The Logistyx Shipping Quadrant: Choosing a TMS for Parcel Shipping Learn More

Retailers: Is your Transportation Strategy Ready for Peak Season?

Peak season is always stressful for the retail industry, but the COVID-19 pandemic could create more issues than usual.  Retailers can no longer rely on their usual playbooks, with planning cycles completely upended.  For example, there is currently as much as an eight-month lead time for goods from China, and most companies haven’t placed orders, waiting to see the extent to which the pandemic will subside and economies will stabilize. And even if businesses place orders today, can suppliers fulfill these orders given the disruptions in their own supply chains?

2020 will yield a very different peak season, with retailers firing marketing engines to promote whatever goods they can get their hands on and even re-marketing unsold spring and summer merchandise as the new “it” items for fall and winter.  And will consumers even be willing to shop in-store during peak? Safety and social distancing protocols will remain for the foreseeable future, likely with limits on the number of customers allowed in a store at a given time. It’s conceivable brands will forego big in-store sales to avoid overcrowding and retailers will reduce changing room capacity to enforce social distancing. These shifts in the in-store experience, when combined with anxiety about the virus’s spread, could mean stores of all sizes will experience substantial reductions in foot traffic–and sustained surges in e-commerce orders as a result.

Retailers will have to do their utmost to attract shoppers during this peak season and provide them with a satisfactory buying experience. A key ingredient will be on-time e-commerce order fulfillment, and smart retailers will make sure e-commerce fulfillment operations are scalable and flexible enough to cost-effectively support different order fulfillment processes and satisfy the customer from product discovery to delight.

Retail Planning for Peak Season 2020

ebook logistyx quadrant Choosing a TMS for Parcel ShippingNow is the right time for retailers to review their transportation strategy and consider the lessons they’re learning during the coronavirus pandemic.  For example, is the transportation strategy flexible? Is it scalable?  Has it met the demands of this unusual environment? Or are changes necessary?

Here are six opportunities for retailers to optimize their transportation strategy to meet 2020’s peak season challenges.

1. Move from Single Carrier Shipping to Multi-Carrier Shipping

Shipping delays are something of an unwelcome holiday tradition.  A cross between fruitcake (apologies to all fans) and crowded airports (perhaps not this year).  While the end goal of any retailer is to deliver products to customers on time, without damage, at minimal cost, and in the most efficient manner possible, the recent spike in e-commerce has also increased customers’ ability to customize their shipping options, enabling them to specify when, where, and how they want their parcels delivered.

One strategy to simplify this complexity during peak season is to leverage multiple carrier services, including local and regional carriers.  This means for retailers using a single carrier for deliveries and returns, it may be time to look at a cloud multi-carrier shipping solution to quickly onboard new carriers and experiment with new delivery modes.

Cloud multi-carrier shipping software applications enable the retailer to quickly onboard new carriers and meet the customer’s shipping requirements from within the retailer’s system.  Cloud multi-carrier shipping software applications automatically determine the carrier that can provide the best rates to a particular region and according to the retailer’s business rules, ensuring every shipment is in compliance with each carrier’s labeling and communication standards, as well as with any applicable trade regulations.

Importantly, cloud multi-carrier shipping software also ensures retailers have the right mix of carrier services in their transportation strategy from the onset.  The software aggregates and normalizes shipping data across carriers, so retailers know when deliveries moving to a particular region, customer, or via a particular carrier are not meeting service levels. Retailers can hold carriers accountable for failing to meet expectations and wield hard data to back up rate negotiations, and they can consolidate carriers to ensure they get the best possible price.

2. Optimize Returns

How are returns managed? Is the returns process flexible enough to satisfy customers? How much does return shipping cost? Are protocols in place to discourage returns?

The unfortunate reality is online shoppers return up to forty percent of purchases.  But top retailers no longer accept returns as a simple cost of doing business. Instead, the world’s biggest retailers critically examine their returns processes and unlock myriad insights, including:

  • Cost reduction opportunities: Is carrier service selection for returns following the same careful processes put in place for outbound shipments?
  • Identifying weak links in fulfillment: Are the wrong products being shipped? Can these be traced to certain distribution centers, pickers, or procedural problems?
  • Determining and attaching the cost of returns to outbound shipping costs: Many e-commerce businesses expect every e-commerce delivery to be returned, and they build the cost right into their products and services.
  • Identifying which products are most returned: What can be done about this?  When the lion’s share of a brand’s returns originate from the same product or product category, difficult decisions may be warranted.
  • Assessing the impact of fraudulent returns: Luxury brands in particular need processes in place to ensure they never accept counterfeit products as legitimate returns. Even infrequent instances of fraudulent luxury product returns can wreak havoc on organizations, and every effort should be made to determine how often this happens and deter future instances.

3. Increase Visibility

How many customers are lost due to delivery delays?  And what’s the lifetime value of those customers?

A cloud multi-carrier shipping system with Control Tower functionality will sync and normalize all shipment data across carriers and delivery destinations, allowing retailers to manage by exception. Staff are alert to deliveries at risk of delay and as a result, they can proactively resolve issues and communicate with customers if and when a delivery window slips.   If a delay is unavoidable, they can inform the customer and potentially offer to compensate them by dismissing any shipping charges.

Furthermore, with detailed up-to-date visibility into the delivery journey, retailers can also offer customers the flexibility to change their original delivery instructions while the parcel is en route. A customer might be able to delay delivery or re-route the order to a new destination, for example. This flexibility can strengthen the customer relationship and build retailer loyalty.

4. Automate Freight Bill Auditing

Many carrier contracts include a form of financial compensation in case the service level agreement is not met. And yet it’s not uncommon to find discrepancies on carriers’ invoices, especially during the busy holiday season. By closely monitoring the performance of all carriers’ on-time delivery rates and making this data available in one place, a cloud multi-carrier shipping solution with a Control Tower and Business Intelligence allows retailers to easily identify invoice errors and reconcile carrier invoices to control transportation spend.

And the savings don’t stop there.  In addition to the direct cost savings carrier invoice auditing achieves, retailers also benefit from “soft cost” savings, such as the elimination of manual tasks including opening mail, sorting invoices, researching rates, auditing and approving invoices, paying carriers, and assigning a cost accounting code.  By eliminating these soft costs, accounting teams can redirect their resources to more strategic activities.

Furthermore, carrier invoice auditing provides retailers with an overview of invoiced carrier costs versus carrier agreements, enabling them to ensure their carrier procurement is aligned with strategy and verifying they’re receiving the delivery outcomes for which they’ve paid.  The right cloud multi-carrier shipping software will also model and compare selected carrier services against actual carrier performance to find routing alternatives with lower cost implications and/or faster delivery times, and even identify more advanced optimization strategies, such as effective ways to position facilities and inventory around the globe.

5. Consolidate Parcels

Shipping multiple parcels from Chicago to New Orleans? When retailers ship each parcel separately, they incur shipping costs for each. A cloud multi-carrier shipping system will enable “zone skipping” and consolidate parcels, using one carrier to move a consolidated shipment across multiple states, for example, and a local carrier, such as USPS, for the last mile delivery–reducing total shipping spend.  Furthermore, a consolidated cross-border shipment will only require one customs declaration, reducing regulatory hiccups. Final benefit: by using zone skipping, parcels no longer travel to multiple sorting facilities to reach their destination. Instead, shipments to local carriers are faster, which creates quicker deliveries for customers.

6. Improve Cross-Border Shipping

Global shipping is on the up-and-up. The 2019 UPS Pulse of the Online Shopper survey reported that while “shop local” is still trending, younger shoppers also buy goods from international sellers, looking to take advantage of price, variety, and the perceived quality of products. Retailers with a domestic-only transportation strategy will have a difficult time quickly expanding their global footprint to take advantage of this market opportunity.

Seamless cross-border shipping starts with the right label.  A cloud multi-carrier shipping solution ensures that every parcel ships with the correct label and documentation, no matter the carrier, destination, or product, making it easier for retailers to expand their global reach.

Find the Right Technology Partner for Retail Peak Season

In times like these, retailers need a partner in the logistics space on whom they can count – one who can help prepare for peak season on a compressed timeframe.  Ready to find that partner? Talk to a Logistyx expert today.

 

Multi-channel versus Omni-channel Retail: What’s the Difference?

When online shopping, customers have the luxury of placing small, frequent orders, and they can demand shipments be delivered with Amazon-like speed directly to their doorsteps, workplaces, or other convenient pickup locations. And as choice in retail continues to grow, customer loyalty is harder to secure. On-time delivery to the customer’s destination of choice can make or break an opportunity for repeat business, and retailers are increasingly dismayed to discover that one delivery delay can lead customers to purchase from another online merchant.

As merchants strive to meet customers’ exacting expectations, endlessly chasing Amazon’s same-day/next-day delivery model, many deploy either a multi-channel or omni-channel distribution strategy to optimize success.  Here we explore how the two models vary when it comes to customer experience, and how they’re vastly different when it comes to back-end operations, from warehouse fulfillment centers to shipping delivery timelines.

What is multi-channel retail?

Multi-channel retail centers around the product, placing it in places of prominence, both physical and online, to create more sales opportunities. The assumption is customers will choose the channel that best meets their needs.

The upside?  The customer has multiple channels by which to discover and purchase their product, and the retailer has many sales channels at their disposal. The downside?  In a multi-channel strategy, all channels may be available, but not all are integrated. Each sales channel is often managed as an independent silo, from order processing to fulfillment and shipping. The customer has separate purchase opportunities, but lacks a seamless purchasing and shipping experience.  For example, buying online and picking up in the store is difficult for a retailer to execute and may not be available to customers.

What is omni-channel retail?

New call-to-actionIn an omni-channel retail model, the customer experience and brand equity are front and center. The goal is to leverage various sales channels to formulate a seamless purchasing and shipping experience for the customer.  In other words, the omni-channel model accounts for the entire purchasing process, from the customer first discovering the product… to ordering the product… to receiving the product, with fluid movement between sales channels. A customer can easily order a product online and pick it up in the store… or purchase the product in the store and deliver it to their home… or order it from one store and pick it up in another. Warehousing, order, and delivery data are synchronized between each channel, providing the retailer with full transparency into inventory and into how the order moves through the retailer’s fulfillment and shipping processes.

The Impact on Order Fulfillment & Shipping

The warehouse process, while not visible to the buyer, plays a major role in the customer experience. Every shipment is a key point for customer engagement, and the fulfillment process can make or break the experience. Failure to fulfill an order accurately and/or deliver it on time where promised, and all bets are off.

Multi-channel Fulfillment

In the multi-channel model, product fulfillment and shipping are carried out separately through each channel. These siloed processes can increase time and costs; in fact, order data in one channel often doesn’t reach other sales channels, causing the retailer to miss cost-saving order consolidation and streamlined shipping opportunities.

Omni-channel Fulfillment

The omni-channel model offers a more flexible fulfillment and shipping experience for both the merchant and the customer. By leaning on a variety of order completion strategies, omni-channel fulfillment allows the retailer to choose the shipping and fulfillment option that makes the most sense for each order.  For example, the merchant can fulfill an order directly from a store… or from a distribution center… or by moving inventory from a distribution center to a store and then fulfilling the order from the store. In doing so, the merchant is better positioned to meet customer expectations for delivery timelines and accuracy.

With the right omni-channel strategy in place, retailers can establish an approach that improves customer service and profitability. Plus, by centralizing all product data in one database, the retailer can offer more flexibility, choice, and accuracy in the shopping experience.  Stock-outs are less likely to occur, and customers can receive real-time information regarding a product’s availability at a designated location.

Omni-channel Strategy is the Key to Streamlined Operations

Today, one of the keys to success for modern retailers is the ability to achieve cost-effective parcel shipping while meeting stringent delivery demands.  Without an omni-channel strategy in place, this becomes difficult and the customer experience can suffer.

It’s time to improve the experience for all of your customers by implementing an omni-channel retail and fulfillment strategy that connects sales channels, payment methods, fulfillment, and shipping.

Need assistance implementing or modernizing your retail omni-channel fulfillment strategy?  Get in touch with a Logistyx expert today.

Coronavirus Supply Chain Preparation for Retailers: Advice from Ken Fleming in Women’s Wear Daily

No matter what you ship, staying proactive to mitigate the impacts of the coronavirus on your supply chain is non-negotiable. Of course, that’s easier said than done, especially for global retailers running into capacity and mobility issues.

As a partial antidote to this spreading concern, check out this article by Women’s Wear Daily featuring in-depth perspectives from industry experts, including Logistyx President Ken Fleming, on creating a contingency plan to diminish the effects of the coronavirus outbreak on supply chains.

Ken suggests leveraging data and technology to automate processes and identify opportunities to execute optimal parcel delivery strategies, including multi-modal solutions and inventory reallocation. Keeping a flexible, informed approach is key as the virus’ impact continues to take shape.

Is your supply chain prepared to handle the global impacts of the coronavirus outbreak?

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Logistyx Improves Store Inventory and Fulfillment

Men’s Wearhouse ships from 1,800 stores and multiple distribution centers to domestic and international destinations.

Business Challenge

The drive to meet consumer demand, balance inventory and optimize fulfillment has pushed e-Commerce delivery from distribution centers to stores. While theoretically advantageous, store-level shipping presents a number of significant challenges: carrier selection is limited, services aren’t supported and rate shopping is near impossible.

Solution

Logistyx solves this problem with Logistyx Transportation Management Execution ™ (TME), a solution that provides stores with instant access to carriers and services that offer the best rates for each particular location. Seamlessly integrated with Manhattan’s Store Inventory and Fulfillment (SI&F) system, the solution supports multi-carrier rate shopping, shipment execution and label generation with accurate charge data, realtime shipment tracking and proof of delivery.

 

Logistyx TMS for Parcel Doubles Shipping Throughput

Lightbulbs.com easily transitions from six shipping stations to two, despite doubling e-commerce shipping volumes.

Service Lighting and their online superstore, LightBulbs.com, have provided lighting solutions for more than 1 million businesses and homes since 1951. When Paul McLellan, President, launched the company’s online store in 1996, he knew that technology was going to drive the growth of their company. Now, their ecommerce site brings in 80% of their business.

Business Challenge

LightBulbs.com had six shipping workstations, all with standalone, carrier-provided shipping software. The shipping process was cumbersome.

Solution

LightBulbs.com was able to go from six shipping workstations to two stations, combining the Logistyx parcel shipping software, Rice Lake iDim 3D Dimensioning systems and two Size-IT mobile dimensioning calculators.They gained tremendous efficiency. When sales doubled in their peak season, they were able to handle all of the shipping volume on the two shipping workstations without adding staff.

Online Retailer Ramps Up Holiday Shipping with Logistyx

Legendary Whitetails achieves 99% order fulfillment accuracy and reduces package costs by 10%.

Legendary Whitetails, an online retailer of affordable fashion clothing, has grown 25% to 30% year over year since 1999. During peak season, order volumes ramp up from 100 orders to 8,000 orders a day.



 

Challenge

Legendary Whitetails had completely outgrown its parcel shipping system and could not keep up with sales growth. The company selected Logistyx Technologies’ Pack-IT order fulfillment and Ship-IT multi-carrier shipping software to be integrated with its MICROS-Retail order management system.

Results

  •         Improved order fulfillment accuracy to 99.9%
  •         Increased flexibility and visibility by eliminating manual processes
  •         Reduced training time from hours to minutes
  •         Instantly strengthened negotiations with carriers
  •         Reduced per package costs by 5-10%

Contact us for a Complimentary Assessment

Schedule a complimentary transportation management consultation and demonstration today!

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Logistyx Helps McDavid Serve Up First Class Customer Service

McDavid eliminates bottlenecks in order packing/shipping lines and achieves 100% compliance with retail service requirements.

McDavid manufactures and distributes sports medicine equipment and performance wear for athletics. The company sells its products through multiple sales channels including “big box” retailers such as Sports Authority, “team” sales channel to professional, college and high school teams, a “team dealer” channel supporting trainers and trainer supply groups and via their website www.mcdavidusa.com.

Business Challenge

McDavid must efficiently manage shipping to retailers and mass merchants, including customer-specific UCC labeling, the electronic transmission of advance ship notices (ASNs) to customers, and labeling and packing its products in certain ways. The failure to comply to these complex requirements can result in significant fines. So, the company faced a serious challenge when its existing parcel shipping system vendor went out of business.

Solution

After doing its due diligence on four vendors, the company chose Logistyx and implemented its Pack-IT, Stage-IT and Ship-IT™ solutions, complete with Zebra printers and mobile computers to further streamline order packing. Not only did the Logistyx system go ‘live’ right on time, but it delivered several significant enhancements for McDavid’s order fulfillment workflow.

Results

  • Eliminated errors in order fulfillment process
  • Gained 100% compliance with retail service requirements
  • Eliminated bottlenecks in order packing/shipping lines
  • Eliminated manual processes to enhance productivity