Increasing the lead time to ship dramatically reduces sales

80% drop in sales by increasing lead time.

[lgn1]

We were quite swamped, and this is our busy season. We generally have a 24-48 hour lead time in getting packages out the door. Our shipping system allows us to specify the lead time.

We were getting tired of customers calling, asking where their order was, so we increased the lead time to a week, to give us some breathing room.

That was a mistake, our sales have dropped by 80%. We could not believe it. We thought it was a blip, so we kept it that way for 2 weeks. We have factored out all other factors. Traffic is steady, no increased competition, and we have 5 years of seasonal stats to go on.

Needless to say, with a 80% drop in sales, we are caught up. Anyways it has been switched back to 48 hours.

I can't believe that people are so fickle about lead times. Anybody else encountered this.

[lgn1]

The good news, is sales are back to normal, after I decreased the lead time back to 48 hours.

So I guess the rule is 'it is better to mention delays after you make the sale, not before'

[SkyDog]

Yes, unless it's something they can get just as easily somewhere else, turnaround time is important.

[Rugles]

Very interesting. Thanks for sharing that with us.

[Jon_King]

I had the same effect lgn1, in my case we made no mention of shipping time so I added the line:

"In stock and ready to ship. Orders are normally shipped within 24-48 hours."

...and the sales went up dramatically.

[kevinpate]

[consumer hat]
If I have a week available for something to simply start the process of making its way to me, I have little reason to purchase that item online from a stranger instead of selecting the best value available from amongst the local merchants recommended by friends. Conversely, if I'm time crunched and it's both in stock and expedited shipping is an option, ka-ching! someone's probably just nailed a sale.
[/consumer hat]

[The Grizzler]

From Day One we have shipped all orders same day before 3pm.

We remind customers of this right through the site and it's one of the reasons they buy from us. (According to the comments they leave).

We ship everything free by default but we started offering guaranteed next day at a very small premium.

Result... Increased sales.

Customers will pay a modest fee for quick turnaround.

[pdivi]

I read this thread and suddenly realized that none of my sites mention lead time...even though we usually ship same day. I just fixed the problem.

This forum is an incredible resource.

[lgn1]

We were always quite competitive on price, so we figured the customer was willing to wait. Boy was I wrong.

Same day shipping did not make sense to us, as we would be required to carry over 5000 different SKU's, so we used an (almost just in time inventory model, which added 3 to 4 days to the order fullfillment process).

Thats why we are switching over to drop shipping, so we can get the product out, within 24 hours. The drop shipper is also next to the US border, and they will be feeding the parcels directly into the Fed Ex/UPS/USPS system also, on a daily basis. This will put our Canadian company on a equal footing with our American competition.