When an online business delivers on time, it's not just a common courtesy—it's also a mission-critical competitive advantage. On-time delivery improves customer satisfaction, increases sales, boosts brand reputation and prevents added costs. From ERP software and integrated shipping to tighter planning for parcel shipping operations, there are many ways to keep deliveries on track. But you need to consistently plan, execute and control shipments so they reach buyers on time if you want to make the most of your online business. Let's look at the impact.
Happy customers champion your business and brand; getting them what they need on time builds trust. They can plan around that delivery and get things done. They tell others, both online and in their lives. Though these metrics are tricky to estimate, experts say that, on average, word-of-mouth influence drives around $6 trillion in annual global spending, and around 13% of all sales in general.
This dynamic cuts both ways. Unhappy customers also create headwinds to growth. According to Search Engine Journal, ninety-six percent of online buyers look specifically for negative reviews. And everyone's heard the old adage that unhappy customers tell more people about their experience than happy ones.
The satisfied buyers created by on-time delivery also promote more business growth by becoming repeat customers themselves—and by giving you a chance to earn a greater percentage of their business. In fact, on-time delivery impacts a variety of sales-related Key Performance Indicators (KPIs) that include customer lifetime value, annual contract value, conversion rate, average purchase value and the number of sales generated through referrals. What's better, the cost of acquisition for these sales has the potential to go down as already warm prospects convert more quickly through past experience and positive social proof.
Your brand is merely the sum of what buyers, potential buyers, the general public and others think of your company and its products or services. Every time you nail an order delivery, you're improving and protecting your brand. Every time your products arrive late, for whatever reason—even reasons completely out of your control—you're chipping away the goodwill and brand equity your business has earned over time.
And your competitors? Well, they'll be right there to pick up the slack. Online commerce will reach over $1.1 trillion in sales for 2023 within the United States alone. In addition, today's buyers have higher expectations than ever when it comes to delivery predictability. One recent study shows that many buyers even prefer a guaranteed delivery date to a faster delivery date. People need to know when to expect things so they can plan accordingly, and they're entrusting that ability to your brand.
On-time delivery can also help everyone in the supply chain avoid all kinds of extra overhead. Delay-related costs could include everything from additional third-party facility charges to demurrage at an overseas port to extra carrier or courier fees. The list is both endless and, oftentimes, preventable. And that's in addition to opportunity costs.
Consider a small factory that orders a custom valve for its upcoming maintenance turnaround. Hundreds of thousands of dollars' worth of people and equipment are assembled to perform the work while the plant is shut down. If the valve is late, the plant stays offline and unprofitable while crews wait for the valve. The true cost of late delivery is often not in the contract itself but in the consequences.
Sometimes you can do everything right, and still not deliver on time. But persistent delivery delays are avoidable through tight ERP integration, digital supply chain tools, process improvements and employee training. However you do it, ensuring on-time delivery is worth the effort to keep customers happy, promote sales growth, protect your reputation and build your bottom line.