The majority of Argentinians will wait for free delivery according to Accenture

13 June 2018 Authored by Consultancy.lat

Over three quarters of Argentinians are willing to wait extra days for flexible last-mile delivery compared to roughly a third of the greater European population.

In Europe ‘fast and free’ delivery is becoming the industry standard. However this is not enough to engage European consumers who are placing an increasingly heavy weight on control and choice. Whilst Argentinians are no different to their European counterparts in their wants, the e-commerce boom for the Latin American country is just beginning. 

According to Accenture Argentina, this presents businesses and start-ups with a gap to fill in the market. In a recent report titled ‘Reroute Your Strategy for Last-Mile Delivery’ the strategy consultancy identifies both European and Argentinians’ attitudes towards online-shopping based delivery services.

The respondents to the survey said that they were willing to wait if it meant that they did not have to pay for delivery services. With over 77% of the respondents stating that they would rather wait, this presents a significant divergence from the European survey, wherein only 36% responded in the affirmative to the same question. 

This is a result of the relative infancy in which e-commerce is in in Argentina due to decades of import restrictions and economic uncertainty. During this time, importing goods from abroad was extremely difficult if not impossible without US dollars and the country lacked a solid online payment system. 

However online shopping is tipped to grow alongside the country’s economy, which is improving due partly to President Macri’s reforms. Ignoring the recent spate of inflation and focusing on the long term game, Argentina is likely to see a major shake up in its last-mile delivery systems, which are consistent with a global trend.

Delivery services in Argentina must adjust to the desires of the consumer who are willing to wait for free delivery

"Today’s consumers want practicality, for example, having greater control over delivery parameters and more choice of delivery options,” states the report’s authors in regards to European consumers. “Now, people want to select the exact time of day for delivery, location (residence, logistics hub, retail store or office) and the number of parcels.” 

Although this kind of complexity may be a factor in Argentina too, price is overtly important for Argentinian consumers when it comes to delivery. Over half of Argentinian online shoppers are not willing to pay more than ARS $100 ($3.90) for online delivery. In Europe this number is at 44% which does not represent large difference between the two counterparts and identifies the fact that “speed at low to no cost has become a requirement”.

For Accenture, this represents a significant business opportunity for those who are willing to navigate this market. “Current logistics networks aren’t built to handle the rising complexity and new demand, which is increasing more than 10 percent year over year.”

Increasing the volume of low cost delivery systems requires an increasing level of logistical services such, including more hubs within urban areas – leading to shorter delivery times, reinventing hubs to become more efficient and greener and adopting new approaches such as cross-loading which reduces the need for storage. 

According to the consulting firm, reinventing the last-mile delivery service will be a lucrative endeavour if done correctly. More consumers demand flexibility and choice in their delivery services, but are unwilling to pay for it in Argentina. As delivery services and postal companies enter into this new era of e-commerce, they must adjust their practices or “risk being replaced by governing bodies or retailers.”

On twitter Accenture Argentina commented saying “Consumers want more control and options to choose from. As such, logistics providers must completely rethink their logistics strategies.”

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