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While e-commerce has grown by leaps and bounds since the onset of the Covid-19 pandemic in 2020, the industry still faces its fair share of challenges, particularly when it comes to getting products from retailers to consumers. clients.
Amid a variety of ongoing supply chain challenges related to global events, the e-commerce industry continues to grapple with the high costs of “last mile delivery” – the phase in which a product is ultimately delivered to a customer’s doorstep. Package theft, environmental damage, and other issues can also hamper the efficiency of e-commerce deliveries.
To that end, many companies are beginning to implement so-called “click and collect” technology – a valuable tool that aims to streamline and improve these and other common challenges.
Should your company offer click and collect? This article will explain what click and collect technology is and how e-commerce businesses are using it to overcome “last mile delivery” challenges.
What is click and collect?
Click and collect is considered a hybrid e-commerce model – and is in fact already used by Amazon and other retailers. In this system, an individual will purchase a product online. Instead of waiting for the product to be delivered to their doorstep, the buyer will instead pick up the item in-store (in-store or curbside pickup), or they will pick up the item at another designated collection point .
For retailers with physical locations, this is relatively easy to implement. Even grocery stores offer curbside pickup, allowing customers to walk to the nearest store, scan a code, and have their items brought to you by a store employee. Of course, this is only available during store hours.
Retailers without a physical location, on the other hand, use lockers or kiosks, such as Amazon Hub lockers. No employees are present to operate these locations. Instead, the retailer places the items in an appropriately sized locker and sends a notification and code to the customer. The customer then uses this code to retrieve their item at any time.
The availability of non-proprietary lockers that various retailers or janitorial services can use is also increasing, expanding the availability of these systems to more e-commerce sellers.
Related: How to launch an e-commerce brand
How click and collect solves the main challenges of e-commerce
E-commerce businesses that use click-and-collect systems can directly face three main challenges that affect both their operating expenses and customer satisfaction.
Although less “visible” than other issues, last mile delivery is a major issue for e-commerce brands. In fact, a Business Insider report reveals that 53% of shipping costs are directly attributable to last-mile delivery, with traffic congestion, long distances between delivery locations and the cost of third-party delivery services hampering capacity. retailers to supply quickly and cheaply. – efficient delivery.
Click and collect essentially eliminates last mile delivery. Retailers can simply drop off a shipment at the pickup center and wait for the customer to pick it up. Items don’t need to go to a delivery truck for local delivery, which can significantly reduce shipping costs. Customer can get the item at convenient time.
Another source of financial loss for e-commerce retailers is theft and damage to packages. The New York Post reports that 64.1% of Americans were victims of package theft in 2021, with over 210 million packages stolen. Porch hackers aren’t the only threat – it’s estimated that one in 10 e-commerce packages appear damaged. Rain, extreme heat, and other hazards can easily damage a package left on a buyer’s doorstep.
An example of how click and collect can solve these problems comes from Mileberry, a modular smart locker system designed for both senders and receivers. As David Thompson writes for Tech Times, “The only way someone can open a cell in a Mileberry hub is with a collection code or QR code, which means thieves will have no way to seize packages and take them for themselves. This provides peace of mind for the end consumer as they can be assured that their package is safe.”
Returns are another challenge for e-commerce retailers. The National Retail Federation reported over $761 billion in returns in 2021. Retailers are generally responsible for covering shipping costs. Customers are often inconvenienced when their return is tied to a specific logistics company (like UPS or FedEx), especially when that company doesn’t have a location nearby.
Some click and collect systems are also designed for returns. They allow customers to return an item to the same locker or store where they made the initial pickup. This simplifies the process for the customer while helping retailers avoid shipping costs that would be incurred by using a third-party service.
Related: 7 tips to reduce your shipping costs
A more efficient approach to e-commerce
The increased interest in online shopping won’t do much for retailers if they can’t control costs and deliver hassle-free shipments to their customers.
By offering a system that can be used by retailers, couriers and individual customers, click and collect systems are poised to dramatically improve many of the key challenges that have continued to plague e-commerce, even s it has experienced historic and record growth.
Without relying on third-party last-mile logistics companies, retailers and brands will need to make significant capital investments to change their operating models to enable last-mile fulfillment capabilities. Click-and-collect systems mitigate last-mile shipping, package theft, and other challenges, meaning e-commerce sellers will be able to reduce costs while improving the overall customer experience in the long run.