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Want more information? Contact us to see how we can help you.
Traditionally there has always been just 7 R’s in the logistics framework for the supply and management of products and goods through the supply chain.
However, with the continued growth in eCommerce and a retailer’s reputation being dependent upon the delivery experience, customer satisfaction with delivery is vitally important and it has become the 8th R – Right Customer Experience. The Descartes consumer sentiment research showed that 23% of consumers would not order from a retailer again due to a recent poor delivery experience, while 21% had lost trust in certain retailers and 16% had told friends and family to avoid a specific retailer due to their poor experience of home delivery. (See the Descartes Research on eCommerce Home Delivery Consumer Sentiment report).
In the eCommerce world, the 8R’s of logistics are more important than ever as a way of ensuring customer loyalty and continued growth in sales.
The 8R’s of logistics as a framework for managing the flow of materials and products through a supply chain are:
Ensuring that the correct product is delivered to the customer, involves having accurate product information, tracking inventory levels, and managing product substitutions. Digital Proof of Delivery solutions scan labels on goods as they are loaded on the delivery vehicle and again as they are unloaded at the customer, ensuring the correct items are delivered and that nothing is left on the vehicle which would result in a costly second delivery to complete the order.
The right quantity refers to ensuring that the right amount of product is delivered to meet customer demand.
This might mean having the ability to forecast demand, manage inventory levels, and to adjust production levels to meet demand, but also ensuring that the right quantity of goods is sent out for delivery, while also ensuring that the same number arrive and are delivered to the customer.
The product should arrive in perfect condition when it is delivered to the customer.
This requires suitable packaging, correct handling, and storage of the products in transit to maintain their quality. If goods arrived damaged, do you have a suitable solution for recording the damages and arranging for replacements? Digital proof of delivery solutions can do this.
It is obviously important to ensure that the product is delivered to the right location for the customer. This can also refer to selecting the most efficient and cost-effective route for transport and managing the logistics of delivery. Route optimisation software will help with this.
The product should be delivered when the customer expects it, ideally, this will be a time selected by the customer that meets their needs. Delivery scheduling software will help by offering actionable delivery slots as options to the customer at the time of purchase. This is known as dynamic delivery route scheduling.
To fully manage this process and keep the customer completely informed of their delivery, a combination of vehicle tracking, and customer notifications are vital in order to monitor and inform the customer of the delivery progress.
The right price ensures that the cost of logistics is minimised while still meeting customer expectations.
It involves optimising vehicles used, transport routes, delivery schedule and continuously monitoring costs to identify areas for improvement. Maintaining a high level of delivery density will keep costs down while ensuring that goods are delivered and received at the first attempt will dramatically reduce delivery costs.
The right customer implies that the logistics process is tailored to meet specific consumer needs.
It will involve understanding the customer's requirements and meeting those needs. Being able to offer a choice of delivery slots that have already been costed and identified as ideal for an optimised delivery route and schedule will make this more successful.
All of the above, if done correctly, should lead to a positive customer experience. Descartes Home Delivery Research showed that just 16% of UK customers are satisfied with their delivery service every time with 68% having an issue with delivery in a 3-month period.
While the above 8R’s of logistics are a commonly used framework for managing the flow of materials and products through a supply chain, some logistics experts will argue that there are in fact a further four more R’s in the Logistics framework that should be considered, the additional R’s being;
Supplier selection should be based on their reliability and ability to provide the right product at the right quality on time, this may mean the supply of raw materials into a factory or the supply of finished goods to a warehouse for distribution.
The management of returns is becoming ever more important as more consumers buy online. Ensuring that products can easily be returned in a timely fashion, in the right condition and to the right place is crucial for the management of costs.
Sustainable and environmentally friendly methods of delivery are becoming more and more important as both legislation and consumers insist upon them.
The Descartes Sustainability Research recently showed that 50% of online consumers wanted environmentally friendly delivery options and that 40% would buy more food from grocers that could demonstrate the best sustainable delivery process.
Getting the paperwork correct for the movement of goods is important, for without the right details, invoices cannot be created and won’t be paid. But Compliance also refers to the legal matters of delivering goods, such as drivers’ hours and vehicle safety and logistics companies need to ensure that they get this right otherwise they risk fines and in the most serious cases can lose their Operators Licence and receive a custodial sentence.
In order to keep up with the continually expanding e-commerce market, businesses must rethink their delivery strategies and develop innovative solutions that satisfy the 8 or 12 R’s of logistics. Modern tools now enable far more precise analysis of real-time data, leading to better business decisions.
Businesses can save money on operational delivery fulfilment expenses, spend less time planning, and choose the most effective routes by implementing the latest software for delivery scheduling, route optimisation and proof of delivery, while also gaining a competitive advantage and improving their environmental credentials.
Contact Descartes now to discover how we can help you solve the 12R’s of Logistics.