon, Restoration Hardware, and Office Depot/Max may be far ahead of their competition as adopters of couriers, the bottom line is that technology makes it possible for any company to enjoy the advantages couriers have over the large national carriers without having to make hard trade-off decisions. Now is the time to reevaluate your customer delivery strategy and consider couriers. As a result, you can improve customer satisfaction and have the ability to implement same-day, storefront, scheduled, and two-person deliveries, all while saving money.