In House Delivery: Mastering Last-Mile Control for Your Business
Tired of unreliable delivery services impacting your businesses reputation and profits? Get the lowdown on bringing your deliveries in house.
Picture this: You've finally gone and bought that item you had your eye on online for months. After making your purchase, you eagerly anticipated its arrival all week. Despite keeping a watchful eye on it using the tracking number, the delivery driver arrived while you were out and tossed it over the front wall of your garden, damaging it. All that excitement quickly turns to utter disappointment and a little anger.
As a consumer, this can be infuriating, but for businesses that take pride in their products and services, it can be even worse —all their hard work destroyed in a moment by a careless delivery driver.
In fact, this can often be the deciding factor in a business deciding to bring their delivery operation in-house—doing the delivery themselves rather than relying on a third-party delivery provider.
Of course, this is just one reason you might want to manage your own deliveries. There are certainly many more arguments for it, and that is kind of the purpose of this blog: to highlight the pros and cons of in-house delivery. If you have been deliberating the decision yourself, hopefully, this will at least cover the basics.
Finally, we’ll look at how delivery management software can be the central enabler to your in-house delivery operation.
So, without further ado, let’s get into it!
What is the meaning of In House Delivery?
Benefits of doing your own deliveries?
What is the meaning of In House Delivery?
In-house delivery involves a company managing its own last-mile delivery process, using its own staff and vehicles to transport goods directly from a store or warehouse to customers. The in-house delivery method helps maintain control over the delivery experience, costs, and reputation.
It’s crucial not to confuse this with "in-home delivery," which refers to delivering goods directly inside a customer's home, often in their absence. In-house delivery focuses on using the company’s resources to handle all aspects of delivery, contrasting with third-party logistics (3PL), which outsources delivery to external companies like FedEx or UPS.
The primary difference lies in how the delivery operations are managed. In-house delivery involves a company using its own resources, including vehicles and personnel, to transport goods to customers. Third-party delivery, often referred to as third-party logistics (3PL), entails utilizing external services like FedEx, UPS, or DPD to handle deliveries on the company's behalf. This allows businesses to leverage specialized logistic services without maintaining a delivery fleet.
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Key Considerations for In-House Delivery
When it comes to considerations around what you should use for your business, there are usually some key considerations, including:
- Cost: Managing costs directly can lead to better financial planning.
- Control: Full oversight of the delivery experience protects your brand.
- Brand & Delivery Experience: Direct interaction with customers can enhance brand perception.
- Scalability: Adapting delivery capacity to business growth is easier.
- Vehicle & Maintenance: Requires investment in a delivery fleet.
- Hiring Drivers: Managing recruitment and training of delivery personnel.
- Fulfillment, Dispatch, & Delivery Processes: Ensuring efficient operations from warehouse to customer doorstep.
I don’t intend to do a comparison of the two on this blog, as I want to keep the focus on the ins and outs of in-house delivery specifically. For a detailed comparison of in-house versus outsourced delivery, refer to my colleague Caroline’s insightful analysis below:
Outsourced vs In-House Delivery? Choosing the Right Option for your Business
Benefits of doing your own deliveries?
It can often be a reaction to poor customer feedback or complaints that lead people to reach out to us here at SmartRoutes. Sure, you want to eliminate this headache for your business, but being proactive can also help to grow and scale your business.
These are just some of the benefits associated with a delivery experience that wows your customers:
1. A personalized delivery experience for customers
Okay, it’s true, I harp on about great delivery experiences all the time. But if you’re going to do deliveries yourself, you’re going to have a golden opportunity to blow your customers away when it comes to the impression of your brand and business.
Now, here’s the thing; not every company that does in-house delivery knocks it out of the ballpark. And frankly, that’s a massive missed opportunity.
By doing in-house delivery, you can nail a number of things. For example:
- How products are packaged
- How packages are delivered in the event of the customer not being home
- Drivers can greet customers by name, enhancing personal connection, and more importantly, represents your brand appropriately
- Dealing with post-delivery queries and after-sales service for customers
We don’t need to sell you on the opportunities that eCommerce and online sales channels have presented, but you might not have considered what has been lost in the transition from traditional brick-and-mortar sales: the human touchpoint in the sales process and the ability to leave a lasting impression on your customers.
Trust us, a smiling driver that greets the customer by name on the doorstep, and thanks them for their business will be the one who becomes a repeat customer over and over.
2. Accurate financial forecasting and return-on-investment
Although the competition for the 'small shipper segment' between the major carriers FedEx and UPS has heated up over the past year, it hasn't been reflected in their pricing. In December and January, they both increased their rates by an average of 5.9%.
And if you roll it back 12 months earlier, they had already increased rates by 6.9%.
Now, I’m not having a pop at FedEx and UPS—there are definitely macroeconomic factors that have pushed inflation in the delivery sector. But it doesn’t help small and medium business owners to plan their own finances when they’re subjected to rate hikes every year.
By doing your own deliveries, you have much more control over the cost of delivery and a much greater ability to forecast it in your financial planning.
Being at the mercy of the big last-mile duopoly has been reason enough for many of our own customers to take the plunge on their own delivery fleet.
3. Easier to offer free or low cost returns
Those of us who move in the eCommerce and last-mile logistics space will be acutely aware of the big shift we saw in 2023—as The Atlantic has reported, the “Free Returns Party” is over. That is, you won’t be ordering two sizes of everything and returning the ones that didn’t fit at the seller's expense anymore.
We don’t necessarily think that’s a bad thing when parcels are covering hundreds, even thousands of air miles.
However, it represents a big opportunity for smaller retailers and eCommerce vendors to get one up on the retail giants that have been threatening monopoly in the online retail game. For smaller businesses that offer local delivery, adding free returns to your offer can actually be highly efficient.
By giving customers a way to book a return, and by having the right delivery management solution (more on that below), it’s possible that your driver can pick it up on a delivery route with minimal fuss. The result is you can now offer a valued service to customers that big eCommerce giants can’t.
Let’s face it; we’re in an era of mega-corporation dominance, and any advantage you can get over them needs to be seized upon.
4. Real, accurate, and transparent tracking
This one is often overlooked but it can be transformational when it comes to the experience your customers have and the efficiency of your DIY delivery process. By doing self-delivery, you have the ability to provide your customers with:
- SMS and emails with near-exact estimated delivery times.
- Real-time tracking of their delivery based on the drivers' location and route details
- Automated photo proof-of-delivery emails showing where parcels have been dropped
- The ability to select time windows for delivery when ordering
Now, contrast that with careless third-party drivers that show up randomly, sign-off on the delivery themselves, and take little or no care with how they handle the goods.
Being able to give your customer full transparency throughout the delivery process is going to transform your brand reputation.
It also doesn’t hurt that all of those useful updates are branded with your business's logo!
Le Patissier: A Case Study Making Home Delivery Work
Le Patissier is a growing patisserie that creates some of the most delicate and luxurious pastries and sweets we have ever seen.
A lot of their business is from customers buying their goods as a surprise gift that gets delivered directly to people's doors. They had tried the third-party courier approach, but it simply didn’t work.
Transitioning from a third-party delivery service to an in-house model allowed them to:
- Deliver products in perfect condition, essential for delicate items like bespoke pastries.
- Provide a personalized greeting upon delivery, enhancing customer experience.
- Handle customer service directly, improving response times and satisfaction.
In-house delivery offers a unique opportunity for businesses to take control of their last-mile operations, ensuring a superior customer experience, accurate financial forecasting, and greater flexibility in returns and tracking. As illustrated by the case of Le Patissier, businesses can significantly enhance their brand reputation and operational efficiency by managing their own deliveries.
Ready to elevate your delivery experience and streamline your operations?
Bringing delivery in house offers a unique opportunity for businesses to take control of their last-mile operations, ensuring a superior customer experience, accurate financial forecasting, and greater flexibility in returns and tracking.
Discover how SmartRoutes Delivery Management Software can be the central enabler of your in-house delivery success.
With SmartRoutes, you can optimize routes, provide real-time tracking, and ensure a seamless delivery process from start to finish. Start your free trial today and take the first step towards transforming your delivery operations!
Frequently asked questions
1. How does in-house delivery compare to third-party logistics in terms of cost and control?
In-house delivery often provides greater control over the delivery process and brand experience, which can lead to better customer satisfaction. While there are upfront costs for vehicles and staffing, it can be more cost-effective in the long run by avoiding recurring fees and rate increases from third-party providers.
2. Can small businesses benefit from in-house delivery, and how?
Yes, small businesses can benefit from in-house delivery by:
- Offering personalized service that enhances customer loyalty.
- Reducing dependency on third-party providers and their pricing structures.
- Gaining flexibility to scale and adapt quickly to changing delivery needs.
- Better managing local deliveries and returns, potentially reducing costs.
3. What are the advantages of using delivery management software for in-house deliveries?
Delivery management software offers several advantages, including:
- Route optimization to save time and fuel.
- Real-time tracking for improved customer communication and satisfaction.
- Simplified management of delivery schedules and driver assignments.
- Automation of delivery notifications and proof of delivery documentation.
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Caroline Hassett
Caroline Hassett
