Learn how to build a fulfillment network optimized for 2-day UPS Ground to meet your customers’ expectations for fast shipping without hurting your bottom line.
1 to 2-Day Delivery Is the Expectation
It’s no secret that fast shipping is a growing consumer expectation — and thanks to the Amazon effect, consumers are defining “fast” as 1-2 days. In fact, a recent consumer survey revealed that 45% of shoppers expect a 2-day shipping option regardless of which online marketplace they are shopping. And according to research from McKinsey, 90% of consumers expect free 2- to 3- day shipping.
But all merchants know that free shipping for consumers is not free for businesses. In a highly competitive marketplace, faced with changing consumer shopping habits, how can brands meet consumer expectations around ecommerce fulfillment and delivery without sacrificing margin?
In fact, where 1- to 2-day shipping may have been a competitive differentiator in the past, it is often now simply a baseline expectation for most online shoppers.
Why Most SMBs Don’t Offer 2-Day Shipping
According a recent merchant survey, 75% of merchants know that offering 2-day shipping will make them more competitive, but only 60% actually offer it. Most merchants indicated that cost was their main obstacle to offering 2-day shipping to their customers — 33% reported that the expense of shipping next-day air kept them from offering faster shipping options.
For merchants that are shipping orders from a single location (such as an office or local warehouse), next-day air might be the fastest way to reach customers on the other side of the country. However, it’s not a cost-effective option to leverage long-term. Ground shipments, on the other hand, are much more affordable. However, a merchant fulfilling from a single fulfillment center on the West coast, for example, may take up to 6 days to deliver to a customer on the East coast via ground.
So then, given that air delivery is probably too expensive and standard ground delivery is often too slow, how can merchants create a distribution network that guarantees 1-2-day delivery speeds for the entire U.S. without having to over-paying for expedited shipping?
Ware2Go’s 2-Day Ground Network
Most small to mid-sized merchants looking to outsource their fulfillment start with a 3PL. However, 3PLs are typically regional providers, and in order to establish a nationwide footprint, growing merchants end up cobbling together multiple 3PLs.
Managing multiple 3PL relationships can complicate the supply chain and eat up internal bandwidth. O2 recovery drink found that in order to simplify their supply chain, they needed to streamline their fulfillment with Ware2Go.
Ware2Go provides on-demand warehousing and fulfillment that guarantees 1-2-day UPS ground delivery speeds across the entire U.S.. Ware2Go’s solution uses the following strategies to build a custom network to help merchants reach all of their best customers with affordable 1- to 2-day ground shipping.
Building a Custom Network
Ware2Go’s free network analysis tool, NetworkVu, enables merchants to sync their ecommerce shopping cart or upload their own sales and shipping data to see recommendations of where to place their warehouses to best achieve nationwide 2-day ground shipping.
Strategically Allocating Warehouse Space
Based on their NetworkVu analysis, Ware2Go positions merchants’ inventory in the warehouses that can provide the most effective coverage. Typically, merchants that require 1- to 2-day delivery across the entire U.S. will need to position inventory in three warehouses. But because Ware2Go offers pay-as-you-go storage space with monthly fees, the costs of leveraging these facilities are very low.
Industry-Leading Service Levels & Same-Day Fulfillment
Everyone knows that consumers start running the clock on 2-day delivery from the moment they press pay. Ware2Go’s industry-leading service level agreements (SLAs) include same-day fulfillment for all orders dropped before 3pm local warehouse time. That means most orders dropped are packed and picked up for delivery the same day a shopper places an order.
Providing Guaranteed 1-2-Day Ground Delivery
With advanced order orchestration logic, our fulfillment technology automatically routes each order to the warehouse closest to the end consumer to enable 2-day ground shipping. As a UPS company, we can provide our merchants with preferred UPS pickup and guaranteed ground delivery times through the most reliable carrier in the US.
Visibility, Control, and Flexibility
Ware2Go’s integrated Warehouse Management System (WMS), Transportation Management System (TMS), and Order Management System (OMS) gives merchants full visibility into order and fulfillment statuses, on-time fulfillment metrics, and inventory levels across all of their warehouse locations and sales channels. And because the entire model is “on-demand”, merchants can adjust their usage of our services at any time in-line with their seasonality or the shifting needs of their business.
How Aloha Leveraged Nationwide Ground Shipping
When plant-based protein brand, Aloha, decided to scale their direct to consumer sales, they used Ware2Go’s network analysis tool, NetworkVu, to build an ecommerce fulfillment network that would meet their customers’ shipping expectations.
NetworkVu recommended a three-warehouse network, which enabled Aloha to reach 98% of their customers with 2-day ground shipping. They found that offering 2-day shipping on their ecommerce site not only improved customer satisfaction but actually grew their top-line revenue.
Today’s ecommerce consumers are highly influenced by what Google Shopping calls “The Power of Now” when making purchasing decisions online. In fact, a recent survey revealed that 65% of merchants saw increased cart conversions of up to 25% when they offered 2-day shipping at checkout.
Additionally, 22% of merchants reported that offering 2-day shipping helped them beat out their competitors. Ultimately, between re-vamping their ecommerce website and offering affordable 2-day shipping to their customers via their ground network, Aloha has seen a 300% increase in D2C revenue.
Build Your Own Nationwide 2-Day Ground Network
Thinking about building a 2-day ground network for your business but not sure where to start? Ware2Go’s network analysis tool, NetworkVu, uses your own shipping data to show you exactly where you should be stocking inventory to lower time in transit (TNT) to affordably meet your customers’ 1- to 2-day shipping expectations. Manually upload your own order data or connect your Shopify or BigCommerce shopping cart via the NetworkVu app.
