Executive Education

Life after UberRush: How On-Demand Delivery is Evolving to Help Businesses Remain Profitable

For businesses, keeping a full-time delivery driver or courier staff on the payroll is an expensive luxury. Sales ebb and flow, inventories fluctuate, and the costs of overhead, such as rent, supplies and labor, are consistently on the rise.

Yet, the persistent pressure of meeting customer demands — and in return, earning their continued loyalty — can squeeze already tight profit margins. Selling products online is one way to boost the bottom line, of course, but that also means more resources are needed for marketing, managing e-commerce and fulfillment.

It’s no secret the online retail environment has created new customer expectations. Today, tech-savvy customers demand near-instant gratification, and that expectation has trickled down to brick-and-mortar stores. In fact, in metropolitan areas, consumers expect packages to arrive on their doorstep in 40 minutes or less.

Taking deliveries in-house, however, presents its own set of problems. While small business owners are known to wear multiple hats, leaving the shop to make deliveries means someone else has to pick up the slack. Delivery workers may be unreliable,  turnover is high, and managing multiple deliveries with just one or two couriers can result in a spate of late orders, upsetting customers in the process.

Still, on-demand delivery is no longer a value-added service — it’s a prerequisite for retailers competing in a crowded marketplace.  So, how are small retailers to survive in a land full of online giants?

Outsourcing to a third-party delivery service still presents the best solution.

For a while, it seemed that UberRush would fill the gap. Uber’s experimental foray into courier services was, after all, a promising concept. Customers simply ordered their items online, and could expect to receive their deliveries from a bike courier or driver within minutes. But the service made products more expensive for customers and took too much from the couriers — and, as it turned out — retailers weren’t really gaining anything by signing on as a partner. It was just more margin out the door. It was a bust for Uber, too. In spring 2018, the ridesharing and transportation network announced it was shuttering the division.

Since then, on-demand delivery service, EpiFruit, has taken root, and helming the lessons of UberRush, is rising to meet retailers’ needs. This platform arranges contract workers to pick up products at a  rate which can be up to half the cost of an in-house employee on an hourly basis and Epifruit couriers are well equipped to get those deliveries done.

Here are three ways on-demand delivery services are evolving to help retailers.

They’re convenient. With the click of a button, third-party on-demand solution platforms allow retailers to find a local courier who operates as an independent contractor to do deliveries for their business. On an open-market platform, businesses can create minimum bids on their deliveries, and — similar to Uber driver partners — those contractors can then decide whether to take on the task. With a pool of contractors to choose from, retailers can select from an array of delivery partners and choose their driver based off of ratings, distance of pick-up, and pricing. The app allows the retailer to track the delivery worker, or contact them via messaging, if needed. And since the couriers are local, customers can continue to expect their items same-day.

They’re cost-effective. Since, retailers are only paying for deliveries, and not returns, they are also able to drive down costs. Additionally, having an on-demand delivery service eliminates the need to hire a courier or driver full-time, or an extra sales associate to boost in-store sales. A major consideration for businesses as rent and expenses continue to rise and the minimum wage climbs as high as $15 per hour in places like New York City.. As online orders increasingly become a part of the business model, retail owners won’t have to worry about finding the time, or the funds, to fulfill local online orders.

The lower costs of these one-time deliveries also eliminate the worry of the profit-plucking conundrums found in the ‘last mile,’ — including ’not at home’ recipients, empty loads, and inefficient, gas-sucking driving routes. On-demand delivery services are simply one-and-done.

They allow retailers to go the extra mile. Using a third-party on-demand delivery service frees up retail owners and their employees to focus on selling their products and services. And since deliveries are cheaper than say, using one of the big parcel carriers, retailers are able to lower their delivery minimums, deliver farther and increase the radius of deliveries to capture more customers. Ultimately, customers will appreciate the added connectivity and convenience, and keep returning for more. 

Over the next few years, same-day delivery will become the big puzzle retailers will look to technology to solve. Third-party on-demand delivery services lean on individuals who are already in motion to fulfill customer demand, making outsourcing delivery a viable, and affordable solution.

By offering delivery and going farther than retailers have in the past will lead to limitless possibilities. Small businesses can rest easy knowing that an on-demand delivery platform like Epifruit is there to help them get back to what they do best: Selling the products and services they are passionate about.

Written by:

Rohan Duggal is the owner of Columbia Wine Company in NYC and the founder of the on-demand delivery platform EpiFruit, designed to help meet the growing needs of retailers struggling to keep their costs down and satisfy the ever-growing demands of customers.

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