Offering delivery services to your customers is advantageous to growing your business, however it's key to find the balance between happy customers and a happy business.
We’re here to help. Here are 6 steps to help your business plan a delivery schedule that helps to maximize profit:
1. Re-assess your current logistics plan
The first step to maximizing profit is to assess your current distribution plan:
- How often are you delivering product and what is the profit per delivery or are you losing money on delivery?
- What is functional and what is not?
If you create an overview of current operations, it is easy to point out which areas need improvement. If you currently do not offer deliveries, you need to determine your distribution capacity.
2. Determine your distribution capacity
It’s time to take it from the top. Consider the region you can reach, the frequency per week you can delivery and size of order you are able to transport and create a plan that outlines these actions. Before considering what your customers want, consider what you are able to provide.
3. Consider the needs of your customers
Consider the types of customers you have.
- Should you offer delivery to all customers?
- Where are your customers and where are potential other customers?
If you plan your delivery schedules around the needs of your customers and your distribution capacity, it will help you to profit from deliveries.
4. Set a minimum order value that increases profit
Minimum order value (MOV) is the lowest dollar value that you will ship to your customers. This blog post explains how to calculate this value for your product. Set your order minimum value to increase your profit. This will ensure that you are getting a profit for providing direct-delivery.
5. Implement pick up locations
Pick up locations are a great way to service multiple customers at once. In another blog post, we broke down how pick up locations can save you money on deliveries. Use the blog post to determine if pickup locations are an option for you.
Co-loading is the coordination of vehicle distribution routes from different suppliers to bring products to their buyers. It allows you increase your shipping area, saves you money per delivery, fills your loading capacity, and helps to reduce emissions from your distribution route.
If co-loading interests you, this blog post outlines how to implement it in your distribution plan.
Nina Galle writes blog posts, templates, free tools, and other helpful resources for farmers and markets.