The cost to businesses of failed home deliveries in the UK alone topped £850 million in 2011, a rise of 7.5 per cent on the previous year.

The figure has been arrived at by the Interactive Media in Retail Group (IMRG), which issues a two-yearly report into the subject, designed to show online retailers the costs incurred when deliveries don't meet customers' expectations of being 'on-time, first time, every time'.

 "This data allows the industry to consider what can be done to eradicate delivery failure and maintains the momentum of service innovation and development on the supply side and deployment of new solutions by e-retailers," says the IMRG in its introduction to the latest report.

The report focuses on the costs incurred in any one of six scenarios where a delivery fails, ranging from a failed first delivery, requiring goods to be re-delivered, through to an order being lost and a customer cancelling it as a result.

Andrew Starkey, head of e-logistics at IMRG, commented: “The actual fulfilment of an online order represents the final hurdle for retailers and a negative experience at that point provides the impression that lasts.

"As these figures demonstrate, for retailers it is not just brand reputation that is impacted when a delivery is missed but the associated costs of that failure can also be significant.

He concluded: "It is perfectly possible to let consumers know where and when their parcels will be delivered. It's all about improved communication between the retailer, the carrier and the consumer to ensure delivery occurs right first time."