7 Logistics Trends That Will Radically Change the Shipping Landscape in 2022 Read Now

Returns Eating into Retailer Margins after Holiday Season

According to The Wall Street Journal, extended return windows for holiday shoppers combined with rate increases from parcel carriers could cut into profit margins significantly. They estimate that between $112 billion and $114 billion in goods could be returned to U.S. retailers, up from $100 billion in 2020 and $95 billion in 2019.

Between carrier capacity constraints, rising shipping costs, and staff pay to process the returns and evaluate whether the products can be shelved and re-sold, the costs add up quickly. In fact, for some retailers, it’s less expensive to refund the money and let the customer keep the item than to take it as a return.

Logistyx has detailed the importance of having a comprehensive returns strategy in place numerous times, setting up a parcel returns resource center dedicated to the topic. Among the resources available:

While the returns trend isn’t new, it’s still an overlooked part of the sales process that retailers must consider and optimize to ensure both customer satisfaction and a healthy bottom line.

Contact us today to learn how advanced multi-carrier parcel shipping technology can help your organization optimize it’s returns process and determine which approach is best based on your business goals.

eBook - eBook Peak Season Parcel Shipping Thrival Guide

Digital Commerce 360: Online Holiday Sales Set to Maintain Gains During 2021 Peak Season

To help open the potential to grow e-commerce sales during peak, retailers will have to  find creative ways to encourage 2021 holiday sales from other parts of the world and improve e-commerce fulfillment.

While 2020 brought an unprecedented surge in digital holiday sales, Digital Commerce 360 projects U.S. consumer spending online is set to grow a more modest 12.1% year over year (YoY) this 2021 holiday season. Still, digital revenue for the pivotal November-December period is expected to surpass the $200 billion mark for the first time, reaching $215.45 billion in e-commerce sales. The digital share of total retail sales will hit 25.5%, meaning more than $1 in every $4 spent on retail purchases during the 2021 holiday season will come from online orders.

Even with e-commerce sales growth expected to slow from last year, achieving robust gains on top of last year’s historic jump is notable given shoppers’ willingness to increasingly turn to online shopping and omnichannel services to purchase goods, even across borders.

Logistyx recently commissioned a survey showing purchase influences in cross-border e-commerce on consumers’ holiday shopping behavior this year. The research reveals that 55% of online shoppers from around the world would be open to buying holiday gifts from countries other than their own.

Respondents also indicated the following factors would impact whether to buy holiday gifts from a company abroad:

  • Price of the product (71%)
  • Uniqueness of the product (69%)
  • The ability to easily track orders online (69%)
  • Estimated delivery time (69%)
  • Having an easy returns process (69%)
  • Holiday sales and promotions offered by the e-commerce site (60%)

eBook - eBook Peak Season Parcel Shipping Thrival Guide

To help open the potential to grow e-commerce sales during peak, retailers will have to  find creative ways to encourage holiday gift sales from other parts of the world and improve e-commerce fulfillment.

Developing an omnichannel distribution strategy that includes e-commerce, in-store pickup, ship from store, etc. and utilizes advanced cloud-based multi-carrier shipping systems can position retailers for success during the holidays and beyond by providing them with greater flexibility to achieve cost savings while improving customer service and fulfillment. With the right technology, retailers can better respond to peak season demand to execute various fulfillment scenarios and enhance customer satisfaction.

To learn how you can take advantage of e-commerce growth and navigate various shipping scenarios this peak season and beyond, download our Peak Season Parcel Shipping Thrival Guide.

Customer Relationships at Stake as Peak Season Approaches

Regardless of preparedness, most retailers should brace for significant challenges this peak season. Atop the explosive growth of e-commerce in 2020, experts are calling for additional growth this year. The National Retail Federation revised its annual forecast in June 2021, projecting 2021 non-store and online sales to grow another 18-23 percent to $1.09-1.13 trillion, and many retailers should expect significantly more e-commerce order volume.

Merchants and other shippers also face lingering supply chain difficulties across a wide range of industries and products, as well as widespread shipping capacity limitations imposed by carriers. Some carriers have stopped accepting new peak season business completely, including some regional carriers. OnTrac, for example, stopped accepting new peak business on September 1.

Capacity limitations, of course, only represent part of the carrier-related peak season challenges shippers must overcome. Following suit with other major carriers like FedEx and UPS, even the USPS announced peak season surcharges for 2021, and if not properly managed, the additional fees and rate increases imposed by FedEx and other carriers can prove to be even more costly.

Alternative means of fulfilling orders can take pressure off some shippers; it can also help them attract new customers who prefer to shop online but pick up at the store or require faster delivery from a local distribution point. This is particularly true for retailers who can leverage a footprint of physical stores or tap into a new breed of gig economy carriers.

Free White Paper - Simplifying Multi-Carrier Parcel Management for Peak Season and Beyond

While all these solutions have the potential to help shippers improve performance and please customers during peak season, implementing them disrupts the workflows of unprepared distribution centers and stores, especially when done so haphazardly. A failed implementation can be more costly than no implementation at all in many of these cases.

With peak season here, shippers that have yet to come to terms with these challenges should honestly assess how bad things could get and consider what options may still be available to them to mitigate some of the problems. For most shippers, this means determining the right solution and the right now solution.

The Right Now Solution

It’s too late for unprepared shippers to properly address the problem this year. Band-Aid solutions will fill the gap for partially or totally unprepared shippers. Many unprepared U.S. shippers will rely more than ever on the USPS, for example.

Those who have diversified their carrier network to at least include multiple carriers will direct parcel volume to different partners, and multi-carrier parcel shipping technology can help them do this in a strategic and cost-effective manner. Those with business intelligence at their fingertips can consider more than cost to manage the entirety of their parcel shipping needs as effectively as possible.

Previous Fulfillment Investments Now Easing the Crunch for Some

Navigating peak season is not an all-or-nothing proposition. Even partially prepared shippers will lean on their strengths to ease the crunch.

Omnichannel retailers facing major carrier-related challenges may, for example, want to determine the value of each order that can be fulfilled without the use of a national carrier. Those who determine this to be a valuable outcome can stock locally popular products in nearby stores for quicker shipments with alternate carriers. Others will provide compelling incentives to customers, encouraging them to buy online, pick-up in store (BOPIS) or accept slower shipping. All these efforts can reduce fulfillment pressure on the organization.

Omnichannel retailers like Walgreens, which implemented same-day delivery in under two hours for more than 24,000 retail products, will be tapping into gig economy carriers for additional capacity. This can help to offset need for national carrier capacity and drive more sales to existing and new customers.

Shippers of all types who have taken the time to onboard additional carriers will have multiple pools of carrier capacity available to them. For some, this might only consist of two national carriers; others may have onboarded multiple major carriers, the USPS, and regional carriers where they fit nicely. Multi-carrier parcel shipping technology not only helps shippers deploy carriers more strategically, but it can also help them prioritize efforts to secure the right carrier mix in the first place to best meet customer expectations. With the right carriers in place, this technology empowers shippers to optimize carrier deployment for on-time delivery, cost saving, performance, and more.

The Right Solution

On January 2, while navigating returns season, tear off the Band-Aid measures put in place this year as the right now solution and begin to heal your fulfillment processes. Do not make the same mistake again; start planning for peak season right away in 2022. Shippers should secure executive support for the changes that need to be made to implement the right solution and invest in fulfillment processes so they can be readier than ever for Peak 2022. Addressing the need for carrier capacity and cost containment early in the year can free teams up to focus on growing sales and pleasing customers with far fewer fulfillment worries.

Unprepared shippers have very few fulfillment options available to them for 2021 Peak at this point, but whether there’s a need for last-minute guidance and recommendations or it’s time to start getting strategic with 2022 in your sights, Logistyx can help. To learn more, watch our webinar, Embrace the Unprecedented Pace and Scale of Parcel Shipping Technology.

An Open Message from Logistyx this Peak Season

Thank you for trusting Logistyx. We are grateful for our partnership and for the opportunity to help you this peak season.

Before the pandemic, supply chain topics rarely appeared in mainstream newspapers (and certainly not on the front page). The last 18 months, however, have changed this. Exploding e-commerce order volumes, increasing carrier capacity crunches, shipping surcharges and price increases, and, of course, heightened customer expectations for rapid and inexpensive shipping have all complicated order fulfillment and logistics for shippers around the world.

Every day, we meet with companies that have no choice but to rethink their order fulfillment strategies and innovate the ways in which they deliver products to their customers to successfully compete in this new shipping landscape. There’s no doubt the definition of ‘usual’ in ‘business as usual’ has changed, perhaps permanently, and peak season is now looming as a time of great stress and uncertainty for many.

This is a moment in time when the work Logistyx does is most critical, and therefore now seems a perfect opportunity to say,

Thank you for trusting Logistyx. We are grateful for our partnership and for the opportunity to help you and your teams execute parcel shipping on a global scale. We will continue to enable you to achieve your parcel shipping KPIs by adding new features and functionality, carriers, and support to help you optimize our solution.

Our customers are at the heart of our company.. You are why we strive to be the leading cloud-based multi-carrier shipping technology provider in the world, empowering companies of all sizes to build more efficient, intelligent, connected supply chains. And while this peak season will be challenging in many ways, the current shipping environment has only strengthened our purpose and fueled our determination to enable our customers to thrive.

Our faith in our ability to deliver for you is unwavering and based on our many successes over the last year and a half, which include enabling pharmaceutical manufacturers to deliver life-saving COVID-19 vaccines to global populations and empowering pharmacy chains to enable same-day delivery in under two hours.  These use cases reinforce our technology’s potential and highlight why the work Logistyx teams do with our customers every day is a source of incredible pride.

Best-in-Class Service; Technical Reliability

Our deepest purpose as your multi-carrier shipping software provider is to enable your success with dependable technology performance. Know you will experience best-in-class service and support in the weeks ahead, as well as the necessary technical reliability. Additionally, we will work extraordinarily hard to maintain an open dialogue with you to learn from this peak season to guarantee Logistyx continues to deliver value in 2022.

Our account management and customer support teams, backed by our executive team, are here to answer your questions and address any challenges you face. We have also published a Carrier Updates and Resources page on our website to help you track changes in carrier services and shipping costs.

Cause for Optimism

We look forward to navigating this unprecedented peak season with you and helping you maximize your investment in our technology. And though the increasing complexity of global supply chain disruptions will continue to test our resilience ― we see so much cause for optimism in the years ahead and feel confident we can overcome incredible challenges. It is our profound appreciation for you—our customers, partners, and all others in the global supply chain community—that inspires everyone at Logistyx to meet you where you are and transform your parcel shipping operations to take you where you want to be.

Sincerely,

The Logistyx Team

 

 

Logistics Viewpoints: Logistyx’s Ken Fleming Discusses the ‘Right’ and ‘Right Now’ Solutions for Peak Season Prep

Logistyx President Ken Fleming discusses the ‘right’ and the ‘right now’ solutions for peak season prep in 2021.

Online shopping continues to dominate in 2021 and many retailers should expect significantly more e-commerce orders during peak season. With the carrier capacity crunch and other challenges looming, seamlessly fulfilling all those orders will be no easy task for many merchants.

On the heels of Aimee Tierney guiding under-prepared retailers on what still might be possible as they brace for Peak 2021 in a recent Total Retail article, Logistyx President Ken Fleming discusses the right strategy for shippers to navigate future peak seasons and the right now strategy to more urgently mitigate some of the challenges of the upcoming peak season in his latest column for Logistics Viewpoints. Ken shares insights on leveraging business intelligence and a merchant’s own parcel shipping strategy to light the path to this year’s short-term solutions and next year’s roadmap for strategic investment to do peak season right.

“Band-Aid solutions can still help partially prepared shippers make the best of what may be a bleak situation, and the range of options available depends largely on just how much preparation has been done,” Ken states.

“On January 2, while navigating returns season, shippers should tear off the Band-Aid measures put in place this year as the right now solution and begin to heal their fulfillment processes. They should start planning for peak season right away in 2022 to avoid entering peak season unprepared again.”

Read Ken’s full article, “Peak Season Preparations for This Year and Next,” to learn how shippers can take stock of existing capabilities to determine what’s possible for this peak season and solidify plans to implement impactful strategies to get through Peak 2021.

Holiday Headaches? Retailers Must Prepare for 2021 Peak Season Challenges

While it’s the most wonderful time of the year for many, the holiday season can be stressful for the retail industry. Soaring e-commerce growth over the last 18 months has kept retailers on their toes, especially as they scramble to prepare for the added challenges of peak season 2021.

As Digital Commerce 360 reports, “2020’s peak holiday season was a peak on top of a peak” with U.S. shoppers spending $201.32 billion online during the season, up 45.2% from $138.65 billion in 2019. Remarkably, the pace of e-commerce sales has barely let up since last holiday season; meanwhile, retailers have had to contend with additional challenges driven by the ongoing pandemic, including periodic manufacturing shutdowns, transportation backlogs, and labor shortages that have disrupted supply chains for months, as Digital Commerce 360 points out.

Once again, retailers face a heavily strained supply chain this peak season, with online purchases outpacing resources required to meet the increased demand, leading to probable shipping delays on top of the reality of limited personnel, containers, and in some cases products. Retailers will have to get creative to safeguard against rising carrier rates and reduced capacity while finding ways to improve the way they fulfill e-commerce orders.

Free White Paper - Simplifying Multi-Carrier Parcel Management for Peak Season and Beyond

To minimize shipping and fulfillment headaches heading into peak season 2021, retailers should already be preparing by implementing the right mix of shipping and omnichannel strategies, including Buy Online, Pick-up In Store (BOPIS), ship-from-store, and on-demand delivery.

Developing an omnichannel distribution strategy that includes e-commerce, in-store pickup, ship from store, etc. and utilizes advanced cloud-based multi-carrier shipping systems positions retailers for success in the face of mounting challenges by providing them with greater flexibility to achieve cost savings while improving customer service and fulfillment.

Having the right technology to execute various fulfillment scenarios will improve customer satisfaction and enable retailers to better respond to peak season demand.

Contact Logistyx today to learn how you can ensure smooth parcel shipping this peak season and beyond.

Holiday Shipping and Return Policies for Major Retailers

The holiday season is always a busy one for shopping, which means it’s a busy one for both shipping and returns as well. But this is a year unlike any other, thanks to the COVID-19 pandemic. If you ventured out for Black Friday, chances are you didn’t see nearly as many people as usual.

Smaller crowds doesn’t mean holiday shopping has gone away entirely, though. Yes, there will likely be a small drop in overall holiday shopping volume thanks to the economic downturn that has accompanied the pandemic, but the bigger takeaway is just how much holiday shopping is moving from physical to online this year.

Companies have taken note, and many are updating their holiday shipping and return policies to accommodate these changes.

Overview of Shipping and Return Policy Changes

As far as shipping goes, many retailers are offering free or reduced shipping in more generous ways than the rest of the year. Additionally, thanks to increased shipping volumes, you should be prepared for shipping times that are longer than what’s typical. Many items will still arrive quickly, but it’s something of which to be aware.

And if your purchases fail to wow? Good news: many retailers are extending the returns period for items purchased during the holiday season (roughly end of October through end of December) to spread out the in-store returns crowd. In the middle of a pandemic, brick and mortar businesses don’t want long lines of customers waiting on returns.

Of course, specifics vary from company to company. See below for shipping and return details for five top retailers.

Amazon

Amazon is the king of quick shipping, and this should continue (with some exceptions) through the holidays. Prime members can expect their usual level of service: free two-day, one-day, or even same-day shipping (for orders over $35) on most items depending on where they live. If you’re not a Prime member, shipping times and rates vary, but free standard (read: not two-day) shipping is available on many orders over $25.

All Amazon customers have the same holiday returns policy. Amazon allows returns until January 31 for anything shipped between October 1 and December 31.

One caveat with Amazon: look carefully at promised shipping times as well as sellers. Amazon hosts thousands of third-party sellers. Some play by their own rules: they don’t participate in Prime, they don’t promise speedy shipping times, and returns can work differently.

Home Depot

Home Depot might not top your mental list of holiday shopping destinations, but in reality, the hardware megaretailer does significant holiday business. This year, Home Depot isn’t making any specific changes for holiday shipping or returns. That said, their existing policy is quite generous.

Most Home Depot items can be returned for an impressive 180 days from the purchase date. Certain categories (gas-powered equipment, rugs, and furniture) have a shorter, 30-day return window.

Home Depot offers free shipping on most orders over $45 and on appliances over $396. Their most in-demand items are available with two-day delivery.

Macy’s

Many Macy’s items have a 90-day return window, with some exceptions. For the holidays this year, Macy’s has extended their holiday return window through January 31, 2021, for all holiday purchases made through December 31. If your purchase has a 90-day return window that lasts beyond January 31, the longer window remains valid.

As far as shipping, Macy’s differs from other retailers. Their website lays out an array of rates as well as a holiday shipping calendar. Orders over $99 ship free for everyone in the continental U.S. Orders under $99 cost $10.95 for standard shipping unless you’re a Platinum or Gold Macy’s Cardmember. Note: this is for standard shipping, which takes three to six days.

Faster shipping methods are available on most orders for a decent fee.

Macy’s also recommends ordering most in-stock merchandise by December 18 at the latest for arrival by December 25.

Target

Target isn’t making any specific adjustments for the holidays as far as we can find. That said, their standard shipping and returns policies are pretty great. On the shipping end, everything ships free and arrives in two days if you use your RedCard (Target’s store credit card) or if you spend at least $35.

As far as returns go, Target will take just about any item for 90 days after purchase as long as the item is unopened. Target-branded items have a much more generous policy: they can be returned for a full year from purchase date.

There are, of course, a few exceptions to this generous returns policy. One great thing about Target is that they specify these exceptions on the sales receipt.

Walmart

Walmart now offers free next-day or two-day delivery in many ZIP codes on most orders over $35, which continues through the holidays. If you don’t live in a ZIP code that qualifies for either of those categories, Walmart will still offer free standard shipping on orders over $35.

Walmart’s holiday returns policy has several layers to it. For purchases from October 16 through December 25, most items have a returns extension. Those that would have had a 14-day window may be returned through January 8. Those with a 30-day window get extended to January 24, and those with a 60-day window get pushed to February 23.

Note that third-party Marketplace sellers aren’t included in the above dates.

‘Tis the Season to Orchestrate your Parcel Shipping

If you’re a seller struggling to compete in this changing market, you need a transportation management system (TMS) to seamlessly orchestrate your parcel shipping. Logistyx can meet this need. Let’s chat today.

 

EPSNews: Logistyx President Ken Fleming Shares Insights for Avoiding Holiday Shipping Capacity Challenges

Now entering the thick of the holiday season with the pandemic resurging, the continued growth in online orders will lead to a significant increase in parcel shipping this peak season, with more packages headed to consumers’ doorsteps than ever before. Every part of the shipping chain will be stressed, with the last-mile part of the journey being stretched the most. In addition to shipping delays this holiday season, businesses must also contend with peak delivery surcharges and this peak season will add unprecedented expenses to shippers’ transportation budgets.

In a recent article for EPSNews, Logistyx Technologies President Ken Fleming discusses some of the shifts consumers and merchants are making to navigate this unique peak shopping season. He shares insights on carrier surcharges, early shopping trends, and other obstacles fulfillment teams face entering peak season 2020.

To manage the excess volumes successfully and offer cost-effective ways to meet rapidly evolving customer demands, many merchants have implemented fulfillment strategies that include a multi-carrier transportation network. By growing their carrier network, merchants can introduce more options and capacity into the parcel delivery mix and create greater flexibility and diversity in fulfillment to stay ahead of delivery capacity shortages and increasing e-commerce volumes.

Read Ken’s full article on EPSNews: “Avoiding the Strain of Shipping Capacities This Holiday Season

 

Holiday Shipping Deadlines 2020: What You Need to Know

With the 2020 holiday shipping deadlines quickly approaching, there are so many predictions this year’s peak season will see unprecedented shipping volumes, some have referred to it as “Shipaggedon.” The reasons for the doomsday forecast?

  • There’s a substantial influx of consumers shopping online for the holidays. In fact, the best guess right now is that online sales will grow in 2020 by 25% to 35%, which translates into a big increase in both domestic and international parcel shipping compared to the same time frame last year.
  • People are foregoing their usual holiday parties, which means many will mail gifts to friends and family they might normally see in person.
  • A second wave of the pandemic and new series of lockdowns has once again triggered a surge in online orders of essential goods.
2020 holiday shipping deadlines print
Click to download & print

It’s also important to note, stores are planning for lower-than-average in-store sales. It doesn’t make sense for retailers to stock inventory that won’t be sold, and they don’t want to invest in inventory that’s likely to stay on shelves for months. For the consumer, this means there will be fewer products available, and shopping early makes the most sense.

Pay Attention to the Dates

To survive Shipaggedon and make sure packages arrive on time, consumers need to know their shipping deadlines. Each carrier is expecting delays and they’re proactively letting customers know their “ship by” dates:

USPS Holiday Shipping Deadlines

The United States Postal Service has its shipping schedule posted online with helpful tips. They typically experience their busiest time of year about two weeks before Christmas. According to their website, the USPS is gearing up for a season that is projected to be busier than usual. Here are some of the dates to which you need to pay attention if you’re shipping through the USPS:

  • Ground Mail: Ground service is the most budget-friendly, but it also takes the longest. If you’re sending packages through ground service, you need to mail them earlier. December 15 is the last date to mail most packages by ground service to ensure they are delivered on time. December 6 is the last date to mail any packages to military or diplomatic post office addresses. If you’re shipping care packages to service members, make sure you send them extra early.
  • First-Class Mail: December 18 is the last date to mail first-class mail and have it delivered on time. December 11 is the last date to mail first-class or priority mail to military or diplomatic post office addresses.
  • Priority Mail: December 19 is the last day to send packages by Priority Mail.
  • Priority Express: December 23 is the last day to send packages Priority Mail Express.

Some area codes and locations may have different schedules. Check your local post office to verify what their schedule is or visit the USPS website to verify any changes to the shipping schedule as the season progresses.

FedEx Holiday Shipping Deadlines

FedEx has updated its schedule for holiday shipping on its website. You’ll notice some of the dates are earlier than in years past. You can still use the same day and priority overnight shipping options, but you can expect to pay more for these options.

  • Overnight should be mailed by December 23.
  • The same day delivery option is available on December 25.
  • For FedEx Ground and Home delivery, which are some of the most cost-effective options, you need to send your packages by December 15.
  • The FedEx Saver and 3-Day Freight packages need to be shipped by December 21.

UPS Holiday Shipping Deadlines

UPS has their shipping options available on their website, along with the dates their locations are closed. Here is an overview of your time-table to ship with UPS:

  • December 15 is the last day to send packages using UPS Ground Service.
  • December 21 is the last day to send packages using UPS3 Day Select.
  • December 22 is the last day to send packages using UPS2nd Day Air.
  • December 23 is the last day to send packages using UPS Next Day Air.

If you’re planning to send packages using the standard ground service, December 15 is the universal deadline to have everything shipped. After this date, you’ll need to use a more expensive option in order to have your packages delivered on time.

Accommodate Consumers this Peak Season – and Beyond

The escalating delivery capacity shortage and increasing e-commerce volumes continue to raise the stakes for many businesses. Companies that can invest in a multi-carrier shipping system that creates flexibility and diversity in fulfillment stand a better chance of keeping costs in check. If you’re a shipper looking to add new carrier services to your transportation network to better accommodate consumers this peak season and beyond, contact a Logistyx expert today.

 

 

Digital Commerce 360: Ken Fleming on Peak Season Fulfillment Challenges

The COVID-19 pandemic greatly impacted order fulfillment capabilities for retailers around the globe. While most finally managed to adjust systems to handle the volume spike, an unprecedented peak season raises a giant red flag. Major carriers have already alerted enterprise shippers they have limited capacity on top of announcing holiday surcharge increases.

In a recent article for Digital Commerce 360, Logistyx President Ken Fleming discusses the unique challenges:

“To reduce shipping costs, retailers need to manage flow amongst carriers via rate shopping, minimize the impact of surcharges during peak season, and choose the best-fit carrier and service for each fulfilled order. But by tying themselves to just one or two carriers, retailers have no chance to reduce costs.”

And how multi-carrier shipping technology provides a critical solution:

“Retailers looking to employ a multi-carrier shipping strategy to reduce shipping costs while also seeking to keep the process as simple as possible can turn to technology. SaaS-based multi-carrier shipping software ensures shippers can nimbly adjust to changing dynamics, whether pandemic-induced or merely the result of naturally growing sales.”

To learn how to reduce the risk of missing essential delivery windows for peak season, leaving customers unhappy and losing sales, read the full article on Digital Commerce 360: “Retailers not scaling fulfillment capacity are already behind the 8 ball

Are You Holiday Shopping Online? Plan Ahead!

Online shopping has become a mainstay of the holiday season, but this year, it’s exponentially boomed as a result of the pandemic. So what happens when an unprecedented holiday shopping rush meets pandemic demands? Some experts are predicting “Shipageddon.”

The United States Postal Service and other carriers have already experienced a huge surge in parcel shipping volumes throughout the COVID-19 outbreak. Consider all of the people ordering home goods, office, and school supplies online to maintain social distancing. As a result of the massive increase in e-commerce purchases, delivery rates for many items are currently experiencing delays, and have been for several months.

Experts are predicting online shopping for the 2020 holiday season will be as much as 35% higher than last year. Unfortunately, the shipping industry is already strained, and the increase in online purchases is outpacing resources. There simply aren’t enough personnel, containers, and in some cases products, to handle the increased demand. Examining the scenario through the basic laws of supply and demand, there is a high probability many packages will take a much longer time arriving at their destination. There may also be an increase in lost packages, and popular items may sell out much quicker than in previous years.

The Issues with Online Shopping and Shipping Gifts

Many companies are scrambling to add more resources, but you can expect there will be delays. The issues with shipping are complex:

  • Companies are overloaded with online shopping volumes due to coronavirus, and this has been an issue since March. Stores in many locations were closed for extended periods of time, making it impossible for shoppers to purchase their items in person. Many turned to online retailers in order to purchase simple necessities rather than venture to large box stores with long lines.
  • This year, the CDC has issued warnings about large holiday sales, such as Black Friday events. These are considered a high risk for spreading COVID-19. While these sales may still go forward in limited or even full capacity in many areas, a great many shoppers will avoid them. Any shoppers concerned about spreading COVID-19 and following CDC guidelines will more likely look for options to buy online.
  • Many retailers are being frugal with their inventory because they don’t want to have a huge surplus after the holiday season has ended. It’s difficult to accurately project purchases this year. With this in mind, it may not only be difficult to have your items shipped on time, it may be hard to find the products you want.

Planning Ahead for Holiday Shopping

If you’re a person who usually waits until the last minute, this tactic won’t work in 2020. It’s likely your purchases will be significantly delayed. It’s far better this year to prepare early rather than wait until the last minute.

Some tactics to help you prepare for the holiday season:

  • Place online orders well In advance. You should order any of your holiday gifts before December, if possible. A standard delivery timeframe of one week may be doubled.
  • Ship items ahead of time. For those mailing gifts to relatives in other locations, send them early. All of the major carriers as well as the USPS are experiencing a massive increase in package volumes this year.
  • Don’t wait for sales. In a traditional holiday season, retailers cut prices the week leading up to Christmas. This year, many stores won’t be offering the massive savings found at Black Friday events or the week before Christmas because they’re not increasing their inventory at the rates they previously have.
  • Don’t bargain shop for necessary items. If you have a gift or item you absolutely need to get, buy it right away. Because retailers are stocking less, it’s expected that popular items will sell out. If you wait or bargain shop, it’s more likely you won’t be able to find the item before the holidays.

What Does the Holiday Season Mean for Retailers?

This holiday season looms with a large question mark for a lot of retailers. For most retail stores, the holidays comprise a significant amount of their yearly revenue. But because in person purchasing may be diminished significantly (or entirely), it will be important to find new ways to meet your customer’s shipping needs.

New call-to-actionTo successfully execute this holiday season and keep customers coming back, many retailers have turned to cloud multi-carrier parcel management technology.  With the effective use of cloud multi-carrier shipping solutions, companies are able to efficiently ship goods worldwide at the lowest possible price and gain a competitive advantage by:

  • Maximizing the customer experience by offering fast and flexible services, increased delivery transparency, and proactive responses to their individual needs
  • Managing carriers to ensure compliance and avoid delivery delays due to incorrect labels and documentation
  • Rate shopping with contractual partners to select the best carrier service for each shipment according to customer preferences and business rules
  • Identifying and quickly on-boarding new carriers to better leverage last mile services and expand into international markets
  • Eliminating labor intensive tasks such as carrier invoice reconciliation
  • Leveraging Business Intelligence (BI) tools to uncover savings opportunities

Transform Holiday Shipping

Are you bracing for an influx of online orders this peak season? See how Logistyx’s cloud multi-carrier shipping solution can transform the parcel delivery lifecycle for your business.

What Early Holiday Shopping Means for Parcel Shipping

Regardless of whether consumers and retailers are ready, holiday shopping – and shipping – season is here! With carriers announcing capacity shortages and major headlines advertising “Shipageddon,” consumers have been encouraged to start shopping for the holidays NOW.  While this elongated holiday shopping season can certainly create new revenue opportunities for retailers, retailers can only capitalize on the opportunity if their parcel shipping operations are prepared to execute.

Nightmare on Parcel Street

Although the holidays have always been considered “peak season” for parcel shipping, this year’s unparalleled e-commerce growth has redefined and intensified that reality. Businesses relying on parcel shipping must prepare for a capacity crunch and delivery setbacks (nicknamed the “Nightmare on Parcel Street”) as FedEx and UPS capacity for the holidays is filled. ShipMatrix projects as many as seven million packages per day could be outside of maximum capacity for these two leading carriers’ parcel delivery services, and even regional and last mile carriers OnTrac, LaserShip, and Speedee Delivery have reached capacity heading into peak season.

Amazon Prime Day Kicks Off the Season

Despite Amazon moving its Prime Day event from July to October, Amazon Prime Day has remained a catalyst for competitors such as Target, Walmart, and Best Buy to launch their own offers. This year, however, these offers aren’t only available for a “limited time.” Rather than halt promotions after Amazon Prime Day and relaunch the offers closer to Thanksgiving, many retailers opted not to hit pause on their holiday sales. For example, Target is offering “Black Friday pricing all November” and Logistyx customer Home Depot is making special offers available until the end of the year.  The hope is to spread demand to prevent further strains on supply chains by encouraging consumers to shop earlier and avoid crowds and delivery delays. In addition, many carriers have encouraged retailers to run these types of sales events to increase the chances of deliveries reaching customers on time.

Holiday Purchase Trends

Extended discount periods aren’t the only changes we’ll see this holiday season. We’re also likely to witness a dramatic shift in consumer wish lists – pivoting from luxury goods to practical purchases such as home goods, office supplies, and outdoor equipment.  For example, coats and fire pits are finding their way onto many letters to Santa, as they enable friends and family to gather outside in cold temperatures while respecting social distancing guidelines.

And while electronics have always been favorites for holiday gift-giving, this year they’re even more popular. With so many people furnishing home offices and remote learning spaces, laptops, keyboards and monitors are in high demand. Unfortunately, however, internationally sourced electronics may have a difficult time meeting this increased demand due to widespread shipping delays caused by the pandemic.

Leverage Multi-Carrier Shipping Technology

Unfortunately, taking advantage of the early start to holiday shopping requires more than offers and promotions.  Facing the challenges posed by an unusual online shopping landscape, with tight carrier capacity and high shipping costs, fulfillment teams face significant obstacles entering peak season 2020. Retailers and eTailers will be on the order fulfillment end of record levels of online orders, and to manage these volumes successfully and offer cost-effective ways to meet rapidly evolving customer demands, necessary operations and fulfillment strategy implementations should already be underway.

One key ingredient to this season’s fulfillment strategy will be a multi-carrier transportation network. Growing its carrier network can help any merchant, regardless of peak season, by introducing more options and capacity into the parcel delivery mix. Therefore, retailers that want to stay ahead of delivery capacity shortages and increasing e-commerce volumes have invested in a cloud multi-carrier parcel management system that creates flexibility and diversity in fulfillment.

Though some shippers hesitate to take on additional carriers, thinking it will create more work for warehouse staff, the reality is adding new carriers to a delivery network need not be an arduous process. Some systems, such as Logistyx TME, offer an extensive carrier network that includes dozens of regional carriers – including LaserShip, OnTrac, and Speedee Delivery – making it much easier and faster to add carriers’ rates and services to a merchant’s carrier network. Additionally, TME allows shippers to embed their shipment processing rules into the system so carrier selection decisions can be as automated as desired. Many companies configure TME to select carriers and services based on their internal shipping rules as well as their customers’ shipping preferences. Once the carrier service is determined, the system automatically generates the right carrier-compliant labels. As a result, shipments routed via regional carriers are handled as quickly and efficiently as those routed via national carriers.

In addition, a sophisticated multi-carrier parcel management system will include a Control Tower, which means retailers can proactively manage against unwanted delivery events and provide shoppers with delivery transparency. Specifically, the system will send early warning signs when there are parcel delivery issues or “exception events,” empowering customer service teams to proactively trouble-shoot the exception event and communicate delivery updates to the customer in real time. 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. Customers can even track and trace shipments on company websites without the need to visit carrier sites, reducing inbound calls about shipment status to customer service and increasing the customers’ browsing behavior on the retailer’s website, which (fingers crossed!) could lead to additional purchases. Consider too that tracking delivery exception events enables retailers to capture accurate carrier performance data – improving carrier service measurement and better informing carrier contract negotiations.

The 2020 Holiday Shopping Season is Here

Now more than ever, retailers should have a parcel shipping strategy in place that delights customers and increases business. To learn more about simplifying the complexity of high velocity parcel shipping with a multi-carrier parcel management solution, contact a Logistyx expert today.