This article will help you weigh the considerations when it comes to setting the appropriate processing time for your items. A good processing time will strike a balance between reliability and speed.
There are significant benefits to being fast, but reliability is also vital.
How is the end customer promise calculated?
You can set a default processing time at a warehouse level that applies to all your items, or you can choose to set a processing time separately for each of your items.
In addition to that default, noon will add some additional time to cover the logistics legs from your warehouse to the customer. This will vary depending on the customer location and the location of noon's hubs associated with your warehouse.
Best practices when setting your processing time
Make sure you can achieve it
You should ensure that you can deliver almost all your items to the drop-off center or have them ready for handover within your designated processing time to avoid the risk of penalties or a decrease in your "ready on time" rating.
Especially when starting out you should consider a longer processing time so as to avoid hurting the reputation of your store.
But don't be too conservative once you have the hang of things
If you are able to sustain a high ready-on-time rate with your current processing time, then we highly recommend trying to reduce your processing time.
We find that cancellation rates and on the door rejections, all start to increase as processing times get longer than three days. If you can maintain an aggressive processing time you may even see an uplift in sales from customers who prioritize speed.
The majority of our items are sold for customers with a delivery estimate within 3 days of the purchase date.
The majority of our undeliverable items have been initially sold with the expectation they'd be delivered more than 2 days later, which means customers are more likely to reject a delivery with a long estimate.
Customers are twice as likely to cancel an item that's fulfilled in 5 days as opposed to 3 days. They are more than 3 times likely to cancel if fulfillment is above 10 days.
Be aggressive where you are very confident
If you have items that you can deliver very quickly and with a high degree of reliability then you can assign these items a shorter processing time which should lead to an increase in sales and even further reductions in cancellation and rejection rates.
A same-day promise can mean next-day delivery in some cities depending on cut-offs which can significantly improve conversion and offers an alternative to being in noon express.
I see that some items have a delivery estimate range, how does that work?
If you find a delivery estimate range instead of a fixed date this means that you are typically delivering items faster than the processing time you selected.
The faster estimate is applied based on the time it takes to deliver the vast majority of your items. If this is faster than your stated processing time then the lower end will be displayed.
Your store's reliability will be judged based on the later promise as this corresponds to the processing time you set for the item.
Customers are somewhat more likely to purchase if they see that the lower end of the range meets their needs. However, the greatest increase in purchasing is seen when there is a single, fast delivery promise so if you see this happening you may want to reduce your processing time altogether.