Is Two-Hour Delivery in the Cards for Your Business?

There is little doubt that the courier industry is flourishing and that this is a great time to own a logistics company. With the rapid increase in online retail and the rising demand for two-day and same-day deliveries, retailers are demanding more from delivery companies, who are in turn benefitting from the increased influx of work.

The Figures

More stores are promising to fulfil orders in a short period of time and the number of retailers offering this is set to increase, with insiders estimating that 40% of delivery companies will offer a two-hour service in the next ten years. An even higher number of companies aim to offer same-day delivery by 2023, and in order to do this 87% will use an external network of drivers to fulfil the requirements. This is where an exchange platform really comes into its own, because filling return courier loads will be key to fulfilling these aims.

Changing Retail

More shops are designing their stores and operation systems so that more online orders can be filled quickly. A large number of stores fulfil orders from the in-store inventory, which is the only way that two-hour delivery slots can be made to work. This process has to be developed if the quick delivery slots are to become the norm.

Many retailers around the country are reducing their high street sales space in favour of incorporating an online fulfilment area in store. Not only is space needed for packaging and managing outgoing products, but the massive number of returns also requires an area for processing. Returns are set to increase, as delivery charges are done away with and the transport services become more efficient. In time returns will require an even bigger area for their processing.

This move towards an alternative kind of store set up is proof of the wide acceptance that the retail industry is heading in a different direction. This is excellent news for anyone in the business of dealing with courier loads and the knock on effect for the logistics industry is only going to be positive.

What Does the Future Hold?

Well over half of retail companies who do not offer free delivery or returns are planning to alter their systems and offer these services in the future, although many are still unsure of whether their use of omnichannel strategies are doing the job.

As with most industries, technology is playing a huge part in developing the systems and achieving long-term aims. By 2021, it is thought that around 94% of retailers will use barcode scanners for omnichannel logistics. This will mean that there is a more immediate connection with the warehouse and the systems used to manage the courier loads. RFID-enabled inventory management platforms are also set to be more commonplace in the retail world. The general aim is to connect supply chains in a more intelligent way and make the transportation of goods more efficient and more able to manage demand.

It is definitely worth considering how offering the two-hour delivery service could affect your business. All the signs tell us that the retail industry is moving towards faster delivery times and we will have to manage the increase in demand. Manage it well, offer the required services and your business will thrive.

Norman Dulwich is a correspondent for Courier Exchange, the world's largest neutral trading hub for same day courier loads in the express freight exchange industry. Over 5,400 member companies are networked together through the Exchange to fill empty capacity, get new clients and form long-lasting business relationships. 

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Author: Desiree Michels