Businesses which have moved online due to the COVID-19 pandemic face many questions: where the goods will be stored, who will deliver them to customers and how to ensure a fast delivery of goods.
Professionals insist that this year the scope of e-commerce is expected to grow by about 30–40% and around 27% of all businesses that could trade online, but have not yet done so, will open online shops.
The rapid growth of e-commerce makes logistics and parcel delivery services adapt and, in addition to traditional parcel delivery services, offer many additional opportunities that could facilitate the work of online shops.
Justas Šablinskas, head of Venipak, one of the largest express parcel delivery companies in the Baltic region, says that COVID-19 has accelerated the development of 3PL and similar services both in Lithuania and across Europe. Although the quantities of consignments have increased, this does not cause any major inconvenience to the company and it continues to offer next-day deliveries of consignments to recipients.
“The parcel service is no longer a business of carrying consignments from point A to point B. For a number of years now we’ve been offering various additional services to the market. One of these is 3PL, also known as the ‘fulfilment’ service, which allows the owner of the e-shop to store their goods in our warehouses. In this way, the goods can be delivered to the buyer much faster – as soon as the purchase has been made. The whole current situation has generated demand for such services, as trades are moving fast online, although traders do not always have a flexible infrastructure in place to cope with increased volumes, storage of goods, selection, packaging and dispatch via couriers,” Šablinskas said.
Same-day delivery service is more relevant than ever
Surveys carried out in mid-2019 showed that as many as 54% of consumers are prepared to pay more for delivery to have the product quickly, ideally on the same day. Under the quarantine conditions, this has become even more urgent, as the need for buyers to purchase perishable goods safely from their homes has become essential.
“Today we receive more queries than ever regarding faster delivery of products. It would seem that with the strong increase in the flow of goods, delivery times should increase. That’s not the case. Our wide network of carriers and partners helps us maintain fast and high-quality parcel delivery service with the significant increase in traffic flows,” Šablinskas said.
According to the representative of Venipak, the Venipak Drive project introduced in 2014 has proved to be successful. The key to this service is that every person can become a courier and deliver parcels simply travelling from/to work or home, “We mostly use extra-courier network before major seasonal holidays, but at the moment the network has been used more than ever. We have a very large number of those who want to deliver parcels and become couriers temporarily, while the quantities of consignments have also significantly increased. So all these measures allow us to deliver the consignments without major delays.”
According to Šablinskas, the fact that people are permanently at home facilitates the situation and, unlike in the past, they can accept the consignments at any time not delaying the delivery.
In the face of COVID-19, the importance of the place of storage of goods has come to the fore. As a result of quarantine, many shops stopped working and it became more difficult to dispatch the products ordered by customers online. This had a direct impact on both the speed of delivery and the image of online shops. In this case, traders using Venipak fulfilment service gained advantage, because their products stored at the Venipak warehouse can be shipped to recipients on the same day of the order.
“When we talk about fast delivery of a consignment, the fulfilment service is essential in this process, because it makes things much faster – all goods are stored at our warehouse and can be shipped immediately to the buyer,” Šablinskas added.
Of course, users of this service have gained an advantage not only because of the speed of delivery of the goods. By holding goods at the Venipak warehouses these customers only pay for the actual place of storage and the logistics and delivery services, so those whose operations have temporarily decreased or stopped do not incur additional costs. Moreover, instead of looking for who could prepare a product for shipping and deliver it, they can now spend more time on developing and promoting e-commerce.
According to the company’s manager, another important innovation introduced by Venipak is the transportation of goods from factories abroad to Lithuania, “Looking at the whole supply chain, businesses face difficulties in transporting goods from abroad to Lithuania, because of huge paper work. If a business is not large and the quantities of ordered goods are small, they travel a long time. We operate in Europe, Asia and America, customers can deliver goods from factories directly to our warehouses. In this way, businesses do not need to think hard of fast delivery of small quantities – we can deliver them together with the goods of other companies. Furthermore, the seller will not need to store the goods – we will take responsibility for all processes, so the seller can only take care of the sale of goods,” Šablinskas maintained.
A network of drop off points
“Back in 2011, we introduced the first drop off points in Lithuania and expanded the network to 40 drop off points throughout Lithuania, but at that time the market was not ready for this service. Now we will probably be the last to implement it,” Šablinskas said smiling.
Šablinskas says that his company planned to return to the drop off points service this year through its partners who already run the networks. However, since the company cannot guarantee the quality of services and taking into account the shortage of drop off points, Venipak has adjusted its plans. “In the second half of this year we plan to establish the first, more innovative Venipak drop off points in the major cities of Lithuania,” Šablinskas shared their plans.
According to Šablinskas, after the end of the quarantine, people’s habits of shopping online will remain, “E-commerce will continue to be popular, we think that e-commerce will be more popular after the quarantine than before it. Today’s situation shows that the drop off points could be more widely used – for food products and for parcels, so surely we will have our own network,” the manager of Venipak said.