Parcel shipping is growing at an exponential rate. The Pitney Bowes Parcel Shipping Index predicts global parcel volume is likely to more than double by 2026, driven by the quickening pace of e-commerce offerings from retailers and adoption from consumers worldwide.
And the growth rates in e-commerce don’t apply to retailers alone. Businesses too are migrating to e-commerce sales strategies. According to a 2018 study by technology and research and advisory firm Gartner Inc., 75% of all business procurement will take place via online marketplaces and sales platforms by 2023.
What’s interesting to note is that regardless of whether the purchase journey takes place in a B2C or B2B landscape, the end point is the same. In B2C, many purchasing channels work in harmony, allowing consumers to meander from product search… to investigation… to check-out… and the journey ends in fulfillment. Though the journey has different meanderings and different inventory characteristics in B2B manufacturing and wholesale distribution, it too always ends in fulfillment – which means parcel shipping, parcel tracking, and meeting “Amazon-like” shipping demands are the name of the game regardless of whether you’re a B2C or B2B shipper.
The good news is that there are a number of different parcel shipping solutions that can help retailers and businesses simplify and streamline their parcel shipping operations. The bad news is that not every solution is the right fit for every shipper’s landscape, so retailers and businesses on the hunt for new parcel shipping technology will have to do some homework.
How complex is your parcel shipping landscape?
To get started, you first need to assess the complexity of your parcel shipping landscape. While the average consumer may think parcel shipping is simply printing shipping labels, affixing those labels to boxes, and sending the boxes out the warehouse door, logistics managers know parcel shipping is significantly more complicated than this.
In order to optimize parcel shipping processes, companies must rate and rate shop each shipment to ensure they are shipping the parcel at the lowest possible cost given origin, destination, delivery timeframe, and any applicable business rules. Then, they need real-time data to track shipments and alerts to identify packages likely to miss a delivery deadline.
While it’s possible to use manual processes or carrier-provided systems to handle rating, rate shopping, and carrier selection, manual processes are time-consuming and labor-intensive. And as parcel volumes grow and marketplaces extend across borders, shipment execution can quickly become unmanageable.
In order to evaluate the complexity of your shipping landscape and choose the right parcel shipping solution for your business, ask the following six questions:
1. What is the breadth of your carrier network?
Will you need shipping options such as specialist or regional carriers? If so, you need a solution provider that can accommodate these needs. A parcel shipping solution that guarantees compliance with an extensive number of national, regional, and local carrier services can empower you to land an integrated transportation strategy worldwide – improving on-time delivery rates and saving money with each parcel journey. Think about it this way: the more carrier services you have in your network, the more choices you have to optimize your parcel delivery and transportation spend.
Are you shipping multiple orders to the same region? Are you shipping across borders? Shippers often waste time and money shipping parcels to the same place at individual rates – and they may not even be aware they’re doing it. Be sure your parcel shipping solution can identify opportunities to consolidate parcel shipments heading to the same geographic area – both domestic and international – and compare carriers and services to find the best rate. The right solution will help you optimize volume discounts and zone skipping and avoid accessorial charges – cutting your costs and increasing resource efficiency almost immediately.
3. Do you need to track delivery milestones and receive delivery alerts in the case of an unexpected event?
How do you prioritize customer service and how important is it to you that staff have the ability to take proactive measures to communicate with customers and resolve delivery delays? If the answer is “very,” then you need to have your eye on all shipments at all times. Seems impossible? With the ad hoc and real-time reporting tools available in some parcel shipping solutions, that’s precisely the level of visibility you gain. The right solution will track your parcel shipments as they move through your carriers’ global supply chains, and you’ll receive instant warning alerts if a parcel is off track or behind schedule. These alerts will enable you to proactively address delivery events such as late or damaged shipments to meet your customers’ expectations and maintain your delivery KPIs. Even better: sophisticated solutions will have a Control Tower with Business Intelligence that collects and analyzes data and generates reports across all shipment attributes including spend, geography, carriers, and clients – empowering you to continuously streamline your transportation activity, increase efficiency, improve delivery performance, and save money.
4. What are your plans for tomorrow?
You could purchase a solution that suits your needs today, but how will those needs change in three, five, or ten years? Will your parcel volumes scale? And what about expansion into new markets? Are you prepared for unexpected supply chain disruptions such as a weather event or (not another) pandemic?
When choosing a parcel shipping solution, you should not only consider your current requirements, but also strive for resilience in the face of supply chain disruptions as well as plan for future needs. This means the best parcel shipping solution will offer you flexibility and scalability.
For example, e-commerce growth rates unexpectedly accelerated in 2020 as a result of the pandemic, requiring organizations to fulfill unprecedented order volumes in a variety of distribution scenarios: ship-from-store, BOPIS, and more. As a result, shippers turned to cloud-based parcel shipping solutions to enhance the speed, scalability, connectivity, and flexibility of their supply chains. Cloud parcel shipping solutions empower fulfillment teams to execute shipments, track delivery events, and analyze parcel shipping processes in a single solution regardless of distribution scenario, while also offering them the agility to onboard more carrier services quickly – improving reaction time, collaboration, and decision-making accuracy when the unexpected occurs.
And while regulations, tariffs, and documentation, used to make cross-border shipping one of the most intimidating aspects of the supply chain, modern parcel shipping solutions also feature an integrated process for cross-border shipping, alleviating customs anxiety by automatically identifying and providing the appropriate documentation for any shipment. The solutions also allow you to analyze cross-border operations and find opportunities for consolidation, mode shifting, and cost efficiencies as your parcel moves from point A to point B around the world.
5. What are your plans for digitalization?
As stated above, forward thinking companies are moving their supply chain technology stacks to the cloud at a rapid pace. In a BCG study of more than 200 companies, digitally agile businesses achieved 1.8x higher earnings growth than digital laggards—and more than double the growth in total enterprise value. BCG also found that digitally agile companies are best situated to realize a “resiliency dividend,” by leveraging technology and digital capabilities to steer their business in real (or near-real) time to strengthen their position in the midst of a crisis.
Fortunately, cloud parcel shipping solutions enhance an organization’s digital maturity, putting operational agility within easy reach and allowing businesses to seamlessly connect people, processes, and third parties to parcel shipping operations in real time – improving reaction time, collaboration, and decision-making accuracy when the unexpected occurs. Furthermore, using a cloud parcel shipping solution enables businesses to quickly achieve a return on investment by bypassing the hit of an initial investment and reaping the benefits of rapid implementation and integration processes.
6. Do your parcel shipping operations need to integrate with other business applications?
Integration with existing systems, such as an ERP, WMS, and/or OMS, is a crux capability of any parcel shipping solution. The software should enhance and complement your other supply chain solutions, creating one ecosystem, so to speak, for the entire shipment lifecycle. This will allow you to leverage data analytics using various points of contact and empower you to ship more, faster, further, and cheaper.
The right software will have an open platform, which expedites 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 parcel shipping solution investment and optimize the infrastructure for your business long-term in the cloud, in the data center, and in your tech stack.
Choose the Right Parcel Shipping Solution
While parcel shipping solutions are critical for companies to navigate unpredictable shipping environments, choosing the right parcel shipping solution based on the complexity of your shipping landscape is the real key to success. To learn which shipping technology you need to simplify the complexity of your current – and future – shipping environment, watch this expert video.