The e-commerce divide: retailers and consumers not on the same page

At a time when retailers’ e-commerce operations are under more pressure than ever before in Australia, research has uncovered a disconnect between the online shopping delivery options retailers think are most popular, compared with actual consumer preferences.

The survey of 2,000 Australian consumers and 100 large-end retailers, found that almost 50 per cent of retailers said that Click and Collect in 2+ working days was the most popular delivery option amongst customers, which contrasted with only 6 per cent of consumers agreeing that this was the most useful delivery option.

A further 31 per cent of retailers stated that same day home delivery was the most common delivery choice with customers, however, only 8 per cent of consumers consider this to be the most useful choice.

The research found that distribution centres (DCs) are bearing almost the full brunt of the increase in online orders, with only 9 per cent of retailers saying they fulfil online orders from retail store stock. Most retailers deliver from a regional DC using their own delivery vehicle, 28 per cent deliver from a regional DC using a courier and 28 per cent direct from a supplier.

Raghav Sibal, Managing Director for Manhattan Associates, ANZ said findings suggest that the delivery options retailers are offering today are not in line with consumer expectations, leading to unnecessary pressure on already stretched supply chains to deliver goods quicker than consumers actually expect or need them.

“COVID-19 has created an incredibly difficult business environment for many Australian retailers, which means they can’t afford to be carrying any needless costs, such as paying extra to deliver products faster than consumers actually expect,” he said.

Raghav said this is the perfect time for retailers to be using this as an opportunity to pivot their in-store workforce to fulfil online orders, which would help to ease the pressure on warehouse operations and also add flexibility and cost-effectiveness by fulfilling orders from the location closest to the delivery point.

“Retailers can’t sell what they can’t see, and this concerning lack of stock visibility, especially when the bulk of retail activity is currently online, is risking lost sales opportunities,” Raghav said.

Retailers indicated that their inventory visibility had room for improvement, with only 6 per cent of respondents saying they have accurate inventory insight 100 per cent of the time. The biggest group of retailers said they only have visibility less than half of the time.

“This pandemic is a reminder of just how important it is for retailers to have real-time insights into their supply chain operations and product inventory, so they can stay informed and react quickly to sudden changes in the market,” Raghav said.

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