Online store deliveries to customers take on average almost a day longer (3.1 days) than online stores estimate themselves (2.3 days). Most of the delivery time is spent on picking and shipping the products. These are some of the results from a study by Posti and IRO Research. The study investigated online stores’ estimated and actual delivery times, from the time an order is placed to delivery. The total delivery speed of online shopping is affected by sub-factors in the process (warehousing functions, picking and shipping from the warehouse as well as delivery to customers) and how well they have been integrated with each other.
The views of online retailers on delivery speed and its subsectors were researched by conducting telephone interviews with logistics and commercial decision-makers at online stores. Simultaneously, the actual delivery times realized from a purchase were researched with mystery shopping: purchases were made from online stores and their total delivery time from order to delivery was measured.
In the interviews, online retailers estimated that the total order-delivery process would take on average 2.3 days. They were also asked to evaluate the duration of warehouse functions, i.e. picking and sending, as well as the duration of the logistics company’s transport separately. The share of picking and sending was evaluated at an average of 1 day and the duration of the transport at 1.3 days. The majority (90%) of online stores said they take care of the picking and sending functions themselves.
However, the mystery shopping purchases gave a different picture. On the basis of these, the actual delivery time to the consumer is on average 3.1 days, of which the share of picking and sending is 2 days and the share of transport approximately 1 day. Based on the results, Posti took care of transports faster than the other researched transport companies, on average in less than 1 day.
According to Commercial Director Henrik Hahtovirta from Posti’s Parcel Services, there is a lot of potential in shortening delivery times.
“Speed is one of the most crucial selection criteria for consumers when they shop online, so developing the subsectors that affect it is important for online stores. Online stores can achieve a genuine competitive edge with fast deliveries. For instance, when consumers shop online in the evening or at night, we enable next-day deliveries to most of the Uusimaa region, and same-day deliveries in the capital region; at best, even within a couple of hours of the order. The best results can be achieved when we optimize online store processes in cooperation,” Hahtovirta explains.
Online stores plan to speed up their delivery processes
The interviews also asked how online retailers have planned to speed up their delivery processes during the next six months. Almost four online stores out of ten (38%) are planning to, at least in part, implement next-day deliveries. Almost a quarter (23%) have even more ambitious plans—they are planning to, at least in part, implement same-day deliveries. Every fourth online store (25%) is planning to speed up their product picking process.