Should Small and Medium Enterprises use Delivery Management Software?

To gain cost advantage and align with industry best practices.

Introduction

The pandemic has shown that taking orders online and doing deliveries to customers is a sure shot way to ensure business continuity. That is small and medium businesses like you are looking to do online sales. There are three options:

  • If you have a good scale and a wide geography to reach, invest in your own fleet and deliver orders to your customers directly.
  • If you are just getting started, then you can hire the services of a 3rd Party Logistics company.
  • You can partner with people like Amazon or Flipkart and sell through their portal using their logistics capabilities.

In any case, managing delivery operations is a nightmare if you don’t have delivery management software. Here is our blog that helps understand what a delivery management software is and what it’s capabilities are.

In this article we explore the challenges of managing delivery operations and benefits of delivery management software especially with respect to a small and medium enterprise.

Recruitment Delivery

Challenges in managing delivery operations

Delivery operations are complex and require great attention to detail. The following is a list of seven challenges, especially with small and medium businesses.

  • Capability to manage effective and efficient deliveries consistently

    Putting out your products on the Internet helps you reach more customers. In fact, your delivery operations can expand even internationally. However, you must meet customer expectations in terms of delivery cost and time. This is not a one time affair. This means that you must have a dedicated delivery operations team to run your deliveries flawlessly. This maybe a challenge for small and medium enterprises.

  • Minimizing delivery cost by optimizing carrier, route, density and volume

    Running online operations involves a cost. A major portion of this is delivery cost. Most times small and medium businesses underestimate these costs. Also consider the fact that in 2015, almost 60% of online transactions included free shipping. This means that customers expect you to absorb this cost. So, cost minimization is necessary.

  • Capacity to Scale with operational agility matching to the demand cycles

    Product demand may keep varying. Even though we can make estimates, sudden fluctuations in demand are quite common. When demand surges, if we don’t have adequate supply, we miss the opportunity. When demand falls, if we have too much supply, we add to inventory costs. Adjusting capacity is a must for small and medium business enterprises

  • Competence to innovate consistently leveraging technology

    Delivery operations are no longer transactional. Many big brands and D2C brands consider that delivering directly to customers presents a very unique branding opportunity. Since delivery operations are intensive and require attention to detail, most Small and Medium business end up spending time in managing routine operations rather than on building competence required for innovation

  • Control manage end to end connectivity from tracking, visibility to follow-ups

    Delivery operations require continuous informational flows in real time. Whether we want to track our shipments or provide customers the ability to find out where their packages are, we have to label and track packages from end to end. This requires real time tracking and responding abilities.

  • Continuous Improvement through measurement, consolidation, missed deliveries and analytics

    A deep understanding of delivery operations is needed for making sure we never miss deliveries. In our previous blog we have shown that the cost of a failed delivery is three times the cost of the original delivery. Conducting delivery audits and understanding what went right and what went wrong is a must.

  • Customer Experience, Convenience & Delight

    At the end of the day, we undertake deliveries because we want to reach our customers. If the entire delivery experience is a logistics nightmare for the customers, they would never come back to you again. Delivering consistent and delightful customer experience is the only way to gain customer loyalty and trust.

Delivery Optimization

What are the benefits of delivery management software?

Delivery Management softwares are built around the challenges of the first, middle and last mile deliveries. Though each software has its own capabilities and uniqueness, they all have some common benefits. Usually, when you begin using a delivery management software you will be able to:

  • Manage more orders per day, with accurate information..
  • Reach customers faster and at an optimal cost.
  • Increase your capacity throughput per trip.
  • Save cost by optimizing routes, capacity and resources.
  • Save time by automating routine tasks.
  • Use the power of AI to ensure optimal operational efficiency.

AI powered algorithms for optimization

Optimization in logistics and supply chain systems is a well defined and solved mathematical problem. AI powered algorithms use these models to arrive at shortest routes or best capacity throughput needed to optimise fuel and man hours. This helps small and medium businesses to leverage the power of knowledge and offer faster, better and cheaper services to their customers.

Data validation for information accuracy

Software processes can be developed to ensure all required information is available. Through implementing data validation rules, we can ensure that information is accurate enough to process delivery jobs.

Automation for saving time

Routine tasks can be automated to run with minimal human intervention. For example, printing labels for accepted delivery jobs or assigning parcels to vehicles when preparing a trip or even managing fleets, drivers and shifts such that all regulations are met with. These are time saving steps

The time released can be used to focus on your core business. You can generate revenue and innovate your business model to best suit your customer expectations.

Realtime Information through dashboards for fast responses

Most delivery softwares connect to your on-field agents and driver partners through mobile apps. They can be empowered to update evolving on ground information which can be used by your back end operations team to make quick decisions and communicate the same in real time.

Some of these processes, when built around industry best practices, can avoid delivery failures and reduce cost of operations. For example, communicating a vehicle breakdown and responding to it with real time information based on industry best practices such as rerouting existing nearby vehicles, while at the same time communicating the delay (if any) to customers along with reasons for delay.

Conclusion

Managing delivery operations end to end with delivery management software has great benefits for small and medium enterprises. If we carefully evaluate the software and choose the best one according to our requirements, then we can ensure business continuity and also become profitable through bigger scale and wider reach of our products and services.