Home › Logistics and delivery in the Nordics
The Nordics present some interesting logistics issues for retailers wishing to reach all of its consumers with a total population of approximately 26 million spread over an area of 120,000 sq km, including hundreds of islands. However most of the population is concentrated in the south and in coastal areas.
Figure 39: Urban rural typology based on urban ranking, population, density and land cover Source: www.nordregio.se
Non-Nordic retailers have a number of ways to reach this market.
Direct Link is a fully-owned subsidiary of PostNord, the merged Swedish and Danish post offices, offering a gateway to the Nordics through customised B2C delivery and distribution solutions. It can reach 100% of addresses in all four Nordic countries and offers a choice of options with light goods directly to the customer’s mailbox, a collection point or home delivery with a ‘leave in safe place’ option.
Direct Link operates facilities in the UK, Germany, Poland, US, Hong Kong, Singapore and Australia providing services with the following transit times (subject to point of origin):
» Fully tracked with SMS & email notification.
» 1 to 3 day delivery for items between 0-20 kilos.
» Available as a PUDO option (MyPack Collect) and also for home deliveries (MyPack Home) in all four Nordic countries.
» Insurance up to 520 Euros
» Integrated returns. Returns can be dropped into a service point or collected from a chosen address
PostNord will launch further new features in 2017 including MyPack Small, delivered directly through the mailbox, ‘Flexi-change’ where customers can change the receiving address of their parcels mid journey - and ‘Digital ID’ as a secure alternative to physical identification checks.
In addition to using the local postal service provider as the final delivery agent, retailers will be able to access services through their own domestic postal providers.
From the UK for example, Royal Mail provides the following service options / delivery time ranges which vary by country (example – small parcel weighing 500 grams and valued under £20):
Note: Royal Mail services have a 2 kilo maximum weight limit.
There are a number of global carriers able to provide collection, distribution and delivery into the Nordics (using their own operations or local partners). The main ones are:
UPS - Offers a range of services and delivery times to the Nordics subject to country of origin and the specific destination
Fed Ex (now incorporating TNT) – Offers services to the Nordics ranging between 1 and 3 days subject to the service selected and the country of origin.
DHL – Offers one main service option, namely Export Express Worldwide, guaranteed delivery by the end of the next possible working day. As an example, from the UK to the Nordics this will typically be the next working day subject to the exact delivery address.
DPD – DPD is particularly of note in the Nordic market because PostNord (the postal service provider for Sweden and Denmark) is a strategic partner and its delivery partner in all four countries. It offers a range of service options to the Nordics with the examples below showing transit times from the UK in business days:
Denmark: 3 to 4 days
Finland: 4 to 6 days
Norway: 2 to 6 days
Sweden: 4 to 6 days
In respect of online retail deliveries perhaps the two most interesting services are:
In addition to the global carriers above (which will also be domestic carriers in most markets), in many countries domestic carriers based in the retailer’s own market will often accept online retail orders and ship them to the Nordics.
Domestic carriers will sub-contract the onward shipment, often to the global carriers or postal service, but for a retailer with a contract with a domestic carrier this can be a natural starting point for accessing services to the Nordics. Retailers already having a service contract with a domestic retailer should start by finding out what options they provide and can use this as a benchmark.
Service times will vary depending on the line haul arrangements in place and the service partner chosen but taking the UK as a benchmark, might be 4 to 7 days.
Direct access describes a solution used to consolidate volumes from different senders to achieve better air transport rates. Consolidated orders are shipped to the destination country where they are handed to local partners for the final delivery.
Direct access operators provide a managed service that can include:
Where a retailer has sufficient volume to be able to contract with a direct access operator there is the opportunity to get a ‘courier’ level service at less than ‘courier’ prices, usually paying a per consignment + per kilo rate.
There are a growing number of companies providing such services to the Nordic countries. In the UK for example these include DPD Direct (all countries), wnDirect (Denmark, Finland and Sweden) and P2P Mailing (Trak-Pak – all countries – delivery range 3 to 8 working days’ subject to the specific destination and carrier / service used).
Parcel brokers provide smaller retailers with a way to access better pre-contract rates through postal operators, global and domestic carriers and direct access providers.
Parcel brokers do not offer all carrier options, only those that choose to contract with them, but in the UK for example companies such as Parcel2Go and Parcel Monkey provide this channel into the Nordics using most of the carriers mentioned above and others including Asendia and World Economy.
Retailers with a reasonable volume of orders going to the Nordics may wish to consider the option of parcel management service integrators who can provide immediate integration with a wide range of service providers delivering into the Nordics market. These will include most of the options already listed (excluding parcel brokers) and many others.
The retailer will need to have or enter into a contract with the delivery service providers they choose but then the integrator will offer the ability to allocate orders to the most appropriate service – using agreed business rules – printing labels and customs documentation, providing tracking and helping to manage returns. For smaller retailers some integrators also offer their own parcel broker option that can help obtain better rates.
Providers of such services include MetaPack, ITinSell, Electio and Consignor which particularly serves the Nordic market and with whom PostNord and Direct Link specifically offer all their services.
The delivery operator selected will be able to provide full details and advice on the necessary documentation and processes and some can go further by pre-clearing orders while the goods are in-transit or at the start of their journey using a consumer duty paid process. This can be done using the HTS code assigned to each product category and can reduce delivery times and remove a potential barrier of having the goods held when they arrive in country.
Retailers are therefore advised to specifically ask what their chosen delivery partner can do to facilitate customs clearance and duty calculation / collection.
Online retailers looking to enter the Nordic market should be aware of any particular packaging requirements, though depending on the specific goods being exported, these requirements can vary greatly and, depending on the industry, regulations are often administered and enforced by different government bodies.
When contemplating packaging rules and standards, retailers should refer to the packaging regulations for their specific industry.
Any retailer wishing to win sales from Nordic consumers needs to appreciate the delivery services that are provided to them by domestic Nordic retailers because these will provide direct competition.
The local postal services will be widely used by local retailers:
PostNord was formed as a merger between Post Danmark (Denmark) and Posten AB (Swedish Post) and now provides domestic ecommerce delivery services to both countries:
Posten Norge (Norway Post) provides services to online retailers through its Bring brand which extends across all four Nordics countries, accessing the local services in each country and branded as follows:
For its ‘home’ markets of Norway and Finland, Bring provides its home service which offers a fixed price per parcel:
Norway – only available to the larger cities in Norway.
This B2C option should be compared for service and price against the general parcel service, available through the post office offering a standard 2 to 3-day delivery although some areas take up to 5 days. It is normal for the recipient to collect the parcel from the local post office or post in shop although for an additional charge, delivery to the door is offered.
Home delivery is provided in most towns and cities for delivery between 09:00 and 17:00 on a day pre-selected by the customer. For this service option the customer will receive notification that the order is on its way and, on the day of delivery, a call 30 - 60 minutes in advance of delivery.
Both home and pick-up service options come with full tracking but unlike the collection option, Cash On Delivery (COD) is not available for home delivery.
Finland
Bring does offer a number of optional services to support its business services above, including:
Posti Group (Finland Post) provide both home delivery and pick-up options for the Finnish ecommerce market.
Home delivery services are offered at a price premium in Finland:
The lower cost option is usually for the customer to collect their parcel:
SmartPost uses Posti Parcel Points – lockers where customers can choose to have their parcels delivered. Some shoppers may already have registered free for the My Pick Up Point option to have all of their parcels delivered to a particular locker location. Currently only available in Helsinki and Utsjoki although the network is being extended.
Due to the geography and population dispersal in the region, there are often exceptions to delivery standards, services offered and price differences. As such a cross-border retailer serving Nordic customers must take care to accurately reflect its service offer, carefully signposting where the customer can find this information. It is good practice to make such information easily found from the homepage and each product page and certainly before the customer reaches the checkout stage.
In addition to providing delivery services, some of the companies above offer services for cross-border online retailers with sufficient volume to take advantage of them; including third-party logistics, local marketing and customs clearance (Norway in particular).
Any overseas retailer must consider their delivery offer against the context of this local service landscape because this influences the needs and expectations of Nordic consumers.
When a retailer is deciding on the delivery offer to provide it is important to consider the needs and wants of Nordic online shoppers and to recognise that as an importing retailer it is competing with domestic retailers already meeting these needs.
Overall, Nordic consumers expect to get deliveries within four days of order but, as with most markets the trend is for this to be reduced. Recent research by PostNord has seen the average expectation fall from 4.3 days to 3.29 days between June 2015 and June 2016 with Danish consumers being the most demanding. Evolving consumer expectations by country are:
Source: PostNord E-commerce in the Nordics 2016 and 2017
Although some sort of delivery to home is the preferred option for most consumers, Nordic shoppers are prepared to be more flexible in their use of alternative delivery services than most other developed ecommerce markets. A retailer wishing to serve Nordic consumers should recognise that they particularly want a choice between home delivery, PUDO / locker and postal (letterbox) options.
Source: PostNord E-commerce in the Nordics 2017
This data suggests that when delivering to home the ability to leave the parcel in a mailbox or other safe-place is important and there should be an option for the customer to provide delivery instructions. Delivery requiring a signature, when someone must be at home is significantly less popular, perhaps because many of the local delivery providers require the customer to agree to a fixed day and time.
In order to accept online orders when they are not home, Nordic shoppers are significant users of click & collect solutions where, manned PUDO locations are the most popular. The exception is Finland where Lockers and PUDOs are used about equally.
Unlike some other markets such as the UK, click & collect from the retailer’s store is not widely used, perhaps due to the concentration of major retailer brands in the main conurbations.
Click & collect service providers in the Nordics with whom shoppers are familiar include all those shown in the section above. At the time of writing the main cross-border click & collect networks operating in Europe – namely UPS (Access Points), DHL Lockers(PakStations) and myHermes Parcelshops – do not have a presence in the Nordics.
As further evidence of Nordic consumers’ willingness to use alternative delivery options, they are amongst the first to start using ‘in-car’ delivery. This is where the delivery carrier is authorised to use a digital key to open the boot / trunk of the customer’s car and leave the parcel.
The customer must register for this service and provide an approximate location for where the car will be on the day the delivery is expected.This allows the carrier to route the parcel to the right local depot. From there the driver is guided to the exact location by GPS.
This solution is being pioneered in the Nordics by Volvo and, following limited trials, has been commercially available in Sweden since November 2015.
EU consumers have a statutory right to return goods within 14 days which means that as well as it being good practice to provide a transparent and efficient returns solution, there is a legal imperative too. The most recent research from Post Nord (Post Nord e-commerce in the Nordics 2017) confirms that about one in ten shoppers typically return at least one item a month. Finnish consumers seem to be the most active returners in the region with 14% claiming a monthly return. This seems to be encouraged by the fact that they are the most active users of automated parcel lockers which can also be used as drop off points. When selecting their delivery partner for the Nordics, retailers should find out what arrangements they can make for returns.
Nordic consumers will need:
» PostNord MyPack Returns – drop-off locations – all countries
» BRING Pick Up – ad hoc returns collection – all countries
Some operators will arrange for the return to be sent back to the country of origin where it can be delivered back to the originating retailer to be processed:
Building on this is the option for returns to be fully processed in-country and some operators may provide in-country returns centres where the return can be locally validated, quality controlled and the refund issued. This then may allow consolidated orders for return to stock, disposal or even, when there is sufficient demand, for the goods to be retained in-country and used to fulfil another local order.
To help retailers manage the returns process these same operators are developing white label / multilingual returns portals matching up the original order with the return.
Such portals make it is easier for the customer to make returns, offering multiple payment options such as customer- or retailer-paid. The customer can print the label, see when a return has been received and when their refund is due.
Operators providing portal solutions in the UK include wnDirect, ReBound, Zig Zag and MetaPack.
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