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Christmas delivery delays risk record high in 2017

A growing shortage of LGV drivers could put Christmas deliveries at risk and contribute to predictions of a record number of parcels not arriving on time for 2017. According to the Institute of Customer Service, consumers experiencing late Christmas deliveries is getting worse year-on-year. Coupled with Christmas falling on a Monday this year, research from the institute suggests £4.4 billion worth of presents will be received late.

The combination threatens a perfect storm of pressures on retailers, who, in 2016, lost a potential of £3.9bn in sales as a result of Christmas delivery delays. Meanwhile, the FTA reports the freight and logistics sector is short 52,000 LGV drivers. With customer demand for next and same day delivery options growing, supply chains are coming under increasing strain as a result, which, this year, also has Sunday trading and delivery restraints to contend with.

A survey carried out by TLF Research revealed almost half (42%) of the 2,000 consumers surveyed spent more than £300 last Christmas with a retailer who failed to deliver on time. Missed delivery slots had an impact on customer retention, as almost three quarters (71%) of respondents said they were less likely to shop again with retailers who fail to deliver on time.

Indeed, in the hugely crowded online market, delivery options and reliability have become a key differentiator for retailers, and an opportunity to secure an order over the competition. It’s therefore crucial that the right supply chain infrastructure is in place to plan effectively in order to meet demand and satisfy the customer. Likewise, with the driver shortage showing no signs of improving, retailers need to look at other means of meeting a demand for fulfilling more deliveries within tighter turnaround times.

Retailers and operators alike must shift their attention to doing more with less. Organisations can utilise technology to leverage the efficiencies required to prosper in today’s challenging retail climate, while also countering additional factors, such as emissions charges, increasing congestion, and penalties for missed delivery slots – and, most importantly, enable drivers to do so while remaining compliant with drivers’ hours rules.

By evolving and streamlining operations with intelligent supply chain infrastructure, transport operators and retailers have the ability to plan effectively for peak events, such as Christmas, and to meet changing customer expectations. Scalable and advanced route planning and optimisation software can help transform supply chain performance and enable logistics professionals to maximise the utilisation and efficiency of existing resource. The Descartes’ Route Planning solutions continually optimises demand and delivery capacity and resources to ensure drivers are taking the most efficient routes, to conserve fuel and save time, while ensuring deliveries are never missed or drivers over-scheduled. This decreases costs, improves service, increases productivity and reduces the fleet’s environmental impact. The delivery options presented at the point of sale are realistic, achievable and costed.

Warehouse management systems (WMS) are also crucial to streamlining the whole process and to accessing efficiencies in all areas. With Descartes pixi* WMS, in-house logistics processes can be automated to streamline resource and oversee orders for efficient same-day delivery, while saving costs and reducing error margins. The pixi* WMS can leverage multiple benefits, speeding up shipping processes by 42 per cent, increasing the number of packages sent per employee by up to 323 per cent, and faster returns handling by 49 per cent.

This collaborative approach to operations is the only way to address the current challenges within the freight and logistics sector, and allows retailers and transport operators to ensure they can extract maximum capacity from the vehicles and drivers they already have. From pulling together disparate aspects of the supply chain via integrated transport management and route planning to leveraging and sharing real time data across the supply chain, Descartes solutions enable transport operators and retailers to better manage assets and achieve the ‘do more with less’ mantra.

See how we’ve helped other businesses achieve a delivery capacity increase of 35 per cent, here, and contact us for more information.