How to quickly build a delivery system

The unexpected format of the new crisis, with a long quarantine and the prospects for new waves, opens up a new marketing reality for us. And in it, the presence of its own online platform and a built delivery system is mandatory for almost every trading, manufacturing company, restaurant and similar businesses. Founder of Rational Logistics Valery Pozhidaev shared tips relevant to the establishment of his logistics.

Domestic Courier Service

1) Decide on the type of delivery depending on the geography of coverage of your store. Car, bike, electric bike, motorcycle, monowheel, on foot - think over options.

2) For the selection of personnel, use professional resources (Rabota.ua, etc.), but you can also choose on services such as “Aim the Hog”, focusing on the rating of applicants.

3) Be sure to conclude an employment contract and an agreement on full liability, job descriptions, scripts. In order to minimize tax costs, think about what losses you may suffer in case of damage / loss / theft of goods.

4) Provide couriers with branded clothing or at least caps / aprons and personal protective equipment (masks, gloves, disinfectants). This will be relevant not only in the coming weeks.

5) When setting plans, keep in mind: with a well-laid route, a good experienced courier will deliver a maximum of 30 orders per shift. Maybe less, depending on the spread of points and traffic in the city. Think over a control system, GPS-beacons in vehicles, tracking programs. Only planning will help to avoid chaos and failures in terms of time.

Outsourcing Services

With a small quantity or wide geography of deliveries, the best solution is to outsource the service. Courier services that can be considered for work other than Novaya Poshta and Ukrposhta: Glovo (delivery from restaurants, cafes), Meest Express (specializing in targeted delivery), Kabanchik, Rocket and various regional company. We recommend first dividing the volume of goods for delivery between 2-3 companies and empirically evaluate which option is more convenient. At first, collect applications for customers yourself. Check if the company's inventory can be transferred for safekeeping for quick sorting and selection. These are very convenient outsourcing functions that offload the company.

Service cost formation

According to studies, the delivery price and the availability of options (Nova Posta, Ukrposhta, courier) often become a factor in deciding whether to make a purchase in this online store. Of course, free shipping wins when purchased from ??? UAH or when buying a certain set of goods (and this is already a marketing campaign, which also needs to be worked out). But it’s important for you to correctly calculate the cost of delivery services so that sales and sales growth will lead your business to development, and not to losses. Margin in the delivery service is usually not invested, but consider the following costs:

• fuel, depreciation of your car or courier

• salary of a courier driver

• remuneration of the dispatcher

• remuneration of the work of the order picker and other personnel involved (specifically for the delivery service, but not for standard operations),

• payroll taxes

• overhead in the provision of services

• percentage to cover “single” trips (the client is not at home, he refuses to purchase goods, etc.)

At the same time, delivery obviously cannot cost a lot. It is necessary to focus on taxi tariffs in the village and the cost of delivery from competitors, as well as the usual services of "New Post" and "Ukrposhta." If your delivery is more expensive, it is necessary to reduce the cost of services by optimizing processes and costs.

Principles of order assembly

1) Assembly by request (then the courier at the address simply takes the finished order and gives it to the customer) is used with a large number of SKU (wide range). Goods before delivery to the buyer goes the way: transferring the application for the warehouse, issuing to the courier and directly delivering. All this must be taken into account and the customer should be informed of the delivery time, convincing him to wait, and not order on another resource.

2) Assembly on routes (the courier collects a specific application directly in the car). It is used where there are a small number of SKUs for sale: clothing, cosmetics, grocery sets. Only you can choose the best, taking into account the specifics of the product and needs.

3) The stock of goods in the car (if the goods are of the same type, for example, drinking water). If a new application arrives after sending the car and the dispatcher understands that the courier is closer to the customer than to the warehouse, the availability of stocks will help to avoid unnecessary costs and reduce the waiting time for the client.

Think of software for controlling warehouse processes, the so-called WMS. There are about ten such decisions on the Ukrainian market. The leaders of 1C: WMS Logistics. Warehouse Management ”, YARUS WMS.

Route planning
When planning delivery volumes and standards for courier drivers, you need to really evaluate traffic flows (traffic jams, congestion and quality of roads), average time spent on servicing each client. Evaluation should be done by a specialist or special software to optimize targeted delivery. For example, the courier delivery management system rationallogistics.net is a comprehensive solution that includes:
• mobile application for couriers
• cloud service to create optimal routes
• dispatcher workplace for courier management
• step-by-step instructions for implementing such business processes
• implementation support service (courier service consulting)
The application forms a route taking into account many parameters. Even the type of product is taken into account: small electronics, which will be immediately taken away, or several pairs of shoes, the decision on which will be taken after the fitting. The presence / absence of payment is also taken into account. In fact, the driver ceases to control the route, and the "smart" application takes control. Accordingly, the same tasks are solved by half the number of cars and workers, which makes it possible to reduce the cost of deliveries. Connecting to the system is free and makes economic sense for companies with and more than 3 couriers. A message is also sent to the client about the arrival time of the courier. Such a system can save from 20 to 50% of the cost of courier delivery.
Incident management
Incidents are all that leads to under-deliveries of products to the following points:
• no money to pay
• queue for delivery
• there is no person who can accept the goods (will not be at all or need to call later)
•traffic jam
• breakdown on the road
• unscheduled demand to pick up a refund
• more time spent at the point than planned, etc.
Each such incident leads to irregularities in the route, which must be corrected immediately. After all, any delay leads to failures, the consequences of which are: return of goods to the warehouse, repeated requests, repeated issuing of documents, customer dissatisfaction, etc. In general, the costs. Dispatch systems allow you to manage incidents before they even happen. Using constantly collected statistics, at each moment of movement of each car, such a program makes a forecast for each driver or courier: it will deliver / not deliver, it will be in time / not in time and will signal the dispatcher about the possibility of non-delivery. And he can already reload part of the orders into another car, change the route in favor of category “A” points, hasten the driver or arrange with the client about the car’s arrival at another time. That is, to exhaust the incident at the start.
Optimization of logistics costs
1) Cooperation of several stores, joint deliveries to nearby locations. It allows you to use stores in different areas of the city as warehouses, concentrate couriers on a small location, and accordingly reduce delivery costs and increase its efficiency. Goods for delivery are collected in warehouse stores in different areas.
2) Cross-docking. If the company provides delivery and logistics as a whole quite professionally, it can take another business or several for service. For example, to deliver small quantities of non-conflicting goods. This reduces the cost of delivery, more cars are filled and, accordingly, the delivery efficiency of each product is increased. Then you do not need to keep extra staff and devote more time and attention to sales or production.
3) Formation of standard grocery or other product sets, package offers - any options for buying a group of products from your assortment. This increases the average bill and reduces the cost of logistics processes.
When organizing the delivery of your goods, remember that logistics is a scale, on one side of which - cost, on the other - quality. The parity between the quality of delivery, which suits the consumer, and its cost, which the entrepreneur can afford, is important.