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FedEx and UPS Increase Surcharges Again as Pandemic Continues to Impact Shipping

The significant growth of online shopping propelled by the outbreak of the COVID-19 pandemic doesn’t seem to be letting up. While some aspects of life have returned to pre-pandemic levels, the impact of the virus continues to put a strain on shipping, generating elevated volumes, high demand for capacity, and increased operating costs for carriers. As such, both FedEx and UPS have announced additional peak surcharges due to the pandemic’s continued disruption of the shipping industry.

Effective June 21, 2021, FedEx will implement percentage increases to three delivery surcharges, including an additional handling surcharge, a residential delivery surcharge, and a peak surcharge on Ground Economy.

Recently started on May 23, the UPS surcharge increase now applies to certain international shipments originating from Asia, including Hong Kong, China, Taiwan, Korea, Vietnam, Malaysia, Thailand, Indonesia, Singapore, Australia, and New Zealand to the U.S. UPS increased prices for UPS Worldwide Express Plus, UPS Worldwide Saver, UPS Worldwide Expedited, and UPS Worldwide Express Freight, from these countries.

The changes from both carriers were classified as “peak” surcharges, which, as Modern Shipper notes, “underscores that in the unprecedented environment for package deliveries during the post-COVID-19 era, peak season is no longer associated with the Christmastime holidays but has become a year-round phenomenon. The sellers’ market for parcel-delivery services has never been hotter than it is today, and all carriers have as much traffic as they can handle.”

Control Costs with a More Diverse Transportation Network

For shippers looking to find a workaround, diversifying transportation networks serves as a valuable tactic to combat the peak surcharges. The persistent delivery capacity shortage and unrelenting e-commerce volumes continue to raise the stakes for many businesses. Companies that can invest in a cloud multi-carrier parcel shipping system that creates flexibility and diversity in fulfillment stand a better chance of keeping costs in check. To gain that flexibility and diversity, companies need greater access to more carriers.

Growing their carrier network can help any business effectively tackle these challenges by introducing more options and capacity into the parcel delivery mix. Implementing a multi-carrier shipping strategy can help businesses increase stability to quickly react to carrier surcharges and rate increases and effectively control costs.

Consider Regional and Last-Mile Carriers

Shippers should consider including last-mile and regional carriers in the mix for more flexibility to compete with the massive volume of business that national carriers draw from the market. In some zones, these regional carriers offer cheaper rates and perform better than UPS, FedEx, and other major carriers. Incorporating these carriers into rate shopping initiatives can decrease parcel delivery costs and transit times by providing greater flexibility to allow shippers to select local carriers in different regions that have optimal delivery networks for serving their customers.

When tied to just one or two carriers, on the other hand, shippers cannot reduce costs or supplement capacity. Having access to more and different types of carrier services can help retailers keep customers happy while minimizing the impact of surcharges during peak season and obtaining the best value for every destination, delivery date, and product shipped. To succeed in keeping costs low, shippers should aim to choose the best fit carrier and service for each fulfilled order and leveraging regional and last-mile carriers can significantly expand carrier service options to help achieve that goal.

Logistyx offers an extensive carrier network that includes dozens of regional carriers – including LaserShip, OnTrac, and Speedee Delivery – making it easier and faster to add and maintain carriers’ rates and services in a shipper’s carrier network. Our cloud multi-carrier parcel shipping system allows shippers to access and automatically compare different carriers’ rates to select the optimal carrier service for each shipment based on unique business rules, despite the continued demand for carrier capacity.

Contact us today to learn how Logistyx’s multi-carrier parcel shipping software can help your business manage a wide range of shipping scenarios and optimize parcel shipping to help control costs.

3 Ways Cloud-Based Shipping Software Unlocks Efficiency in 2021

When you think of the benefits of “the cloud,” ease of data storage and access may come to mind. But what about in shipping software? It turns out that “cloud-based” is poised to be the defining strategic feature of shipping software in 2021. In short, cloud-based shipping goes way beyond data storage. It means significant savings in labor and cost — not to mention stress — for businesses looking to fulfill soaring numbers of online orders and quickly ship high volumes through their parcel carrier networks.

Read on to discover the key benefits to consider when switching to an experienced cloud-based shipping software provider to revolutionize operations in 2021 and beyond.

1. Reduced cost & stress on the tech side of business

When thinking of complex shipping workflows, chances are “out of sight out of mind” is something your business needs. In shipping, the cloud-based shipping software providers do the hard work to keep some of the most tedious processes off your plate.

On-premise technology (the opposite of cloud-based) demands people and equipment to keep up with demand. Shippers must have their own physical servers to host the data and IT personnel to troubleshoot and run backups to meet demand and stay secure.

In 2020 and in 2021, your business may have slimmed down IT teams to weather financial shocks. This reality, plus an increase in ecommerce orders may leave you wondering how to ship more with less support.

How the cloud can help

With cloud-based shipping software, your team can simply manage the solution provider, which doesn’t require serious internal resources. The cloud provider companies integrate with your supply chain software and carrier network to do the hard work to host and manage shipping data, execute both outbound and inbound shipping workflows, and track parcel movements. These features keep your day-to-day stress-free knowing customers will get parcels on time without delivery disruptions. A good provider will manage things like:

  • Shipping costs, including rating and rate shopping
  • Shipping volume, including labeling and documentation
  • Shipping communication, including delivery alerts and troubleshooting
  • Shipping reports and analytics, including invoice auditing and rate simulations

A cloud model also means growing businesses will spend less money up front to get off the ground, revolutionizing speed to market for both small domestic companies and global e-commerce organizations alike.

2. Scalable, shock-proof capacity

Shipping is a dynamic industry. It needs to weather anticipated and unanticipated shocks — think of peak shipping season around the holidays or global health supply chain challenges during COVID-19.

For on-premise customers running their own servers, there can be serious pressure to stand up new carrier integrations, new shipping workflows, and new distribution centers or warehouses in the face of these shocks or peaks.  Beyond IT, it can also be hard to think about the cost, equipment, and personnel necessary to scale an on-premise technology stack to meet rising e-commerce demands.

How the cloud can help

Cloud-based shipping software grants you the magic combination of scale and breadth of capability.  The right solution will dynamically manage your growth, so you never feel pain during unexpected events or surges in demand. As you expand into new markets or simply take on peak season, the cloud-based technology can seamlessly scale your volumes from, say, 300,000 to 500,000 parcel shipments per day.

Better cloud-based shipping software means your system doesn’t crash. It also isn’t a partial or seasonal solution designed to only manage peaks or rushes. Its technical capabilities handle parcel shipping from start to finish in any shipping landscape, no matter whether your needs are basic labeling and execution or worldwide omnichannel order fulfillment analytics.

3. Ready for the interconnected future

Another key difficulty of shipping beyond supply chain disruptions? The emphasis on delighting the end customer. Conditioned by large, online providers’ innovative services, modern consumers now have high expectations of their shopping and order fulfillment experience.  To meet these expectations, it’s critical for businesses to decrease their lead times by fulfilling orders quickly, working with reliable carriers to maintain on time delivery rates, communicating real time updates on parcel locations, and offering simple returns processes.

How the cloud can help

A better software solution differentiates your business in the market — you can be known for delighting customers by delivering parcels on time and feeding accurate and timely information throughout the delivery journey.

Sophisticated cloud-based systems achieve this via a Control Tower and AI-powered Business Intelligence that empowers you to make better decisions regarding carriers. With a cloud-based Control Tower, you have full visibility into customer deliveries, including a complete picture of what’s happening with each shipment, so you can monitor carrier performance and respond rapidly to any issue or disruption.  An advanced Control Tower will even let you create smart exception workflows that enable automatic responses to transportation exception events.

Business Intelligence will then provide trend analysis reports to help with carrier selection and rate negotiations, identifying carrier delivery performance improvements and cost saving opportunities that enable you to gain a competitive advantage.

Take the Next Step

To learn more about the power of cloud-based shipping software, contact us to request a free consultation.

Tournament Sports increases order fulfillment flexibility

Logistyx’s software system has increased order fulfillment flexibility and speed for Tournament Sports.

Business Challenge

Canadian-based sporting goods company, Tournament Sports, is a manufacturer and distributor of brands such as Jackson Ultima Figure Skates and Atom Roller Skates. Tournament Sports ships nearly 50,000 cartons of products across the U.S. and Canada annually, with 20% of parcels shipped directly to consumers.

Winter is one of Tournament Sports’ busiest seasons, when shipping volume increases following heightened demand for customized ice skates and other specialized winter sports products. To improve order fulfillment efficiency, Tournament Sports sought better access and visibility into its shipping data to unlock insights and streamline processes.

Solution

Tournament Sports chose Logistyx Technologies’ multi-carrier parcel shipping software to optimize operations. The software removes the manual, redundant processes that decrease shipping line speed and create errors, enabling fast, accurate, and efficient shipment processing.

By integrating with Logistyx’s cloud-based solution, Tournament Sports removed the onus from its IT staff to maintain servers, data integrity, and disaster recovery, handing those responsibilities to Logistyx’s support team.

Logistyx’s software gives Tournament Sports access to a flexible library of carrier-compliant routing and rating tools for small parcel, less-than-truckload (LTL), truckload (TL), and regional parcel carriers. These tools help Tournament Sports automate carrier selection decisions for routing, rating, time-in-transit, and much more. Logistyx’s software also provides full visibility into Tournament Sports’ shipping data and auditing capabilities for better carrier rate negotiations and to unlock new efficiencies.

Results

Shortly after migrating to Logistyx’s software system in early Q4 2020 ahead of its peak season, Tournament Sports realized immediate performance enhancements to capitalize on order efficiency for its busiest season, thanks to Logistyx’s ongoing carrier-centric updates and increased agility.

Leveraging Logistyx’s automated shipping tools, Tournament Sports instantly gained access to regularly updated and accurate information on carrier requirements, rating, and reporting, helping increase efficiency in completing the cycle of tagging packages ready for shipping, including labeling, freight recording, and more.

Logistyx’s software system has increased order fulfillment flexibility and speed for Tournament Sports. With the enhanced capabilities and automation using Logistyx, Tournament Sports feels confident in Logistyxy’s ability to handle increased volume due to business expansion such as new locations and growth of its product base in the future.

Retail Success: What Does a Cloud Multi-Carrier Parcel Shipping Solution Have to Do with it?

A Cloud Multi-Carrier Parcel Shipping Solution for Retail Sets You Up for Success

If you want to achieve success as a retailer in this day and age, it’s time to fully embrace the reality that you’re in the experience business. Transactions are no longer a simple exchange of money for goods or services; consumers demand more. They expect you to win their affection and loyalty by delivering their purchases when they want them, where they want them.

Because of this, the parcel delivery experience is more important than ever. And to thrive and grow in the experience economy, more and more successful retailers turn to a cloud-based multi-carrier parcel shipping solution.

A Cloud Multi-Carrier Parcel Shipping Solution for Retail Sets You Up for Success

Retailers such as Belk, Foot Locker, and Home Depot all use our cloud software for parcel shipping, Logistyx TME, to:

This enables their global teams to reduce transportation spend, improve on-time delivery rates, fuel agility in their shipping workflows, and gain a competitive edge in their markets.

Here’s a closer look at some of the ways our cloud multi-carrier parcel shipping software can set you up for success in the experience economy.

Expand your Transportation Network

A multi-carrier parcel shipping solution allows a retailer to easily deploy a multi-carrier strategy, which means the retailer then has more delivery options to please customers. Logistyx TME, for example, includes multiple global, regional, domestic, and international carriers in our carrier library, allowing retailers to easily build a unique transportation network to serve their customers. Then, our system rate shops across this network, switching between carriers to continually optimize each shipment to achieve on time delivery at the lowest cost based on point of origin, point of destination, delivery timeframe, parcel weight, parcel dimension, and any applicable business rules.

And though each carrier has unique requirements for labeling and electronic communications compliance, Logistyx TME simplifies the complexity of this compliance. The system ensures each shipment, regardless of whether it is shipping domestically or internationally or contains hazardous goods, adheres to all carriers’ requirements, including accounting for import tariffs, packaging specifications, and customs rules and regulations – helping retailers avoid additional fees and delivery delays.

States the IT director of one Logistyx customer, “Logistyx gave us the flexibility to add new UPS services and bring FedEx into the fold. With multicarrier options, including Mail Innovations and SmartPost, we’re saving money and providing customers better delivery options.”

Improve the Customer Experience

A retailer is, in a sense, the whole of the experiences it delivers to its customers. And since these experiences are now largely taking place online, retailers have to create memorable customer experiences without traditional in-store tactics such as music, aromatic displays, and sample stations.  The answer: flawless, personalized shipping execution. Free or discounted shipping, on-time delivery, and proactive delivery event communication can go a long way toward winning customer loyalty.

Retailers can start by satisfying their customers’ needs for instant gratification. Shipping behemoths such as Amazon have made two-day product delivery the industry standard, and to keep pace, it’s critical for retailers to decrease lead times by fulfilling orders quickly and working with reliable carriers to maintain on time delivery rates. It’s important to note here that regional carriers can be the key to faster, cheaper, and more flexible delivery services, usually offering next-day ground delivery within 400 miles of a shipment’s origin – often at a lower rate and with fewer surcharges than the national carriers. Logistyx TME includes these carriers in its carrier library and can help retailers quickly connect to their services to create efficiencies in the last mile and improve on-time delivery rates.

Next, satisfy consumers’ demands for a personalized shopping experience. Modern day buyers want more than just easy product selection and ultra-fast or same-day delivery; they also want to choose when, where, and how they receive their order. By allowing customers to pick the delivery timeframe, location (doorstep, curbside pick-up, BOPIS, etc.) and rate, retailers can give their customers additional flexibility. To this end, Logistyx TME helps retailers better serve customers by not only expanding their carrier service options, but also by seamlessly integrating with supply chain technology stacks to provide retailers with the necessary agility to manage shifts in consumer shopping patterns, such as cost-effectively moving in-store inventory and shifting more e-commerce delivery origins from distribution centers to stores.

Beware: offering Amazon-like delivery speeds and flexible delivery options may still not be enough to win those repeat purchases. Delivery accuracy is also crucial. A recent study from BigCommerce states that if an order is delivered incorrectly, late, or not at all, 29% of end customers won’t order again from the same retailer. And the lost sales opportunities don’t stop there. Consumers today share their negative experiences with the world on various social media channels and review sites, which means a bad experience with parcel delivery can quickly lead to the further loss of potential customers. Not surprising, customers want to be confident their product will arrive at its destination on time, and they are now demanding real-time delivery tracking.

While Logistyx TME provides this tracking, we also recommend our customers go one step further and use the Logistyx Control Tower to receive real-time alerts when unwanted delivery events occur, giving retailers the opportunity to troubleshoot. For example, perhaps the product can be sent from a different distribution center to arrive on time. Or perhaps the customer is willing to retrieve the product from a nearby store or locker. Providing updates when there has been a delivery disruption reassures customers everything possible is being done to meet the original delivery promise and ultimately demonstrates to customers their business is valued.

Beat the Competition

As discussed, a multi-carrier parcel shipping solution for retail fuels shipping workflow efficiency and improves the customer experience, which ultimately gives retailers a competitive edge. But the right solution for parcel shipping will also have other capabilities that can help beat the competition.

For starters, it will enable better decision-making with crystal-clear Business Intelligence and data analytics. So, rather than putting time and money toward shipping strategies that may decrease transportation spend and improve on-time delivery rates, retailers can invest in strategies that they know will work. With Logistyx TME’s Business Intelligence, for example, retailers can run transportation simulations to identify where significant savings opportunities exist, challenging the norm and comparing “what if” to current performance. They have a “sandbox” to approach transportation scenarios with a creative mindset and verify and measure the impact of various scenarios on the bottom line.

Logistyx TME customers also use our Business Intelligence technology to identify carrier delivery performance improvements and cost saving opportunities. This may come in the form of identifying and adjusting improperly invoiced items relating to contractual rates, accessories, guaranteed service rebates, claims management, address correction validations, or even manifested but not shipped transactions, or it may come in the form of modeling and comparing selected carrier services against actual carrier performance to find routing alternatives with lower cost implications and/or faster delivery times.

Achieve Success with your Multi-Carrier Parcel Shipping Solution

Retailers are faced with the same overwhelming challenge: to create a memorable and consistent experience across an increasingly complicated map of fulfillment touchpoints. But don’t worry, it’s not an impossible feat.

For example, Belk wanted to execute store-level shipping to better serve customers and stand out from other regional department stores. To achieve this, they integrated Logistyx with Manhattan Associates’ order management software to provide their stores with inventory visibility and instant access to carriers and services offering the best rates for each particular location.  Ken Fleming, President, Logistyx Technologies explains, “While simple in theory, executing store-level shipping presents considerable challenges for some retailers, including limited carrier selection and complex rate shopping. Our software is able to address these issues, providing retailers with the ability to move inventory from all locations whether in distribution centers, warehouses, or stores and optimize delivery cost and efficiency to improve the customer experience.”

You can get an inside look at the same tool Belk uses to achieve this success. Sign up for a demo today and see what it’s like to simplify the complexity of high volume, omnichannel parcel shipping.

Make these 4 Shifts to Transform Parcel Shipping

2021 is the year of the comeback. According to the National Retail Federation, retail sales are expected to grow this year between 6.5% and 8.2%, amounting to more than $4.33 trillion in sales. And with Q1 2021 on the books, retailers are now preparing for their peak season(s) by fine-tuning their rebound strategies, shifting their technology to embrace transformation and avoid last year’s challenges. Four key priorities to transform parcel shipping include:

1. Adopting a Cloud First Mindset

In 2018, Gartner predicted more than $1.3 trillion in IT spending would be affected by the shift to the cloud by 2022, a prediction that is now proving true across the Logistyx customer base. Retailers are quickly discovering how cloud-based solutions offer a clearer view into all areas of the supply chain, increasing access to data to make better business decisions and seamlessly connecting people, processes, and third parties to operations in real time.  As a result, they’re prioritizing cloud adoption and migration projects with a fair amount of urgency.

Cloud-based shipping technology enhances the speed, accuracy, and flexibility of supply chains, empowering all users to execute, track, and analyze parcel shipping processes in a single solution. This improves reaction time, collaboration, and decision-making accuracy when the unexpected occurs, whether with a single customer order or because an event impacts the entire supply chain. During the COVID-19 outbreak, for example, retailers with cloud shipping systems had the necessary visibility and agility to move inventory and convert temporarily-shuttered retail stores into distribution centers, keeping staff employed and meeting a ballooning demand to ship goods and sell store inventory.

Cloud systems also offer a much lower total cost of ownership, are simpler to implement, provide more robust data security than most retailers can themselves, and require no ongoing internal IT support. Many retailers have approached Logistyx for cloud multi-carrier shipping systems because, “We want the benefits of multi-carrier shipping technology, but we don’t want to be in the IT business.”

2. Integrating Cloud Technology and Building a Supply Chain Ecosystem

When the shipping execution process is seamlessly integrated with the total fulfillment workflow in the cloud, new automation opportunities appear that bear substantial cost savings.  Therefore, many retailers have identified seamless integration between a cloud multi-carrier shipping system and systems such as e-commerce, WMS, OMS, and ERP as a crux capability.

For example, with an integrated supply chain technology stack, retailers reduce fulfillment costs by reducing the number of times a product is manually handled throughout the fulfillment process.  The final pack, inspection, weigh, and release are accomplished with only one bar code scan.  And an integrated supply chain technology stack means shipments can be executed throughout an enterprise regardless of multiple shipping origins and/or multiple modes of transportation.  With a single database and single-user interface, the system enables rating and routing rules to be set for all locations.

Finally, once a cloud-based supply chain technology ecosystem is in place, retailers can increase the speed of information flows within the organization, making it easy to set and measure corporate KPIs, compare and contrast historical information of multiple-mode shipping transactions occurring across multi-location shipping origins, and identify efficiencies and opportunities to optimize order fulfillment.

3. Normalizing Agility

In 2020, some retailers were able to demonstrate their ability to respond to a crisis with impressive agility. Now, more retailers are looking to make agility a permanent state of mind, whether in transportation planning or in execution, and they are turning to cloud multi-carrier shipping systems to give leaders quick and easy access to the data they need to continuously adapt, prioritize, and realign. A cloud multi-carrier shipping system is the connective tissue between inventory locations, carriers, and enterprise systems, linking and presenting data and insights from disparate systems to key decision makers at the right time. A centralized platform becomes the source of truth for all order fulfillment information and the fuel for data-driven decisions—the basis of making agility not just a crisis response, but a steady state.

4. Partnering with Vendors to Achieve Transformation

Partnering with the right technology providers underpins transformation success. Retailers are looking to Identify technology providers that are forward-thinking, with product roadmaps that reflect a  visionary mindset. They want partners who are willing to have conversations about what their organizations are really trying to achieve and the technology they need to get there. The right partner can offer long-term strategies and solutions for:

  • Meeting changing customer expectations
  • Quickly responding to new product and service requirements
  • Leaning on extended, multi-tier partner and carrier networks that offer more flexibility and savings
  • Identifying inefficiencies and areas of opportunity through complete shipping operations visibility
  • Creating an agile logistics infrastructure that withstands complex supply chain issues
  • Using data analytics to support strategies, innovation, and growth

Find the Right Partner to Transform Your Parcel Shipping

For retailers worldwide, now is the time to solve problems and execute transformation. The journey requires the right mindset and the right technology. Get started today with our Quick Guide: Critical Capabilities of a TMS for Parcel Shipping.

 

4 Strategies to Create Shipping Offers that Make Customers Happy

Based on Baymard Institute’s 2019 research, the average e-commerce cart abandonment rate is approximately 70 percent, and one of the key drivers behind cart abandonment is the “sticker shock” that occurs when extra charges associated with shipping are presented at checkout. A December 2020 survey by RetailMeNot reinforces these findings, reporting 82 percent of survey respondents prefer free shipping to paying a fee to have their shipments expedited, and 70 percent prefer a lower price than waiting longer to receive their order.

Though Amazon has clearly normalized free same-day and next-day delivery, e-commerce retailers are often unable to absorb shipping costs, which typically account for up to 5% of the total cost, without significantly sacrificing their margins. RetailMeNot’s research also found that 63% of merchants have trouble matching or beating shipping deals offered by their rivals.

Minimize Parcel Shipping Costs

The key to offering free shipping is to find the sweet spot between costs and increased sales. How? Many companies are embracing free or expedited shipping to gain a competitive advantage, but also using the following four strategies to increase the profit per item shipped:

1. Implement Cloud Parcel Shipping Software

With consumer expectations mounting, many retailers turn to cloud parcel shipping software to keep shipping costs palatable while improving delivery speeds. Long used by retailers such as Belk and Men’s Wearhouse, cloud parcel shipping software can yield a number of benefits for companies hoping to compete by enabling them to automatically compare carrier rates, print carrier compliant shipping labels and documentation, track delivery, and simplify the complexity of returns.

2. Find the Pricing Model that Works Best

Retailers should be sure to choose the right pricing model. While any merchant can benefit from Cost of Distribution (CoD) reductions, cost savings will vary depending on the answer to one question: does my CoD represent a significant portion of my net landed cost of goods? In general, free shipping offers are better suited to high-margin items and/or low-shipping-cost items. Possible strategies to balance costs with profits include:

  • Requiring a minimum purchase to qualify for free shipping
  • Offering flat rate shipping for commodity items of a similar size and shape
  • Integrating cloud parcel shipping software with e-commerce technology to present real-time shipping quotes to customers for oversized or heavy orders

3. Leverage Less than Truckload (LTL) Rates for Bulk and Oversized Shipments

For buyers with large orders and longer delivery windows, retailers can save upwards of 50 percent by choosing to ship using LTL services instead of parcel.

4. Consider Hybrid Mail Shipping

When delivery speed isn’t a priority, hybrid mail services such as UPS SurePost and FedEx SmartPost can cost substantially less than standard UPS and FedEx services, assuming package dimensions and size requirements are met.  In hybrid mail shipping, packages originate with UPS or FedEx, but go to a United States Postal Service (USPS) sorting facility for final mile delivery. It’s important to note: hybrid mail shipping often leads to delays and parcel tracking may be unavailable, which means merchants who offer this carrier service for customer orders must position the option clearly as a niche choice for those who don’t care when their order arrives. Some merchants retain this as a delivery option primarily to give customers an alternative to premium charges for faster, traceable deliveries. In this context, merchants give a sense of control to customers, who decide if they want to spend extra to receive it faster.

Logistyx Can Help

Logistyx helps e-commerce and omnichannel retailers keep customers happy and costs in line. To learn more about how Logistyx streamlines and simplifies parcel shipping, download this Insider Q&A with our President, Ken Fleming.

From Rate Shopping to Returns: How Multi-Carrier Parcel Shipping Software Decreases Transportation Spend

With surging e-commerce volumes and under increasing pressure to pivot to an omnichannel distribution strategy that includes ship-from-store, ship-to-store, courier delivery, and more, supply chain leaders have a full plate these days. Yet despite all the changes that have taken place within supply chains of late, one of supply chain leaders’ biggest priorities remains: managing transportation costs. The good news is that technology, and in particular a Multi-Carrier Parcel Shipping System, has given supply chain leaders the capabilities they need to not only infuse order fulfillment strategies with some much-needed agility, but also to better control transportation spend.

How?

Leveraging Multi-Carrier Rate Shopping

A TMS for parcel shipping allows a shipper to deploy a multi-carrier strategy. The shipper can contract with multiple global, regional, domestic, and international carriers to build a transportation network.  Then, the system rate shops across this network, switching between carriers to continually optimize each shipment to achieve the lowest cost delivery based on point of origin, point of destination, delivery timeframe, parcel weight, parcel dimension, and any applicable business rules.

Negotiating Carrier Contracts

With a multi-carrier transportation network in place, shippers are better prepared to negotiate with their carriers. Because the shipper always has access to the best carrier rates for any given shipment, carriers have to work harder to earn the shipper’s business and are therefore incentivized to offer better rates.

Consolidating Parcels

Shippers can augment cost savings by using a multi-carrier parcel shipping solution to consolidate shipments heading to the same region or country and leveraging LTL rates rather than parcel rates. Referred to as “zone skipping” or “zone jumping,” companies can save as much as 30-50%. In addition to the cost savings, shippers distributing products internationally also benefit from fewer regulatory headaches, since a consolidated shipment requires only one customs declaration.

Managing Returns

Shippers engaged in e-commerce know consumers return online purchases at much higher rates than in-store purchases. And high returns volumes can be challenging, especially for shippers using a single carrier. It’s important to remember that just because a carrier’s core strength is outbound shipping does not mean its reverse logistics are equally strong, nor does it imply the carrier offers the most cost-effective rates. To secure the best rates for both outbound and reverse shipping, it is recommended shippers deploy a multi-carrier strategy, and the number of carriers in the network may grow significantly for shippers executing outbound and inbound shipping to multiple locations internationally.

In addition to managing multiple carriers, it’s important to note that multi-carrier parcel shipping software also enables shippers to use data analytics and Business Intelligence to optimize inbound distribution strategies, making sure products are returned as quickly as possible to the right distribution center, warehouse, or store to achieve a quick turnaround time for resale.

Maintaining Carrier Compliance

Each carrier has unique requirements for labeling and electronic communications, which they must strictly enforce in order to successfully process high volumes of parcels.  Remaining compliant with multiple carriers’ requirements can be complicated, particularly for shippers shipping from numerous distribution centers, warehouses, and/or stores. However, a multi-carrier parcel shipping solution ensures each shipment, regardless of whether it is shipping domestically or internationally, is compliant with the designated carrier’s requirements, including accounting for import tariffs, packaging specifications, and customs rules and regulations – helping shippers avoid additional fees and delivery delays.

Improving Customer Service

Some shippers, particularly those shipping B2B, may have to adhere to their customers’ requirements for carrier selection. For example, a B2B customer may ask their supplier to ship parcels on their account. Shippers that only use a single carrier will be unable to accommodate this request, but shippers with a multi-carrier shipping strategy and a multi-carrier parcel shipping solution can easily meet this need.

In addition, multi-carrier parcel shipping software empowers shippers to proactively address errors to maintain customer loyalty. It stands to reason that in a high-volume shipping environment, there’s a higher potential for mistakes. This is bad news in a competitive retail environment in particular, where the smallest slip in service can lose a customer forever. Parcel shipping solutions, however, can change this equation. With a multi-carrier parcel shipping solution that includes a Control Tower, shippers can automatically identify errors such as a shipment delay and respond to the error. Customer Service teams are armed with alerts and information to proactively communicate with a customer regarding their shipment status, reinforcing brand value, protecting the customer relationship, and earning those repeat purchase dollars.

Reduce Transportation Spend With The Right Multi-Carrier Parcel Shipping Software

2020 reinforced for everyone how wide-spread the implications of an unexpected supply chain disruption can be. Savvy supply chain leaders will use their takeaways from 2020 to create more flexible and cost-resilient parcel shipping operations by partnering with a sophisticated parcel TMS provider. To learn more about how Logistyx reduces transportation spend for some of the world’s biggest manufacturers, retailers, and 3PLs, watch our expert video: The Logistyx Shipping Quadrant.

3 Ways to Maximize the Power of your Multi-Carrier Parcel Shipping Solution with Business Intelligence

A Multi-Carrier Parcel Shipping System with Business Intelligence provides shippers with an easy way to aggregate and report transportation data.

According to an American Shipper report, 53% of companies aren’t using Business Intelligence to collect and analyze their supply chain data. This poor adoption rate implies companies are still performing manual data analyses (translation: excel spreadsheets). And there’s no way companies using excel spread sheets have quick reaction times when their shipping landscape changes. What they do have: delayed reactions to shipping events and hence an over-abundance of risk in the form of shipping cost increases and delivery delays.

A Multi-Carrier Parcel Shipping System with Business Intelligence provides shippers with an easy way to aggregate and report transportation data; however, companies can miss savings opportunities if they don’t put enough thought into how they want to use this shipping data once they have it. Optimizing a multi-carrier system with Business Intelligence technology requires companies to thoughtfully define how they will apply the technology and how they will set benchmarks and measure against them. These three tips can help:

1. Think ahead.

A common question our prospects ask is, “How much can a multi-carrier parcel shipping system with Business Intelligence save?” We always respond with a range (i.e., 10% – 30%). One of the reasons for providing a range is the degree of change the shipper is willing to consider with regard to its transportation optimization strategies. For example, if for some reason a shipper cannot add another carrier to its transportation mix, then the shipper is working within a fixed set of variables, and savings might be on the low end of the range. In contrast, the high end of the range occurs when shippers have the flexibility to look at the existing transportation landscape and question what could be done differently, such as adding a new carrier or even a new distribution center. For those willing, Business Intelligence is an opportunity to reexamine distribution strategies and consider all possibilities, asking the question, “What if?”

2. Define KPIs.

Without KPIs, transportation management becomes subjective. For example, it’s not uncommon for supply chain leaders to tell us they’re worried about how carrier rate increases could “shake out.” What does “shake out” mean? If the shipper has reduced parcel shipping costs by 8% and increased on-time delivery rates, then it is likely meeting objectives despite the carrier rate increases. If the opposite is true, however, the shipper will have to roll up its sleeves, identify alternatives such as expanding the transportation network beyond familiar carriers, and use Business Intelligence to run simulations to identify optimal strategies.  Shippers that set a KPI up front will be amazed by how quickly they can prove the ROI on a TMS for parcel shipping with Business Intelligence.

3. Run simulations.

There are usually myriad opinions within an organization’s supply chain team when it comes to reducing transportation costs, and one way to transition from opinion to fact is to use Business Intelligence to demonstrate the value of different shipping scenarios. Running transportation simulations can identify where significant savings opportunities exist, challenging the norm and comparing “what if” to current performance. Shippers have a “sandbox” to approach transportation scenarios with a creative mindset and verify and measure the impact of various scenarios on the bottom line.

Get the Most out of your Multi-Carrier Parcel Shipping System with Business Intelligence

A multi-carrier parcel shipping system with Business Intelligence can unveil opportunities to increase throughput, decrease transportation spend, and improve customer service. However, it’s only as effective as the deployment strategy behind it.

Are you optimizing your supply chain software investments? Contact us today for a free shipping data analysis.

 

7 Benefits of Integrating your Multi-Carrier Parcel Solution with your Business Systems

At Logistyx, we continuously deepen our ties with complementary solution partners to deliver the flexibility, security, and speed our customers need to accelerate their success. We know from experience that when the shipping execution process is seamlessly integrated with the total fulfillment workflow, new automation opportunities appear that bear substantial cost savings to the shipping function. Here are 7 benefits of integrating your multi-carrier parcel solution with your business systems:

1. Reduce Handling Costs

Shippers reduce fulfillment costs by reducing the number of times a product is manually handled throughout the fulfillment process.  By integrating a multi-carrier parcel solution with other supply chain systems, the final pack, inspection, weigh, and release are accomplished with only one bar code scan.

2. Centralize All Shipping Functions

A multi-carrier parcel system will execute shipments throughout an enterprise regardless of multiple shipping origins and/or multiple modes of transportation.  With a single database and single-user interface, the system enables rating and routing rules to be set for all locations.  In addition, shippers gain efficiencies through managing all transactions in one system.

3. Improve Automation by Using Business Rules

Most shipping systems today have the ability to “filter” requests through business rules of some kind, whether it be a 4GL or an open language like Java.  These rules can be turned on or off with a single click, thus giving the shipper more control over the automated shipping methods for controlling process flow or customer transit preferences – ultimately reducing the cost of the transaction.

4. Instill Multiple Location Control

Even though enterprise-class parcel shipping software achieves cost savings through centralization, local control must be available to each shipping origin within the enterprise.  Shipping origins affect rating, unique customer preferences, and manifest control.  The multi-carrier parcel solution will give the shipper the best of both worlds: centralized control with local personalization.

5. Integrate with Material Handling

One of the more common uses of multi-carrier in a high-volume operation is the integration with material-handling servers to automate a “print and apply” operation.  This process utilizes robotics with conveyor sorting functionality, wherein packed containers can be weighed, rated, labeled with a packing list, and automatically affixed with a carrier label.  One of the key advantages of the software in this environment is higher performance.  It is, in some cases, the determining factor between applying 10 labels per minute or 60 labels per minute.

6. Improve Transportation Planning

The particular mix of transportation modes used by the shipper will determine the overall benefit of pre-planning.  If freight loads can be identified or if parcel carriers can be selected based on lowest cost prior to fulfillment, bottlenecks and constraints can be removed at the shipping execution point of the fulfillment process.  Pre-processing of the shipment can also lend itself to printing of the shipping label with the pick ticket before the order is picked, which can replace any in-house LPN labeling, in addition to removing any label printing constraints at the end of the line.

7. Leverage Sophisticated Reporting

Now that the multi-carrier parcel software has collected all of the shipping origins, transportation modes, shipping transactions, and business rules in ONE database, through the use of simple report-writers, the enterprise shipping information can be more readily accessible for business intelligence reporting.  In most cases, this will be the first time the shipper is able to compare and contrast historical information of multiple-mode shipping transactions occurring across multi-location shipping origins.

Make Life Easier by Integrating your Multi-Carrier Parcel Solution with your Business Systems

Shippers that integrate their business systems with a multi-carrier parcel solution like Logistyx TME will rapidly realize time and money savings. To learn more about how the business system integration process with Logistyx is managed, contact one of our experts today.

 

How to Quantify the Cost Saving Benefits of a Multi-Carrier Parcel Shipping Solution

While ROI can be used as a rudimentary gauge of a technology investment’s profitability, it can be a challenge to build a business case and quantify the cost saving benefits of a Multi-Carrier Parcel Shipping Solution without familiarity or experience with the technology. The following is a summary of the benefits, both hard and soft, that would comprise the cost savings portion of a typical ROI analysis.

1. Intelligent Carrier Selection

Using a multi-carrier parcel shipping solution to automatically analyze carrier rates within the shipper’s transportation network and select the lowest-cost carrier has shown to reduce overall transportation spend from seven percent to two percent depending on the volume, mode, and service levels used by the shipper. Larger savings are found when the shipper is either shipping heavy products and using more expensive LTL or FT moves or needing to compare LTL to parcel.

2. Automated Business Rules

Multi-carrier parcel shipping software with advanced business logic can “filter” transactions through the shipper’s business rules, attaining even higher levels of automation. For example, if a shipper implements a promotion offering free shipping when the order amount is greater than fifty dollars, the parcel shipping software will execute the shipment according to this rule.  Rules can run exclusive of each other and can be turned on or off in one click.  Cost savings achieved via business rules can be high, driven by labor savings, customer personalization, or customer service.

3. Integration with the Supply Chain

In many cases, the shipping function is a standalone process at the end of the supply chain. But when shippers integrate the multi-carrier parcel shipping software with supply chain systems, shipping is now a seamless process within the business.  The multi-carrier parcel shipping solution accepts downloads of expected orders from the ERP or Order Management System and sends back key shipping transaction information for real-time status updates throughout the organization.  Product handling during fulfillment is reduced and customer service is improved.  Cost savings in this sector can be substantial when coupled with multiple modes of transportation that have traditionally been disconnected from the overall process.

4. Increased Functionality

Adding new capabilities to the existing shipping workflow will add cost saving benefits.

  • Address Validation: Correct the address to avoid carrier surcharges.
  • Shipment Consolidation: Intelligently group and rate shipments to the same or similar destinations.
  • International Shipments: Automate this complex shipping process to eliminate bottlenecks, reduce errors, meet compliance requirements, and increase efficiencies.
  • Multiple-Mode Shipments: Execute all shipments (parcel, freight, international, etc.) from the same system.
  • Multiple-Location Control: Use the same, centralized system across all shipping locations.
  • Drop Shipping: Outside vendors can use the system to ship to customers, reducing overhead and improving information regarding the shipment.

5. Improved Customer Service

Using a multi-carrier parcel shipping solution has been shown to markedly improve communication and better serve the customer. Proactive functions like email notifications and immediate track-and-trace with the carrier significantly decrease calls to customer service.  Ultimately, satisfied customers yield repeat customers and increased business.

6. Carrier Performance Review

With all shipments from all locations in one system, shippers can use Key Performance Indicators (KPIs) to track carrier performance and facilitate better carrier contracts and rates. Specific KPIs such as cost/mile/delivery can be easily calculated through basic reporting.

Reduce Transportation and Fulfillment Costs Today

With more than 1,500 collective years of experience and a strong track record of success in a broad spectrum of industries including consumer products, retail and e-commerce, technology, and manufacturing, Logistyx TME, a state-of-the-art multi-carrier parcel shipping solution, has supported mission critical supply chain execution for more than 1,000 customers worldwide.

Learn how to choose the right multi-carrier parcel shipping software for your unique shipping environment.  Download the e-book: Logistyx Quadrant: Choosing a TMS for Parcel Shipping.

3 Ways a Multi-Carrier Parcel Management System Reduces Parcel Costs

Multi-Carrier Parcel Management Systems have been implemented within the enterprise order fulfillment process for the last 25 years.  However, over the last couple of years (and especially over the last couple of months), demand for these systems from mid-size companies, e-commerce retailers, and omnichannel retailers has increased.

With the cost of transportation rising steadily over the years and in particular during the COVID-19 pandemic, leveraging a multi-carrier management system is an excellent way to reduce transportation and fulfillment costs.  Cost savings from a multi-carrier management system are realized from the moment the customer order is placed and continue through the pick, pack, and ship processes.

Typical, quantitative ROI calculations demonstrate an investment payback well within 12 months of implementing the system.  Three common factors contributing to the transportation cost savings include:

1. Carrier Costs

Rate shopping across multiple carriers within the enterprise’s transportation network is usually the most pronounced and quickest way to reduce transportation spend. At Logistyx, we have observed that moving from a single carrier to rate shopping across multiple carrier services to optimize spend for each shipment can reduce carrier costs by up to 30%.

2. Shipment Planning and Execution

The cost of the shipment will be directly related to the level of shipping automation in place. Multi-carrier software will increase efficiencies in planning, optimize carrier selection, reduce handling, automatically select transportation mode, integrate the shipping workflow into the fulfillment process, and more.  Leveraging a single system for multiple distribution locations (warehouse, distribution center, store, etc.) will also contribute to cost reductions.

3. Transportation Audit

Incorrect billing or incorrect service level charges by the carrier can amount to as much as three to five percent of total transportation spend. Did the carrier live up to the original agreement by providing the proper service at the correct cost?  The software’s audit functionality finds these mistakes and files claims to reconcile the payment process.  Additionally, audit functionality will effectively run analytics on shipping data and provide business intelligence.  Benefits include finding the true cost of carriers, deciphering trends and uncovering additional savings opportunities, and evaluating carrier performance to assist in rate negotiations.

Streamline Shipping & Integrate Capabilities to Reduce Parcel Transportation Costs

Companies not using a multi-carrier management system probably manage “transportation” functions that are distributed between systems, spreadsheets, websites, and manual (read: error-prone) processes.  By streamlining shipping and integrating capabilities, additional benefits can be realized:

1. Improved Performance

Even shipping systems purchased 10 years ago are probably using older technology, which may be slowing the shipping process just by waiting for a label to print or for a manifest to close. With higher processing speeds, wait times have been eliminated and throughput increased.

2. International Shipping Documents

Given significant increases in e-commerce, more companies are expanding their businesses into global markets. However, shipping internationally requires more documentation and greater care when doing final preparations.  A multi-carrier management system can automatically provide all of the necessary documentation by carrier, resulting in shipment error reductions.

3. Shipment Consolidations

Often, the same customer can place multiple orders within minutes of each other. Without adequate planning, companies lose the opportunity to pack those orders into the same container to save on shipping costs.  A multi-carrier management system can perform these consolidations to reduce transportation cost.

4. Address Validation and Verification

If the address printed on the label isn’t correct, the carrier will re-bill the shipper an address correction charge anywhere from four to six dollars per package. On average, 22% of an average company’s shipments are incorrect.  In addition to the address, certain carriers require a Residential Delivery Indicator (RDI) be used when shipping to a residential address.  If the shipper doesn’t include this information, the carrier will bill the shipper an additional charge.  The TMS for parcel shipping can provide address correction, usually using the USPS CASS database, to assure that the shipper won’t incur unforeseen and expensive charges.

5. Omnichannel and E-Commerce Value

E-commerce shippers are always looking for a marketing edge to keep their customers and acquire new ones. A multi-carrier management system can provide “what if” shipping scenarios to shoppers prior to their final purchase.  In most cases, the retailer using this approach will consistently present a lower shipping cost than its competitors and ultimately attract more business.

Best-in-Class Shippers Use a Multi-Carrier Parcel Management System to Reduce Parcel Costs

A multi-carrier management system enables companies to execute shipments in the most cost-effective manner possible.  To learn more about how you can decrease transportation spend with a TMS for parcel shipping, download our Quick Guide: Critical Capabilities of a TMS for Parcel Shipping.

Find the Best Multi-Carrier Parcel Management Technology

Parcel volumes are surging.  Carrier capacity is tight.  Surcharges have been announced and your transportation spend is about to take a hit.  You know it’s time to find the best multi-carrier parcel management software available, but the number of options and information can be overwhelming.  Where should you start?

Fortunately, you’ve come to the right place. We’ve compiled a list of resources to help you identify your needs, streamline your technology options, and ultimately find the “best fit” multi-carrier parcel management system for your organization.

What is the “Best Fit?”

A multi-carrier parcel management platform that works well for one organization may not work well for another. Carrier networks vary. Fulfillment scenarios differ. Customs and cross-border regulations diverge from one region to the next.  Therefore, for large enterprises tackling complex distribution scenarios and same-day/next-day delivery expectations, there is no “one size fits all” approach to parcel shipping. Instead, your goal is to find the “best fit” multi-carrier parcel management software for your organization.

ebook logistyx quadrant Choosing a TMS for Parcel ShippingTo help kick off your search for this “best fit” technology, you can watch vendor webinars or attend industry conferences (virtually!). You can also read case studies and download white papers. And of course you can talk to multi-carrier parcel management experts about the solutions they recommend.

Here are some of our specific resources to help:

  • The Logistyx QuadrantThis resource helps you assess your current shipping operations and identify both the necessary features and functionality you need in a multi-carrier parcel management system today, as well as critical tools and technology for meeting your longer-term objectives.
  • Checklist: Choose the Right TMS for Parcel Shipping: This checklist defines the essential elements of an effective multi-carrier parcel management system: a large carrier services network, an open platform, multiple integration options, control tower and real-time reporting, cloud architecture, and more. Organizations that seek to implement technology with these features meet their parcel shipping KPIs and optimize their return on investment.
  • Quick Guide: Critical Capabilities of a TMS for Parcel Shipping: This guide provides an overview of “must have” features and functionality in a multi-carrier parcel management system to streamline order fulfillment operations and achieve cost-effective, on-time delivery.
  • How to Select the Right Shipping System for your Business: Part 1, Part 2, and Part 3: This series of blog posts outlines what multi-carrier parcel management technology is and why now is the right time to make an investment. The series explains why major manufacturers, retailers, and 3PLs use this technology to scale their parcel shipping operations and power their order fulfillment strategies, and it offers tips for building a business case for a multi-carrier parcel management system within your organization.
  • Multi-Carrier Parcel Management Case Studies: To understand what you need from multi-carrier parcel management technology; it may help to read about real-life use cases. Logistyx’s customer case studies reveal real and relatable ways manufacturers, retailers, and 3PLs use multi-carrier parcel management systems to scale parcel shipping volumes, streamline parcel shipping execution, and optimize transportation spend.
  • Logistyx Research Solutions: These research pages are designed to help you discover the parcel shipping information that’s important to you. They provide useful background and insights upon which you can rely when researching your options, developing an RFP, and evaluating vendors.
  • Analyst Reviews: Industry analysts help businesses identify the best supply chain technology for their needs. Gartner, for example, provides real-time industry intelligence and makes technology recommendations and vendor introductions for their clients. Their research and consulting services can be invaluable in your multi-carrier parcel management system search.

Where does Logistyx fit?

Built for high velocity parcel shippers by industry experts, Logistyx TME is powerful, versatile technology – and the right fit is just as important to us as it is to you. We want to ensure every Logistyx TME customer is set up for success, and so we too look for “best fit.”

Here are some of the criteria we use:

  1. You need an open platform.
    A multi-carrier parcel management system with an open platform will expedite data mapping. This will give you flexibility in integrating with other systems, such as an ERP, WMS, and/or OMS.  You’ll be able to seamlessly exchange data with these business-critical systems without building custom UIs and ultimately, you’ll improve the time to value of your investment and optimize the infrastructure for your business long-term in the cloud, in the data center, and in your tech stack.
  2. (See #1 above). You are interested in integrating your multi-carrier parcel management system with other enterprise technology.
    Logistyx TME can be integrated with your existing supply chain technology stack, amplifying the ROI of your technology assets and optimizing your end-to-end order fulfillment workflows. Logistyx offers both “out-of-the-box” as well as custom integrations, allowing you to build the supply chain ecosystem that meets your needs.
  3. You want more than a platform; you want a partnership.
    Your parcel shipping needs will change over time. Consider what’s transpired in the last six months alone!  Logistyx wants to be a reliable part of your team both today and as you navigate the shipping landscape ahead. We see our client relationships as partnerships, and we are committed to our customers’ long-term success.  We pride ourselves on outstanding customer service and support, and we take the trust our customers have in our teams and in our technology seriously.
  4. You want industry expertise.
    Logistyx is oft-recognized for its innovation and industry leadership. Recent awards include the 2020 SaaS Awardin the category “Best SaaS for Shipping, Inventory or Vehicle Logistics,” the Silver StevieÒ Award in the Company of the Year – Computer Software category, the 2020 FedEx Diamond and Platinum Tier Awards, and the #1 Fulfillment Software Provider to Internet Retailer’s Top 1000 Retailers. We regularly contribute articles and thought leadership via our blog and in industry publications, and we are proud of our leadership team, which is consistently recognized for their talent and expertise.

Where do you fit?

If you have questions or would like to schedule a demo of Logistyx TME, contact a Logistyx expert today. We’re looking forward to helping you analyze your needs and determine which multi-carrier parcel management system is the best fit for you.