Lesson 9 – How? – #4
Fulfil your orders
What is involved and what are the key considerations?
This lesson takes a look at the third part of the customer experience cycle – Receive. This is all about fulfilment.
Once your customer has purchased something on line you will need to fulfil the order – how well can you do this when the customer is say 3,000 miles away? .
Fulfilment is often an afterthought – the sale has been made, so the important bit has been achieved – right? – not really.
In practice delivering your goods or services to overseas markets can be
Expensive for you – and quickly erode your hard earned profits.
Time consuming for you.
Frustrating for you if not planned.
Expensive for your customer – it might be that to protect your margin you decide that you will charge your customer for the delivery, but that can make you much less competitive – according to Sleeknote.com “Nearly four out of five (79 percent) of people are more likely to shop online if they could get free shipping in 2018. So you can bet that having free delivery options is important to a good chunk of your customers and something you should offer if at all possible”.
Time consuming for your customer – your customer usually wants there order quickly – according to Sleeknote.com “Fifty-three percent of shoppers say that speed of delivery is an important factor when it comes to evaluating their online orders.”
Furthermore, “25 percent of shoppers have cancelled an order because of slow delivery speeds.”
If they’re faced with choosing between ordering from two similar e-commerce brands, the vast majority of shoppers will opt for the one that offers quicker delivery. It’s that simple.
Frustrating for your customer if not executed effectively. You can do a great job of selling to your customer, but in reality if they have a bad experience when receiving the goods or services that is what they will remember – and they won’t use you again. They want it quickly, safely and at a low (or no) cost. Clear information is vital during the fulfilment process according to Sleeknote.com “53 percent won’t go through with a purchase if they’re unsure when it will arrive.
But on the other hand, 54 percent will become repeat customers when a brand correctly predicts when a package will arrive. The bottom line here is that you want to provide each customer with an accurate delivery date and follow through with your promise”.
It is worth giving this aspect of your e-commerce operation some thought. This framework will help you with that process.
3 Key considerations when fulfilling international on line orders.
1. How? – what is the best way to deliver your product or service?
- Transfer of Responsibilities and ownership
- Administrative requirements
- Digital logistics (if appropriate)
- Personnel logistics (if appropriate)
There is a whole mini course called Logistical Considerations here on ExportSavvy that covers all of these points in some details.
2. Costs – all associated costs including:
- Costs of shipping.
- Local duties.
- the associated labour / people hours
The costs associated with fulfilment should be a major consideration as they can significantly erode profitability – There is also a short lesson on costs in the Logistical Considerations course on costs. You can take a more in-depth look at these in the Third Party Costs lesson in the Financial Considerations mini course – and you can think this through in the context of your own business by completing the Export Value Chain exercise in your toolkit
3. Customer Experience when receiving your products or services:
The delivery of the product or service might be carried out by a third party, however, the experience will be associated with your brand. Speed of delivery is not the only consideration.
- Security (if physical goods they arrived undamaged)
Time and Cost:
xsellco.com claim that the likes of Amazon and Alibaba have set the bar high and cite some strong views on customer expectation when receiving goods having purchased them on line – this makes for an interesting read and will certainly give you some things to think about:
What do customers expect from shipping in the age of Amazon?
You’ve got to keep customers happy and run a successful business, but the advent of Amazon Prime and similar services is making that dance much more difficult.
The biggest lesson from the current and previous holiday season is that shipping matters and waiting is unbearable. Even if you’re not competing directly with e-commerce giants like Amazon, your customers are going to bring the same expectations to your business. Your task is to understand these different priorities and figure out how to deliver the best experience, without cutting into your margins.
The good news? There’s research on your side to help understand customer needs and you have access to partners who can make the whole thing easier to manage.
Promise free and then fast
Your customers want shipping that’s free and fast, but they’re willing to wait a little longer to guarantee that free price. So, on your site and in your marketing, free is the promise you want to highlight to bring them in and keep them happier.
According to a survey from Internet Retailer and Bizrate Insights, a little more than half of consumers say free shipping is more important than fast shipping. Roughly 47 percent said that the two are equally important, and 2.5% say that fast shipping is more important than free shipping.
That being said, roughly 90 percent of this group said they would wait longer for their goods to arrive in exchange for free shipping. Only 1 percent expect goods like apparel or electronics to be delivered within 24 hours.
A UPS report backs up the findings of consumers saying that free is the most important delivery option and notes that 44 percent of people will choose slower shipping if it means free shipping.
The broad data tells us that free has a dominant position and is the better option to give if you can only provide one. Fast is useful, but with 2.5% saying free is more important, you can use fast as a special deal or provide the option at an extra cost and still stay in customers’ good graces.
Tackle what people see first
One sure-fire way to upset customers and lose a sale is to have a large gap in delivery-time promises and customer expectations.
Even your biggest fans will abandon shopping carts if shipping doesn’t align with their needs. As the previous reports and many others establish, this means your costs can’t be too high and that fast options must be available.
Most of today’s digital shopping carts give us cost estimates before we enter all our details. Even if it isn’t a final price, we judge the viability of the purchase by looking at the cost of this cart before the actual checkout process.
If shipping costs aren’t included, that means the customer isn’t sure of how much it will cost. You’re creating a little bit of apprehension that might push them to abandon the sale. This is especially true for price-sensitive customers: if they have $25 to spend and the cart comes up to $22.50, that’s not a lot of room for shipping costs.
You can immediately alleviate these fears by plastering the word “free” in a line above the cart’s subtotal. The goal here is to get them to click through from the cart to the checkout process.
Then they’ll enter their information, review their picks and say one final “yes,” after they have mentally committed to the purchase at least three times: 1) adding items to the cart, 2) looking at the cart before checkout, and 3) entering information at checkout.
After this, you can offer free shipping and provide pricing options for speedier delivery.
Do I have to promise free two-day shipping?
Amazon Prime is always in the back of any e-commerce entrepreneur’s mind. The biggest worry is: do I have to match their shipping promises?
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In most cases, you don’t. This is especially true if you’re a smaller storefront or working in a niche area. A little more than half of businesses expect two-day shipping all the time, while consumers have preferences that run a larger range.
In this case, you’ll need to do some research for your specific category. For example, most consumers who buy housewares like linens and décor expect goods to be delivered in three to five days, though they’re willing to wait into the six to 10 range. On the other hand, cleaners and similar household goods have about 30 percent of people willing to wait three to five days, but roughly 29 percent want goods delivered either next-day or within two days.
Another bit of good news is that consumers who want faster shipping times, especially those asking for goods within a 24-hour period, are willing to pay a little more.
How do e-commerce brands get there?
Now that you know customers want free and fast shipping options, you must figure out how to offer it. If you’re a small shop trying to do it on your own, that could be a problem. If you’re a growing brand, you have more options but will need some serious negotiation skills to make it all happen.
The two chief ways brands like yours are stepping up to meet customer demands are moving operations to their own warehouses or choosing a shipping partner who has guaranteed rates and delivery options.
Setting up your own warehouse is a complicated process that can involve renting new space and purchasing equipment, as well as warehouse management software, for order management and fulfilment. You’ll need a larger team to monitor sales and delivery options, while also maintaining equipment.
One surprising part to many is that you don’t automatically get better shipping rates from carriers like UPS and FedEx. Individual businesses must negotiate with carriers and show their shipping volumes if they hope to secure better-than-normal rates. One downside is that these negotiations are getting more difficult because of the meteoric rise in e-commerce competition.
Later in the course we will take a look at how you can use partners to fulfil a number of these operations for you.
How convenient is the fulfilment? – this can take a number of guises:
1. Physical product delivery – will it arrive at a convenient time? Is it easy to receive? Is it easy to get into the right place? etc.
2. Technical delivery -is it easy to install and commission – how much disruption will its introduction cause? – this is a very common reason for customers not buying.
3. Service delivery – how will the service be delivered? – will it be easy to implement? Will it take up much staff time etc.
4. Digital delivery – how easy is the product or service to download and integrate ready for use?
Some key considerations for your packaging:
Is it robust enough to ensure that the product or service arrives safely and undamaged?
Is it cost effective?
Is it the right shape? – can it be stacked / transported with minimal volume impact. Some considerations here:
- Minimising parcel rate volume
- Maximising the number in a container for bulk delivery.
- Will it fit onto a standard pallet?
Is it portable? Can it be easily handled?
Is it easy to open? – consider the experience of receiving and opening the parcel.
Is it attractive?
Is it eco-friendly? – reusable / biodegradable.
Is it reusable – if the customer wants to return the product.
Does the material conform to local standards in your target marketplace? – certain countries have strict guidelines on the composition of packaging.
Do the labels conform to local standards in your target marketplace? – do you have the right information on the packaging?
Something to consider here – remember from an earlier lesson on the course, this is not just about the packaging itself – but how you package the product that you are selling. Can you make it smaller? – Do you need to ship the entire product, or could you add some value locally in country?
There are a number of excellent packaging consultants and suppliers who can help you with this. A good source to identify these is upwork.com.
From your perspective the fulfilment should be:
Not too time consuming (added cost).
Conforming to local shipping regulations.
From your customers’ perspective the fulfilment should be:
Free of charge or low cost.
The key consideration – how can you deliver all of this when you may be 3,000 miles away from your customer?
The chances are that YOU can’t – however others can. The good news is there is plenty of help out there and it does not necessarily involve high levels of investment.
Earlier in this course we mentioned you completing the e-commerce flatplan (which you will find in your toolkit here on ExportSavvy) – we would recommend that one of the sections for you to complete is the fulfilment section – list out exactly what is involved in providing the aforementioned customer experience – then you can look at who can deliver that most effectively – can you do this from within your in house team or will you find third parties to do this for you? .
Later in the course we will look at how you might get others to complete these tasks for you.
Your customer have received their goods – now they have to use them, are you making that easy for them? The next lesson considers this.
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