In a world where online shopping has grown in popularity, retail consumers are increasingly evaluating shipping terms and delivery experiences when deciding where to shop. Getting the last mile right is critical for retailers. Poor delivery terms prevent consumers from shopping. Poor delivery experiences prevent them from returning.
To create superior delivery experiences, retailers today are most focused on reducing the cost per delivery and improving customer satisfaction.
Retailers are diversifying and outsourcing their delivery networks, partnering with postal services, couriers and gig-fleets to expand their footprints and enhance service. In doing so, they cede control of the delivery process and consumer experience.
And the last mile is not just a one way street. Retailers are heavily focused on creating more efficient online returns processes - which can be detrimental to the bottom line.
βTo create superior delivery experiences, retailers today are most focused on reducing the cost per delivery and improving customer satisfaction.β
Superior Retail
Last-mile Deliveries
Retailers are focusing on simultaneously reducing delivery costs while enhancing consumer experiences
55%
53%
45%
37%
36%
27%
25%
22%
Cost-Per- Delivery
Customer
Satisfaction
On-time Delivery Rate
Visibility & Tracking
Average Delivery Time
Sustainability
Returns
Capacity Utilization
Last-mile delivery KPIs retailers are most focused on improving
Major factors retailers claim contribute to high last-mile delivery cost
The Drivers of
Delivery Cost
59%
39%
36%
34%
29%
28%
25%
Fuel
Costs
Address
Location
Labor
First-delivery Failure
Routing
Returns
Lost Package
Elements that create a positive delivery experience β ranked, among U.S. consumers
Achieving Consumer Satisfaction
Fast delivery
Low shipping costs
Delivery tracking
Easy return process
Sustainable deliveries
Ability to select delivery windows
10%
26%
25%
38%
53%
31%
8%
2%
Average delivery time for most deliveries
among retailers, today vs. 2027
Majority of Retail Deliveries Made Within 3 Days
5%
3%
Same Day
Next Day
2-3 Days
4-5 Days
5+ Days
Same-day or next-day average delivery time today, % retailers claiming by region
The U.S. Has Room for Speedier Delivery
36%
23%
44%
Fleet types retailers use for
last-mile delivery today
Delivery Networks
are Diversifying
of retail last-mile delivery networks have become more outsourced in the past 5 years
57%
of retailers anticipate their last-mile delivery networks to become more outsourced in the next 5 years
59%
Challenges retailers have with outsourced
delivery networks, % claiming:
But Retailers Need
More Control
of retailers claim their organization needs more control of their outsourced delivery networks than they currently have
60%
40%
33%
30%
29%
26%
17%
High cost
Inaccurate
tracking
Lack of reliable information from carrier
Poor quality and customer service
Insufficient capacity
Lack of customization
Lack of standardization
Major challenges retailers experience regarding returns:
Despite Costs, ManyRetailers Offer Free Returns
% of retailers that always or almost always offer the following:
46%
32%
Free Returns
Home Pick-up Returns
Cost
Returned merchandise handling
Communication with customer
Scheduling
Carrier performance
Home pick-up
Sustainability
Carrier selection
58%
46%
38%
26%
25%
21%
20%
14%
The trust cost of online returns
Reverse
Logistics Math
Industry Statistics
* Assumes $2 shipping cost to company on standard $50 order
** Customer Care, Transportation, Processing, Discounting and Liquidation Cost
Today
2027
Retail &
E-commerce
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Sources: [1] Invesp. [2] WSJ. [3] NPR.