Retailers of all shapes and sizes say they will offer same-day delivery by 2025 as consumers continue to prioritize last-mile fulfillment speed and convenience, according to research from delivery and fulfillment cloud platform provider Bringg, released this week.
The supply chain tech provider surveyed 500 retailers in the United States, the United Kingdom, Canada, Germany, France, and Italy to assess the strengths and weaknesses of retailers’ last-mile delivery capacity and to understand fulfillment costs and retailers’ ability to meet customers’ fulfillment needs. They found that most need to develop a more connected fulfillment network, automation capabilities, and focus on geographically smaller, or “hyperlocal,” delivery strategies.
The results are presented in the company’s 2022 Bringg Barometer: State of Retail Delivery & Fulfillment report. According to the survey, 99% of respondents say they will be doing same-day delivery within the next three years, compared to 35% who say they are able to do so today. The survey also found that many current last-mile fulfillment models do not support same-day or on-demand delivery, however, with 36% of respondents saying they lack the technology for same-day delivery, citing real-time order visibility as the main problem, and 24% calling out the sheer distance they need to travel from warehouse to fulfillment as a primary obstacle to delivering on time.
The survey also found:
- Retailers have an urgent need for greater connectivity, but a lack of visibility and outdated technology is holding them back; 44% are managing multiple fulfillment channels with disparate technologies, and 61% cite problems with visibility into the last mile.
- The biggest pain points when it comes to scaling delivery include a lack of real-time visibility once the order is out for delivery, according to 61% of respondents; 55% called out the inefficient manual nature of the way they plan and dispatch orders.
- When it comes to pain points associated with fast and on time delivery, a lack of data is a central concern for retailers due to real-time order visibility (in this case, 51%) and travel time (49%). This problem is exacerbated by multiple delivery partners, as 26% of retailers say they are struggling with visibility when working with third parties.
- Retailers are moving away from a reliance on a single traditional carrier and are pivoting to a mix of providers to connect with their customers faster, with 55% using multiple fleets for last-mile delivery.
- Sustainability and carbon emissions are an important consideration, with 56% of retailers using fleets with electric vehicles (EVs), and one in three using bike fleets.
A third of retailers surveyed reported being confident they can respond to these and other pandemic-induced changes in buying behavior, but just under half said they are only somewhat confident they can do so, according to the report.
“The retail industry is reinventing itself and adjusting its fulfillment operations to the current market eruptions, which are paving the way for cost-effective fast fulfillment,” Bringg CEO Guy Bloch said in a press statement detailing the results of the report. “From what we’ve seen in our latest barometer report, the retail industry is highly agile, with a third of retailers (33%) highly confident that they can pivot to respond to new, pandemic-driven customer behavior. With a need for more delivery capacity, greater tech innovation and stronger partnerships with providers, now is the time for the 49% of ‘somewhat’ confident retailers to prove that they, too, can be agile enough to improve delivery speed and convenience. To get there, retailers will need to connect and automate their delivery network resources, processes and technologies, and adopt hyperlocal fulfillment as a goal for 2022.”
