If you are:
– A retail logistics person tired of marketing complaining about freight costs,
– A retail marketing person tired of logistics complaining about your need for speed,
– A CFO tired of the red ink in logistics, returns, marketing, and rent,
– A CEO with a Board who keep asking “why can’t you do what Amazon does?”,

then this article is for you.

If you’re a retailer who does not want to increase sales, customer value, and profit, here’s a video about a Cat Beach Sanctuary.

An inevitable consequence of selling a physical product is that at some stage we need to connect the product to the consumer. There is no avoiding this. Whether it’s directly from a warehouse, from a store, or home delivered, the product and the consumer need to meet.

It is not possible to do this and not require someone to outlay a combination of time and money.

There is no such thing as free when it comes to logistics.

We can optimise, we can schedule, we can consolidate, and we can cause people inconvenience. But everything comes at a cost to someone.

After working in freight for 25 years, I can confidently state that delivery to store is pretty simple. Shipping should be despatched in big consignments from big warehouses in the far outer suburbs of Melbourne and Sydney. Deliveries are either big and bulky.

Deliveries happen during business hours from large trucks. The trucks are well-utilised at despatch but will spend 99% of the rest of the day at less than capacity. This is known, accepted, and paid for. Rates are usually reasonable. It’s the cheapest way to move your stock.

Home deliveries, on the other hand, happen in a myriad of ways.

The home delivery market is dominated by a very small number of companies with a strong investment in the status quo.

Each option is a compromise of cost vs service:

– 3 to 7 days home delivery
– 2 days home delivery
– next day home delivery
– twilight home delivery (order before X, deliver in the evening)
– same day home delivery (order before X, deliver after Y)
– on-demand delivery
– come and get it yourself! (also known as Click & Collect, or amazingly, BOPIS).

Deliveries can also happen in various ways. There are options for delivering when we know the customer is home, leaving a card and telling them where they can collect their items, redirection to parcel lockers, redirection to the post office, redirection to a convenience store, or even go to the nearest outlet and pick up the purchases there.

Some of these options come at an extra cost to the consumer. All of these options are inconvenient, and none of them could be described as a delightful experience.

The key reason there are so many options is that our customers lead busy and active lives. They have jobs, hobbies, families and friends. The weather is fickle, and things happen without notice. It is not possible to have a one size fits all solution. Our customers are not the same person all the time. The customer who was happy to wait a week in February cannot possibly spend the time to go to the newsagent in June.

Another reason we have so many options is that last mile freight is hideously expensive. Whether it’s $20, $10, $6.95 or $3.10, the cost to get a pair of shoes delivered is high, especially when our customers expect free delivery on top of their % discount, 2 for 1 deal, and loyalty reward.

Unless your customer is in a rush. Customers in a rush are different.

Customers in a rush break the rules of delivery pricing. Suddenly, $15 for a $15 pair of socks seems like a reasonable price to pay. $20 for a little black dress, $8 for a packet of nappies and a tin of formula, or $15 for a bag of dog food, are a fair price to pay. A customer driven by need changes the rules.

We’ve proven it. We’ve been delivering urgent orders for over a year. And we asked consumers what they thought. We received overwhelming feedback that Australian consumers will pay for convenience.

Would you be happy to pay $15 for guaranteed delivery within 3 hours?

It’s your wedding anniversary tomorrow and you forgot. Wine and chocolates from 7-11 won’t cut it, and neither will another experience gift voucher. There’s one website where dozens of products will be delivered, guaranteed, within 3-hours.

– 57% of women aged 18-40 said yes.

It’s Tuesday at 4pm and you are stuck at work. Your partner calls to remind you it’s their mum’s birthday, and you promised to get the soap set and book from your favourite gift store. Your favourite gift store offers guaranteed 3-hour delivery.

– 69% of women aged 18-40 said yes.

It’s Friday at 3pm and the dry cleaner calls to say they have ruined your little black dress that you just had to wear tonight. There’s a store that has the dress you need, and can deliver by 6pm.

– 75% of women aged 18-40 said yes.

Those are compelling numbers.

What’s more startling is that 50% of respondents provided us with additional scenarios where they would pay $15 for guaranteed 3-hour delivery. Here’s the word cloud:

Need.

Need changes the customer’s mindset. Now it’s about “how soon?” instead of “how cheap?”. But how can you take advantage of that need without upsetting your entire supply chain?

With on-demand delivery from your store network, you’ve already benefited from the most cost-effective method of transporting your product close to the customer. Now, it’s the customer’s term to pay for the premium last mile delivery.

This is how you can disregard free delivery, remove the need to discount, increase profit, and increase customer loyalty.

This is how you can

turn Last Mile Delivery into a marketing profit centre.

And $15 seems to be the sweet spot. Much more, and customers start to lose interest. $15 strikes the right balance between customer need and ability to pay, our ability to provide the service, and our Passers’ willingness to do a delivery on their way home.

Speaking of Passers. Here’s another benefit of Passel deliveries, and one of the reasons we are unique. Our Passers aren’t couriers, Uber drivers or busy gig economy people trying to deliver Macca’s, 3 drunk execs, and then go and assemble some Ikea furniture.

Our Passers are your customers.

Our Passers are in your target demographic. And now our Passers are coming into your store, where you can offer them incentives to encourage them to buy from you while they are picking up a delivery for one of your delighted online shoppers.

As Mel from Evergreen Clothing said:

“Passel has been the perfect addition to our online offering.
My first Passel order was picked up by Passer ‘Rach’ who came in store to pick up the order and left with a $70 purchase herself!
What more could I ask for?”

Our Passers are your customers

When was the last time a courier spent $70 in one of your stores?

Our service is guaranteed.

At Passel, we offer guaranteed 3-hour delivery, 364 days a year. That includes evenings, weekends, public holidays, quiet times and busy times.

We charge a $15 flat rate. Our retail partners decide how much of that the customer pays.

If we don’t deliver within 3 hours of booking, delivery is free. If there is a problem with delivery, we replace for free.

What guarantees does your current last mile delivery company offer?

It’s a compelling offer, and one that resonates in competitive global markets as diverse as Ireland, China and The Netherlands.

So, if you are:
– A retail logistics person tired of marketing complaining about freight costs,
– A retail marketing person tired of logistics complaining about your need for speed,
– A CFO tired of the red ink in logistics, returns, marketing, and rent,
– A CEO with a Board who keep asking “why can’t you do what Amazon does?”, then Passel is the service for you.

We have a number of engagement options from full shopping cart integration to Passel Now.

If you would like to join companies like Sanity, Dymocks and Purebaby and turn last mile delivery into a marketing profit centre by providing customers with a delightful service that will encourage them to buy more from you, more often, and at better margins, contact me here.