A new survey reveals the impact of delivery-related issues on retailers and consumers.
According to the Annual State of Shipping Report from UPS Capital, surveyed retailers identified the following top threats to delivery success:
- Porch piracy (items stolen from customer doorsteps) 54%.
- Damaged shipments 51%.
- Lost shipments 49%.
- Inventory delays 37%.
- Reverse logistics 30%.
More than nine in 10 (92%) retailer respondents said they suffered cost impacts to their business as a result of lost, stolen, or damaged shipments. Specifically, retailer respondents cited the following negative impacts on their business:
- Extra time spent resolving customer issues (53%).
- Financial loss due to sending second unit (50%).
- Loss of sale/customer (45%).
- Negative customer reviews (37%).
- Lost time and expense submitting and managing claims (35%).
- Canceled orders (34%).
The survey also examined the top issues specifically affecting retail delivery, and porch piracy again came out on top:
- Porch piracy (63%).
- Credit card fraud (54%).
- Late shipments (51%).
In addition, the research found that 44% of surveyed shoppers experienced porch piracy during the 2021 holiday season, and households with children were twice as likely to experience porch piracy compared to childless households. With this in mind, 38% of shopper respondents reported they are less likely to shop online during the 2022 holiday season due to ongoing delivery issues, such as lost, stolen, damaged, or delayed packages.
Another growing area of delivery concern for retailers is shipping fraud. Almost four in 10 (37%) retailer respondents reported credit card fraud is a growing risk to their business. Three in 10 (31%) reported that return shipment fraud is significantly impacting their profitability – from missing merchandise to altered labels and return addresses. More than one in four (27%) surveyed stated that false reports of stolen packages are a growing issue.
To mitigate the increasing risk of fraud, many surveyed retailers are interested in having greater visibility into shipping-related issues, including number of late shipments (74%), number of lost claims (72%), insight into credit card fraud transactions (71%) and notification of addresses with high claims (70%).
On the consumer side, the survey also found that when experiencing a lost, stolen, or damaged package, the majority of shopper respondents expect to receive a replacement (84%) or a refund (80%) within a week of notifying the retailer.
Oracle: Holiday shoppers want fast, guaranteed delivery
A recent survey from Oracle Retail also highlighted some current findings about consumer holiday delivery preferences, including:
- Home delivery (56%) is the most popular method for respondents to collect items bought online, compared to curbside (21%) or in-store pick up (16%).
- 47% of respondents said fast delivery often determines who they will order from.
- 62% are willing to pay more for expedited/guaranteed delivery.
- 61% would consider booking a third-party delivery/collection service to ensure they get their gifts on time.
UPS Capital surveyed 500 merchants and 1,000 online shoppers across the U.S. to better understand shipping-related issues.