The current landscape shows that organisations that are still operating with ‘conventional’ management of courier services do not have complete control of costs. That shortcoming in management of courier services in organisations is due to their lack of tools to ensure visibility of the processes of document logistics. This article explains how that situation can be changed and how businesses can be empowered to optimise the resources they devote to courier services.
The cost control problem in conventional courier services
Businesses with conventional courier services are at a disadvantage when it comes to managing costs.
There are a number of reasons:
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Lack of real-time visibility
Organisations do not have access to detailed information about who is requesting courier deliveries, why they are making those requests and how much is being paid. That lack of visibility makes it difficult to make well-informed decisions.
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No service menu
In the majority of cases, staff can only request a courier delivery without the option to specify the degree of urgency, the cost or the form of delivery. That leads, for example, to unnecessary spending on urgent deliveries.
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Lack of planning
The lack of information and monitoring means there is also a lack of planning of courier services. Staff often overspend because of ‘urgency’ or a lack of internal communication.
Challenges facing businesses with courier services
Challenge 1: Lack of cost transparency
A key challenge is the lack of transparency around the costs of courier services. Businesses generally have a base tariff with their providers, but often incur add-on costs that they are unable to control. That is down to a lack of detailed information about costs and those very complicated invoices with many, many lines that can be so difficult to understand. Customers have to trust their courier service providers without a clear understanding of how costs and charges are generated.
Challenge 2: Impossibility of monitoring in businesses with large volumes
The problem is even worse in businesses that have large volumes of courier deliveries. In such organisations, it is hard to determine which teams or departments are generating the majority of the cost. The failure of monitoring prevents businesses from taking effective measures to optimise resources and reduce their costs.
Challenge 3: Difficulty of allocating headline budgets to departments
Another important challenge is the allocation of budgets to teams or departments. Without detailed cost information, businesses have no choice but to allocate their courier service budgets ‘arbitrarily’, which hinders the efficient management of resources and decision-making.
Challenge 4: Lack of control over service quality
We should also call out that a lack of monitoring of courier service providers can lead to problems with service quality. Businesses trust their providers but often they do not have the capacity to assess or correct the problems that can arise with the delivery of documents and packages. That can negatively affect customer satisfaction and the reputation of a business.
Challenge 5: Problems with franchised providers and local services
In the world of courier services, many businesses operate through local franchises. That can generate additional problems because each franchisee will have its own management systems, which in turn can impact service quality. Customers encounter situations in which franchised providers do not meet expected service standards, which translates into complaints and customer satisfaction problems.
Challenge 5: Lack of geolocated information
We must also remember the importance of geolocated information to measurement of the efficiency of courier services. In many business, Heads of General Services or Facilities do not have the capacity to keep on top of incidents in different geographic areas. The lack of geolocated information makes it difficult to identify problematic areas and make data-based decisions.
The solution: technology and management
In order to address the problem and allow business to control the cost of their courier services, there is a need for a technology-based, efficiency-focused solution, such as the solution developed by The Mail Company. Here are some key points for the optimisation of courier services:
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Document logistics platform offering a range of choices
Implement a platform like GIO, which has a courier module that offers users clear, specific options for their deliveries. That includes the possibility of selecting levels of urgency, insurance and other customisable features.
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Log of requests and users
Log each courier service request and allocate it to a specific person. That allows detailed monitoring of who is making service requests and how often, providing information that is essential for cost control.
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Setting limits and alerts
Allow customers to set spending limits by department or business unit and configure automatic alerts when spending is close to those limits. That helps to maintain control over budgets and prevent overspending.
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Special services and user education
Provide special customer care for services for items that need extra care, such as deliveries with receipt formalities or extra handling or that are of high value. And educate users so that they can use the courier service efficiently and economically.
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Analysis and proactive feedback
Use the data collected to analyse patterns of spending and provide proactive feedback to customers. That can include suggestions to optimise spending and eliminate unnecessary cost.
Benefits of complete control of the cost of courier services
When a business and its staff have complete control of costs, there is a whole series of benefits, such as:
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Cost reduction
Better informed decision-making and early planning can help businesses to significantly reduce the cost of courier services.
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Greater efficiency
The ability to adjust urgency and other features of a delivery allows more efficient management of deliveries and more effective resource allocation.
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Transparency and visibility
Clients gain a clear, real-time vision of their spending, which improves decision-making and internal transparency.
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Quality control
By establishing who is making requests and why, businesses improve the quality of their courier services and user satisfaction.
The importance of technology and analysis
In order to face those challenges, The Mail Company recommends that businesses invest in technology that provides visibility of their courier service costs. Platforms like GIO have the capability to provide detailed information about costs, delivery tracking and service quality. That allows businesses to take informed decisions and so allocate budgets in a more efficient way.
Based on the know-how it has acquired over the last twenty years, The Mail Company has developed effective strategies and innovative approaches to effectively manage the costs of document logistics that can be used in a range of industries, such as:
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Organic Control Through Software
The installation of software such as the GIO Platform is the foundation of cost control. The program logs every service request, when it was made and when it was completed. That provides valuable information that can be used to review and optimise spending.
A specific example is monitoring how many urgent delivery requests are made. If someone mainly requests urgent deliveries, the business can actively manage that specific pattern of spending.
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Efficiency – a Priority
The importance of efficiency in the management of courier services cannot be overstated. The Mail Company is committed to continuous improvement in service quality even when that translates into a significant decrease in client spend. Our business approach is that even though invoicing may go down, more efficient management pays us back with greater client retention. That could never be the case for a pure courier company rather than a business that manages courier services like The Mail Company.
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User-Based Service Monitoring
A possible solution is to limit the access of some staff to courier services. That can be achieved by establishing specific internal roles or types of request within an organisation that exclude costly services or require a line manager’s approval for special deliveries. That is not only a way to control costs, but it also ensures that services are used responsibly.
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Spending Limits and Alerts
For clients who are concerned about overall spending, it is possible to have spending caps for each location or department that trigger alerts when spending approaches them. In that way, there are no unpleasant surprises and the client maintains an iron grip on spending.
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Data Analysis and Decision-Making
A complete solution provides detailed information and supports decision-making on the basis of patterns of actual spending. Individual members of staff and departments that generate higher costs can be rapidly identified and their pattern of spending rectified, if need be.
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Monthly Management Report
Finally, the submission of monthly management reports to clients is key. Those reports by The Mail Company’s service managers provide a complete overview of spending, incidents and other key metrics. They keep clients up to date and allow them to take spending decisions based on data and figures.
The Future of Courier Service Management
Many businesses still see document logistics services as a support function, and so they are not willing to invest in innovation in document logistics. That can readily be seen in the simplistic methods that many businesses are still using to control their spending on mail and courier services.
An example of that is when people wait to the end of year or the expiry of a contract to ask for a lower price for the same services. Another basic approach is to use reverse auctions, in which providers of mail and courier services compete to offer the lowest price.
The Mail Company is working to change that mentality and show businesses that courier services can be managed more efficiently through digitisation, to give lower costs with no loss of quality and so make courier services better value for money.
A good example of that is one of our clients, one of the leading online banks in Spain, where we implemented the GIO platform. Although in the procurement process we were more expensive on a per item basis than courier service providers, we won the contract. Once GIO had been implemented to manage document logistics, we were able to confirm that in terms of absolute spend ours was the most affordable and most efficient offering for our client.
We see a promising future for document logistics. Some of the changes that we expect to see are:
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Overcoming reluctance to electronic signature
We believe that physical courier services will be progressively rationalised as people adopt more efficient ways of working and overcome the reluctance to use electronic signature caused by today’s lack of understanding of the legal and security picture. Digital signature has the same legal status as traditional methods. Education around this topic is essential to overcome people’s reluctance.
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Improved User Experience
We can see a future in which people have access to virtual assistants that guide them in their selection of courier services and provide a more complete user experience. Those virtual assistants will be able to make recommendations based on a user’s specific needs and the type of delivery. And improve the efficiency of the dispatch process and, for example, ensure compliance with customs formalities.
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Metrics and Dashboards
We also believe that we will see the development of tools that provide more sophisticated, visual KPIs and metrics for courier services. Those tools will allow businesses and service managers to have more complete oversight of the process of document dispatch with a 360 view, and so lead to greater efficiency and fewer misdeliveries.
The Mail Company would love to be your partner in the search for efficiency in your document logistics. Contact us and let’s start to work together to achieve your goals.
