Delivery commitments biggest challenge for small online retailers

New research reveals delivering goods within expected timeframes is the most prevalent online challenge for eCommerce businesses this financial year, and a larger proportion of small online retailers rank this issue higher than eCommerce businesses in general.

“Keeping up with commitments to deliver to customers on time” came up as the leading challenge, with 63 per cent of online retailers putting it at #1, whereas 69 per cent of small businesses in the sector had it as their top challenge.

The research, carried out by parcel delivery service CouriersPlease (CP), who delivered nearly 18 million parcels Australia-wide and internationally in 2017, also revealed that almost half of respondents (48 per cent) admitted they feel the pressure to deliver within shorter timeframes. More medium-sized businesses had this concern, with 73 per cent feeling the pressure to deliver goods quicker.

The third most common challenge – among 46 per cent of online retailers – was ensuring customers return and continue shopping with them.

Interestingly, while news of Amazon’s arrival caused disruption throughout the retail industry, only 41 per cent of businesses felt that keeping up with competitors promoting faster, cheaper and more convenient delivery was a challenge for this financial year. This was most prevalent among micro-businesses (44 per cent of respondents), and was consistently less of a concern the larger the business size: 36 per cent of small businesses and 33 per cent of medium-sized businesses saw keeping up with competitors as an online retail challenge.

Online retailers are also concerned about delivering a positive online user experience, with 30 per cent admitting that keeping up to date with innovation in the online space was a challenge they are facing this financial year. 30 per cent also admitted that managing the volume of customer enquiries relating to deliveries is a challenge, and this increased to 47 per cent of medium-sized businesses.

CEO of CP, Mark McGinley said, “While there is pressure in Australia’s retail industry due to the rise in eCommerce and arrival of online retail giants such as Amazon, Australia’s retail turnover rose 1.2 per cent in November last year, with online retail sales contributing 5.5 per cent of all retail turnover – the highest ever recorded.*

“With Amazon promising to deliver low prices, vast selection and fast delivery to Australian consumers, it is interesting that keeping up with competitors was the fourth most common online retail challenge for our customers this financial year.

“Instead, commitments to deliver on time and within shorter time frames were considered more of a challenge. To help our customers keep up with customer expectations on delivery times, CP is working on launching new technologies and services this year to help ease the delivery process for our online retail customers, providing shorter delivery times and greater convenience for their customers.”

* Australian Bureau of Statistics (ABS), 2017, Black Friday and iPhone X sales drive 1.2 per cent rise