Online & Digital

Solid first-quarter growth for online retail orders

Online retail delivery order volumes were up 9.6% year-on-year in March, according to the latest data from the IMRG MetaPack UK Delivery Index.

This completes what has been a solid first-quarter for online retail order volumes, with total growth for the quarter increasing by 12.5%, just short of the 13% forecast for 2018 as a whole.

Over the same period, online retail sales revenue growth was up 15.4% .

The first week of March featured heavy snowfall across the UK, which created significant challenges for online retail delivery operations. As a consequence, on-time delivery performance for March 2018 was a full seven percentage points below the rate recorded in March 2017.

The dip in on-time delivery performance is not just related to the weather however – with the exception of January 2018, it has been below 90% since July 2017, with the rolling weighted average over the past 12 months standing at 88%.

The most likely driver of this over the longer-term is the greater use of next-day delivery, though the index showed that there is some evidence that this shift may be reaching a plateau.

The percentage of orders using next-day services has grown in March for the past five years, however this year next-day accounted for a higher share of orders than economy, but was proportionately smaller than in March 2017.

Andrew Starkey, head of e-logistics, IMRG, said: “Despite all the issues being experienced on the high street, growth for online retail order volumes in 2018 has experienced a solid start to the year. Easter was early this year (falling in March, while it was in April in 2017) so it may be that next month’s results record a bit of a slowdown but, if so, that would likely be a blip.

“The evidence is that retailers are increasing the rate at which they evolve their operations to cater for an ever-more demanding customer – such as in the opening of highly automated warehouses by some large retailers, including Shop Direct and Sports Direct. We can probably expect to hear more such announcements over the next 12 months.”

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