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The decline of the milk delivery to the doorstep in the United Kingdom has been bemoaned by only very few. The new ways of shopping and the new prices in supermarkets and superstores meant that it was not really that attractive to have the milk dropped off at the doorstep every morning. Some milk firms have fought back by extending the range of goods handled so that the milkman now delivers bread, juice, cling film and the Home and Life magazine. Nonetheless today the milkman’s operation is a mere shadow of its former self. |
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But now, with the arrival of e-retailing, there is a chance for the milkman to fight back and become the e-milkman – and maybe like good old Ernie, become the fastest milkman in the West, East, North and South. The Achilles heel of e-retailing is the fulfilment of the purchase i.e. getting the goods to the doorstep or the home where it is required. It is actually easy enough for an e-retailer to set up and attract some business. The challenge really comes in getting the goods to the customer at a reasonable cost and in a reasonable time. No matter how you look at it this is a major problem. It’s easy enough for e-Businesses such as Amazon.com to pass over to the client the cost of fulfilment, as it is sort of customary for the purchaser to pay for postage and packaging on the acquisition of books and such items. However how does the supermarket or the department store do the same when it is not the custom to so do? The sort of fee charged by online supermarkets of around £5 per order can hardly go much of the way to paying for the picking and packing and the delivery of a sizable order, and the same £5 is of course far too much for the buyer to add to a small order. This conundrum is the main obstacle to e-retailing. Clearly what are needed are some specialist fulfilment organisations. One such firm is M-box that offers a solution to this challenge. According to their publicity material on the Web, M-box has been built to revolutionise the cost and convenience of home shopping for retailers, manufacturers, start ups and consumers and in so doing M-box is bringing back the old fashioned values of service. They intend doing this in such a way that the cost of servicing the home is the same as the high street. Express Dairies But is it real? Or is it just the pipe dream of those hoping to find an angle to benefit from the Web. It’s very hard to know. Firstly the new alliance between Express Dairies and M-box certainly creates a vehicle by which some goods can be delivered to the doorstep. But how much space is there on an electric milk float? Also, although the milkman’s rounds are to a large extent a fixed cost to Express Dairies there will still be some variable cost. The milkman himself will want something for lugging the goods to the doorstep. The goods will still have to be picked and packed from the warehouse and the warehouse is not the same as Express Dairies’ 150 depots and so there is the transport to these places too. Wake-Up Call? It certainly seems that the Express Dairies and M-box joint venture should be congratulated for being a move in the right direction to tackle the fulfilment conundrum for e-Business, but perhaps more work needs to be done on working through all the implications for bringing the e-milkman into the equation before an optimal solution is arrived at. Professor Dan Remenyi is an e-Business consultant and author of several books on the subject of how to improve organisational performance through the most effective employment of IT. His latest book is called The Effective Measurement and Management of IT Costs and Benefits. Dan is contactable on Remenyi@Compuserve.com |
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