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Black Friday in depth: how parcel carriers have prepared

Conflicting views have materialised on the benefits of Black Friday ever since the annual retail markdown day made its way over from the US and caught a number of UK retailers by surprise in 2014.

Some, such as Dixons Carphone, are actively embracing it, confident that the special offers for customers will once again provide a real sales fillip in the build up to what is traditionally the busiest shopping period of the year. Cycling and sports products e-tailer Wiggle views it as a way of easing pressure on the home delivery networks directly before Christmas by bringing forward a percentage of sales.

Amid the wide range of marketing campaigns centred on Black Friday, some retailers have made their moves to actively distance themselves from the one-day discounting mentality. Asda will be offering deals throughout a longer period – arguably trying to avoid some of the scenes from last year which saw customers fighting over cut-price electricals in their stores – while beer and wine retailer Oddbins has even kick-started an anti-Black Friday campaign, saying it "is having a terrible impact on customers and retailers alike".

Summarising the state of play, the Institute of Customer Service asserted this week that the way organisations manage their profitability and performance over the long term should be more of a priority than heavy discounting for short-term gain.

CEO Jo Causon said: "The risk of building up so much anticipation over such a short time is that some customers will be left disappointed if what they want sells out, or if the ability to purchase is hindered by technology failing when too many visitors to a site cause it to crash. 

"A poor experience leads customers to look elsewhere and it will be the organisations who put long-term reliability over short-term revenue whose trading will do well long after Black Friday is over."

Poor experience in delivery is a real customer turn-off too, and as Black Friday sales in 2014 disrupted retailers' typical selling patterns in the build-up to peak season, some of the distribution networks were not prepared for new levels of demand. In the months since then, a number of carriers have been putting plans in place to deal with this new event on the retail calendar, which Visa Europe says will see £721 million spent online and £1.19 billion spent via other channels.

Essential Retail has rounded up the latest news from the carrier networks, looking at what processes have been put in place to deal with new-look peak shopping season.

DPD

The company says it is planning for a 30% year-on-year increase in parcel volumes for the Black Friday to January sales period.

DPD has a new sorting hub in Hinckley, Leicestershire, which opened in September and increased its overall UK parcel capacity by 65%. In addition, more than 950 new, permanent drivers have been recruited and trained to prepare for this forthcoming period of peak demand, while four brand new, purpose-built 60,000 sq ft 'Super Depots' are now operating in Cardiff, Dagenham, Exeter and Stoke.

From a technology perspective, DPD is expecting its one-hour delivery service, Predict, to play a prominent role. The solution provides customers with advanced notification of their exact one-hour delivery slot and gives them a chance to choose a range of real-time fulfilment options such as deliver to a specific neighbour, leave in a specified safe place or divert delivery to the nearest DPD Pickup shop.

Dwain McDonald, DPD CEO, commented: "For me the key to handling volume is around being more efficient.

"The latest fully automated hubs and depots help us manage higher volumes in the network, while being a seven-day-a-week operation means we are constantly moving everything through the system avoiding build-ups over the weekend. Out on the road, we'll send over 50 million advanced notifications during peak, and the real time responses our drivers receive from recipients mean that before they attempt a delivery, they already know who's in or out and what they want us to do with their parcel, which saves a huge amount of time."

Yodel

Yodel, which was criticised last year when it was forced to halt deliveries from its distribution centres due to blockages caused by heavy Black Friday demand, has opened what it describes as new "super service centres" across the UK, in Livingston, Waltham Cross and Southwark.

Announced this week, the additions to its estate support Yodel's capability to deliver up to 4.9 million parcels per week in the run up to Christmas. The three new sites come after the carrier opened larger service centres in Northampton, Selby, Farnborough and Alfreton, earlier this year, and two temporary hubs – in Brighton and Preston.

July also saw the carrier appoint Mark Horrobin as peak planning director, and it has been his job to recruit and prepare a team for this year's Black Friday and Christmas peak. The new sites and the recruitment activity form part of Yodel's £30 million investment programme, which also involves upgrades to IT, mechanical handling and training.

Other measures introduced will see Yodel provide daily performance updates and advance weather forecasts to retailers, while businesses are also being encouraged to provide accurate customer contact data for drivers to keep communication channels strong. 200 additional HGVs and 500 additional trailers have been added to the fleet operation, while there will also be a central peak control tower operating in Wednesbury, West Midlands, to manage trailer movements and operations.

Hermes

Hermes UK CEO, Carole Woodhead, recently revealed her company's plans for peak season, saying that the carrier has been actively encouraging retailers to share their promotional schedules.

In addition to operating with retailer-specific daily plans, which will see Hermes provide daily service reporting to its clients, Hermes is offering its partners – such as shoe retailer Foot Asylum – the opportunity to use MyHermes as an overflow solution if demand increases at too rapid a rate.

With Hermes estimating that Black Friday demand is set to increase by 20% this year, other infrastructure investments have been made – including the doubling of capacity at its Warrington hub and significant advancements in IT systems and data processing capacity.

CitySprint and iForce Group have also both committed to growing their teams ahead of peak season, with the former adding "hundreds of jobs" and the latter growing its workforce with approximately 1,850 temporary warehouse colleagues to reinforce operations in December.

But will it be enough?

Ecommerce delivery technology provider MetaPack says the industry is much better prepared than last year, ahead of Black Friday and the consequent demand it will have on delivery volumes.

Although the carriers have been investing in infrastructure to keep pace with expected home delivery pressures, retailers' growing preparedness and newly-built strategies have also contributed to the positive vibe.

Kees de Vos, chief product officer at MetaPack, commented: "We can see already that retailers have adopted new strategies and are putting in place mechanisms that will help to spread the delivery load over a much longer period of time.

"This will avoid the unnecessary pressure on logistics and courier services immediately following Black Friday and the Christmas/Boxing Day sales. Retailers know that delivery is a vital part of their offer to customers and that it is absolutely essential to meet their delivery promises, so we doubt that all will be offering next-day delivery, for example, on Black Friday."

De Vos said the beginning of each week during December will see peaks in delivery demand, but he expects fewer "very sharp peaks" than one year before.

"This will allow retailers to ensure the supply chain has more breathing space to manage the process efficiently," he added.

"Both retailers and carriers are all too aware that the peak period promises huge opportunities and huge challenges in equal measure and are already collaborating closely to provide consumers with a wide range of flexible choices without compromising on the quality of delivery services during this critical time."

Representatives from the various sides of the retail industry say they are prepared for Black Friday. The next few days will prove if they were right.

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