It is estimated that we spend roughly £136 per household, per year on delivery charges, it may be that we are paying too little. Though shoppers tend to be of the opinion that delivery charges are too high, retailers may actually be footing the majority of the bill, especially when it comes to grocery.
Sainsbury’s for example, currently charge between £2.75 and £6.95 for a grocery delivery, with Tesco similarly charging between £3-6. However according to analysts Shore Capital Stockbrokers, the process of choosing your items, bagging them and delivering them to your door costs closer to £20. They believe that the service is seen as more of a gimmick for retailers rather than a way to make a profit; in order for the service to become profitable, retailers would need to charge closer to £15 per delivery.
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Dislikes of online grocery shopping among online grocery
shoppers - 2011
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With the number of shoppers who are opting for online delivery for their main shop increasing year-on-year (over half or all shoppers now shop online at least occasionally), analysts claim that in-store shoppers are subsidising the retailers loss in revenue by increasing the cost of the food itself.
Of course if this is the case and retailers do increase their delivery changes substantially (which is unlikely in the near future), the retailers that do not increase their delivery charges will likely see an increase in orders with shoppers switching their loyalties. Currently, half on online shoppers cite the cost of delivery as their biggest dislike of online shopping (see graph), and 80% say that free delivery would increase their frequency of use of this channel.
We investigate online shopper loyalty, the barriers to online shopping, and much more in our upcoming report ‘Online Food & Grocery: The Shoppers Perspective 2012’.
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