How Does Retail Optimize 3PL for On-Time Delivery During the Festive Season?

A survey conducted by MiQ explains that Southeast Asian regional retailers can expect busier business activity than usual this holiday season. In addition to the survey, a report from inMobi entitled ‘The 2022 Indonesia Holiday Shopping Guide’ also validates that 8 out of 10 Indonesians plan to increase their holiday spending or spend the same as last year.

Using third-party services (3PL; Third Party Logistics ) to measure increasing order volumes will be an obvious choice for retailers. However, while outsourcing delivery services is a great idea, managing them can be a tricky challenge. Let’s see how retailers can make the most of this partnership.

Ensure Delivery Reliability

Delayed deliveries, especially during peak seasons, are a big concern for eCommerce providers . Partnering with a 3PL can address this challenge effectively. Since each 3PL provider is responsible for meeting certain specific SLAs ( Service Level Agreements ) for the types of delivery they offer, this significantly reduces the possibility of delivery delays during busy periods.

Logistics service partners reduce risks associated with shipments by leveraging a network of partners to make deliveries if one of them fails to deliver as expected. Businesses can streamline shipping operations for different regions and delivery types by working with multiple carriers.

It also provides the flexibility to partner with logistics providers by measuring them on parameters such as first attempt success rate, on-time delivery, delivery accuracy, etc., as well as adaptability to business needs such as specially treated or temperature-controlled delivery services. , and other types of delivery.

Choosing the Right Logistics Partner

The main thing for any business to do is to target the best logistics service provider for their needs. Prioritizing data over bias and manual decisions provides better references. The intelligent logistics management platform based on AI and automation technology empowers businesses to automate 3PL selection based on cost, serviceability, distribution network, expertise, first trial delivery success rate, customer SLA, etc., as well as based on several other parameters to run on the same day , the next day, or another order fulfillment window. Because automated decision-making removes the guesswork and speeds up allocation and other processes, it increases on-time delivery by 24%.

Optimize Utilization of Own Fleet and 3PL

Allocating tasks between 3PLs and own fleets can be time-consuming and laborious. However, there may be cases where delivery can be outsourced while the fleet remains idle. An underutilized fleet is a gateway to increased operating costs.

Businesses can also prioritize their own fleet and logistics partners to improve operational efficiency. The intelligent allocation engine assigns shipments based on payment type, SKU ( Stock Keeping Unit ) type, invoice value, weight, order volume, vehicle type and other things. Capacity-based allocation allows businesses to plan trips several days in advance. Retailers can get a clear picture of their own future fleet capacity based on customer SLAs, and can improve logistics planning.

Ensure Greater Operational Control

Outsourcing of logistics to third parties means businesses lose a certain level of operational control. Visibility over processes becomes increasingly blurred as 3PL partners further collaborate with other logistics providers to make deliveries. The intelligent logistics management solution offers a unified dashboard that enables businesses to manage, track and monitor the operations of multiple logistics partners in a single window.

NDR Standardization to Simplify Tracking

While outsourcing systems allow businesses to save time and resources, each 3PL may have its own interface technology, which evolves over time, making it difficult to track and adapt to these changes, for example, having multiple terminologies regarding status non-delivery reasons (NDR) or non-delivery reasons.

Combining related terminology under a single heading can simplify problem statements for retailers. This helps them to understand and validate non-delivery reasons with customers.

Reduce RTO

Return to Origin occurs due to inaccurate addresses, delivery delays, poor scheduling, and the absence of customers at the time of delivery. In this system, real-time tracking minimizes return-to-origin events in a number of ways. The system triggers an alert to the consumer with a live tracking link and ETA ( Estimated Time of Arrival ) information.

This increases the likelihood of the customer being present at the time of delivery and increases the first try delivery rate. Consumers can also request to reschedule the delivery according to their wishes. All of these features improve customer experience by 64%, reduce returns by 18%, and lower logistics costs due to retries.

Integrated Customer Communications

Partnering with multiple 3PLs also risks exposing customers to mixed delivery updates from multiple sources that may not benefit the retailer.

Logistics management tools automate event-specific alerts to relevant stakeholders. The alerts that the dynamic system generates ensure that the retailer, logistics company, driver and end customer are on the same page regarding the progress of the delivery. The tool provides a unified and characterized customer communication experience, regardless of the 3PL or logistics partner performing remote deliveries.

Catching Fake Delivery Attempts

An increasing number of drivers are using dummy GPS locations to incorrectly flag delivery statuses threatening profitability and customer experience. In addition, the inflation rate has also driven up budgets, affecting brand loyalty. The latest survey says that 57% of Indonesian respondents have tried new brands throughout the year.

Intelligent courier aggregation dashboards display and track predefined delivery KPIs ( Key Performance Indicators ). Retailers can also verify non-delivery attempts with customers, especially when the system’s suggested route and driver’s location don’t match. The feature automatically checks for riders using dummy GPS location when making long-distance deliveries. Thus, it helps catch fake delivery attempts.

Reduce IT Team Burden

The automated logistics system takes advantage of the built-in API system and reduces the burden of engineering bandwidth required to integrate new carriers. It also helps integrate multiple channels such as eCommerce portal, customer portal, ERP and others, to ensure smoother business operations and faster onboarding of 3PL providers. All of these capabilities and features can help retailers have more control over logistics operations and enjoy a lucrative holiday season.

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