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Same Day Delivery - Competing for Consumers

By Herb Shields | 08/13/2013 | 8:00 AM

Last December, there was an article in DC Velocity about the USPS effort to develop a service to compete with some of the major on-line and store-based retailers.  While the Post Office is still a minor factor in the market, the battle between some giants – notably Wal Mart, Amazon, and E-Bay is really heating up.

Wal Mart has been trying to increase its on-line presence ever since it introduced it’s web site back in 2004.  It appears that Amazon will be its primary competitor for the consumers who shop on-line and desire same day delivery of their orders.  Obviously, same day delivery is not an inexpensive service for any retailer to offer and there are a variety of charges and approaches to how Wal Mart, Amazon, and others offer the service. Interestingly, all three companies are experimenting with offering lockers set at specific locations as one way to “deliver” the product and let the customer make the final pick-up themselves.

Recently some other companies have entered the market here in the U.S.  Shutl, a U.K. based software company has already captured a significant share of the U.K. market for same day service.  Note the Shutl is a software company – no warehouses, no trucks, etc.  Its approach is to partner with stores and couriers in major markets.

A much more familiar company – Google- has also entered the competition in the San Francisco Bay Area which not surprisingly is the test market used by many of the companies that I have mentioned. It is densely populated with consumers who are oriented towards all of the features of on-line shopping and same day service.

About fifteen years ago, I participated in many discussions at Helene Curtis and then Unilever where the subject of customizable mass-market products was discussed.  It will be very interesting to see if customizable products will eventually be offered with customizable delivery as well.

Many of my readers know that I teach at the Illinois Institute of Technology here in Chicago.  I have to credit one of our current students from Spain – Sergio Lopez Lopez – for writing an excellent paper on the topic of same day delivery which served as the basis for much of the content in this article.  I have found teaching to be a great learning opportunity. 

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About Herb Shields

Herb Shields

Herb Shields has run Chicago-based HCS Consulting since 2000, helping clients across multiple industries and in higher education improve their supply chain strategy and execution. Shields has more than 30 years as an operations executive for capital equipment, automotive, electrical machinery and consumer products companies. As vice president of materials management at consumer goods company Helene Curtis, Shields led the supply chain organization that helped Helene Curtis win "Vendor of the Year" awards from Wal-Mart Stores and Target Corp. Shields has a B.S. degree in Electrical Engineering from Clarkson University and did graduate work in business at Bowling Green State University.



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