The growing demand for logistics services has become indispensable from a consumer perspective. Logistics companies around the world contribute to the smooth running of global trade transactions and are crucial for satisfied customers. The wishes and requirements that consumers place on logistics service providers have changed significantly in recent years. It is therefore important that companies rethink their strategies and adapt to the new needs.
REVOLUTION IN ONLINE RETAIL: HOW COMPANIES MUST RESPOND TO NEW CUSTOMER DEMANDS
The online retail sector in particular has undergone a revolution: Customers expect excellent service with fast and cost-effective delivery as well as a high degree of flexibility. Returns must also be processed smoothly – especially in terms of speed and cost savings.
Large retail platforms such as Amazon have further intensified these demands. In addition, more and more consumers are advocating sustainability in logistics; things like recycling or energy-efficient working have long played a role here.
MEETING COMPLEX EXPECTATIONS IN THE B2B LOGISTICS SECTOR
The buzzword “customer satisfaction” is often used in companies. However, only a few look into the question of which factors influence customer satisfaction and what consequences poor advice or inadequate services can have.
In the media company sector, the demands on customer relationships are particularly high. This is because advertising-financed media are not aimed at end consumers, but at business customers. This type of business-to-business (B2B) relationship poses different challenges for customer service than is usual in the business-to-consumer (B2C) sector.
In the B2B sector in particular, completely different expectations collide. The focus here is on speed, efficiency, safety and precision of delivery. As large companies often transport sensitive goods, particularly strict quality controls are paramount and mistakes can be costly. This makes it all the more important that the logistics chain functions perfectly.
The B2B market differs from the B2C market in many respects. In B2B communication, the focus is on decision-makers or co-decision-makers in companies who pursue commercial purposes and have a greater interest in complex and individual offers.
In order to survive in the B2B market, it is important that companies train their employees and ensure personal communication with the customer. In addition, the relationship with the customer must be maintained in order to ensure their satisfaction. This also influences the purchasing decision process.
SURVEY RESULTS: CHALLENGES IN FOOD LOGISTICS ARE INCREASING AND COMPANIES ARE RESPONDING
The challenges in the food logistics sector have increased in recent months. In particular, increased costs, a shortage of transport capacity and international competition for freight space are causing adversity.
The flash survey of companies in the food industry shows the current logistical problems and their causes. It was conducted by the Federal Association of
German Food Industry (BVE) in 2021 under the title “Current challenges in food logistics”.
RESULTS OF THE BVE FLASH SURVEY
When asked which topics will (continue to) gain in relevance in food logistics in the future, 25 out of 37 companies responded that they want to expand their partnerships with transport service providers to secure freight capacities.
21 companies report that the importance of sustainability in relation to logistics processes and routes will increase. For a further 21 companies, improving the security of the supply chain through better cooperation with suppliers and customers is the top priority for the future.
More than three quarters expect increasing difficulties. The situation is described as particularly challenging for road and sea transport. Logistics costsare continuing to rise sharply or moderately. This is mainly due to the reduced transport capacities caused by COVID-19, a lack of truck personnel and storage capacities as well as rising energy and fuel prices.
In order to make logistics processes more effective, the companies want to expand their partnerships with service providers, integrate sustainability more strongly into logistics processes and reach better agreements with suppliers and customers.
SUSTAINABILITY AND CUSTOMER SATISFACTION IN THE PARCEL SERVICES LOGISTICS SECTOR
Customer satisfaction is one of the most important goals in the parcel services logistics sector. Whether it’s delivery within a certain timeframe, the returns process or sustainable logistics practices, customers have high expectations of their online shopping experience.
In order to meet these expectations, the company must have all the relevant information and take the necessary steps. This also includes the use of environmentally sustainable materials such as recycled cardboard or fiber padding as well as the use of alternative means of transport and the support of local workers.
Such measures can ensure that customers are more satisfied with the entire process and strive to be more sustainable in the industry.
Customer requirements in terms of speed:
- Delivery within a certain period of time
- Real-time tracking
- Notifications to track the order status
- Option for express delivery or faster alternatives
Customer claims regarding returns:
- Return process should be as simple and free of charge as possible
- Customers should be able to choose the type of return (letter post, local collection point, etc.)
- Refund of the purchase price within a certain period of time after sending the product to the retailer
aspect of sustainability:
- Use of ecologically sustainable parcel materials such as recycled cardboard, fiber padding, etc. to minimize environmental impact
- Use of alternative means of transportation such as sea freight, rail transport or bicycle messengers to reduceCO2 emissions
- Supporting local workers by developing better working conditions in warehouses and logistics centers as well as more opportunities for training programs
- Reduction of paper consumption through digital documents such as invoices and packing lists
- Educational work regarding sustainable logistics practices for end customers and suppliers
BENCHMARKING REPORT REVEALS WEAKNESSES IN LOGISTICS, SHIPPING AND SERVICE
The Körber Supply Chain Benchmarking Report 2022 from the solution provider Körber Supply Chain Solutions shows that only 28 percent of the companies surveyed can meet the expectations for shipping and service.
As part of the survey, the participating companies were divided into four maturity levels and analyzed. The report revealed that digitalization and process automation as well as plant optimization have a lot of room for improvement. According to the report, sustainability is a strategic or high priority for 89% of companies, although many are lagging behind in terms of implementation.
The COVID-19 pandemic has clearly shown that transparency and cooperation with external stakeholders are essential. There are also weaknesses in IT security that could have an impact on the entire supply chain.
THE IMPACT OF GREEN LOGISTICS ON THE CUSTOMER EXPERIENCE
Consumers prefer more environmentally friendly deliveries, even if this means longer waiting times and higher costs.
Environmentally friendly logistics is an urgent issue for companies in all sectors. Through
- the optimization of route planning,
- the use of electric and two-wheeled vehicles,
- the choice of green partners in the 3PL,
- the combination of pick-up and delivery options and
- the provision of environmentally friendly time slots
companies can help to reduce emissions and increase fuel efficiency.
Consumers also prefer sustainable logistics solutions. Companies should therefore consider what opportunities there are to offer environmentally friendly delivery options. At the same time, they must take care to maximize delivery density and improve first-time delivery rates. In this way, everyone can contribute to reducing traffic in urban areas and thus also emissions.
In times of digital change, companies in the logistics sector can do a lot to improve sustainability andreduce CO2 emissions. The use of new technologies such as delivery management platforms can significantly increase efficiency throughout the entire logistics process.
Algorithms can be set to give preference to more environmentally friendly vehicles and carriers. In addition, specific navigation data can be used to avoid wasting fuel due to unsuitable routes.
With the help of these technologies, it is therefore possible to automatically optimize hundreds or thousands of planned deliveries within minutes – an enormous resource-saving advance over manual planning.
WHAT DOES CONSUMER BEHAVIOR MEAN FOR LOGISTICS?
From December 10, 2015 to February 15, 2016, the German Logistics Association (BVL) conducted an online survey of 1,381 people to find out more about consumer preferences and how these affect the logistics market. Among other things, the survey revealed the following results:
- 67.49 percent of all participants prefer delivery to their home address,
- 16.94 percent use packing stations or central collection points and
- 11.66 percent have their order delivered to their workplace.
Furthermore, almost two thirds (63.87%) stated that they are satisfied with a delivery time of 2 to 3 days, while 17.3% prefer same-day deliveries where possible. New delivery methods are still viewed rather skeptically – almost half of respondents have not yet tried them and more than a third assume that these delivery methods are not suitable for them.
These results clearly show the influence that consumer decisions can have on logistics and that it is becoming increasingly important for companies to understand the needs and wishes of consumers and act accordingly.
CONCLUSION
The logistics sector will continue to grow in importance in the future thanks to globalization and online retail. Nevertheless, they must react to changes and continue to develop in order to optimize their processes and offer customers an even better service.
Logistics companies must adapt to the fact that consumers expect more and more flexibility and reliability. This means that logistics service providers need to rethink their strategies and meet the high demands of customers.
Not only speed and cost efficiency play a role here, but also sustainability aspects such as recycling or energy-efficient work. Logistics companies should also focus on innovative technologies.
Overall, it is important that logistics service providers face up to the challenges. This is the only way they can continue to be successful and satisfy customers in the future.
Image credits
Image 1: stock.adobe.com © Vladyslav
Image 2: stock.adobe.com © Leika production
Image 3: stock.adobe.com © photoschmidt
