Deciding to invest in a parcel shipping system is a big decision. If you’re running single-carrier operations and a carrier-provided workstation does the trick, that may be a cost-effective way to go. But as your organization and shipping needs evolve, you’ll likely need a more robust solution. So, how do you know when it’s time for a parcel shipping system? While the answer is different for every organization, here are a few telltale signs.
1. Your shipping costs have skyrocketed.
High transportation costs have become routine in the modern supply chain. As customers increasingly demand free and same-day/next-day shipping, supply chains must respond with faster, more dependable services – which don’t come cheap. To combat the stress on their networks, carriers are increasing rates and introducing surcharges. Rate shopping for the lowest cost carrier service therefore becomes critical, but businesses soon discover rating shipments and comparing rates using individual carrier workstations can be labor intensive.
Therefore, businesses are turning to parcel shipping software and integrating it with their Order Management Systems (OMS) to automatically import real-time order data, compare rates from their contracted network of carriers, and determine the ideal carrier service for each parcel based on point of origin, point of destination, delivery speed, cost, and any custom business rules. The software then automatically produces the carrier label and any necessary documentation, so every parcel shipped from the warehouse, distribution center, or store is in compliance with carrier requirements.
2. You don’t have the carrier capacity you need.
Given the incredible surge in e-commerce, carriers’ shipping quotas are higher than ever, and they therefore tighten capacity limits. Acquiring more carrier capacity during high-demand periods requires you to pay higher rates, usually in the form of surcharges. And if you’re shipping across borders or shipping same-day, the price increases further. Perhaps even worse, parcel shippers learned in 2021 that even the biggest carriers including FedEx, UPS, and DHL can reach capacity thresholds and turn business away altogether.
Fortunately, there are ways to circumvent these obstacles. A parcel shipping system automatically enables you to ship parcels with more than one carrier and manage capacity, regardless of whether you’re shipping globally or domestically. Good warehouse management software, integrated with multi-carrier parcel shipping software, will measure shipment volumes against carrier capacity thresholds automatically to help you optimize your shipping strategies – essentially maximizing capacity utilization to minimize transportation spend. And by understanding how much product can ship with each contracted carrier at one time, you can also communicate accurate lead times and manage shipping expectations with your customers.
3. Your shipping volumes have become unmanageable.
If you’re manually booking transport on carrier-specific workstation(s), then you’ll need more staff to handle increasing shipment volumes. However, with a multi-carrier parcel shipping system, all carriers are managed in a single platform and shipments are automatically booked with the “best fit” carrier service according to your unique business rules – reducing (and even eliminating) carrier stations on your warehouse floor and allowing you to easily scale shipment volumes without additional resources. The right multi-carrier parcel shipping system will also integrate with your existing enterprise systems (ERP, WMS, and OMS), enabling your team to fine-tune your transportation strategy based on “big picture” data.
4. Your on-time delivery rates are declining.
If your customer service team is fielding a high number of customer inquiries regarding late and/or inaccurate shipments, it’s time to evaluate a multi-carrier parcel shipping system. With a multi-carrier parcel shipping system, your customer service representatives have easy access to parcel delivery information in a single platform, which naturally improves the customer experience. Gone are the days of accessing multiple carrier websites to retrieve shipment data. Instead, your customer service representatives can quickly pull necessary information from a single dashboard, resulting in quick problem resolution and accurate customer communication. Even better: you can put your customer service team on offense. Rather than react to a customer complaint regarding a late or inaccurate shipment, with a sophisticated multi-carrier parcel shipping system that includes a Control Tower, your team can easily flag delivery “exceptions” and proactively resolve shipment errors and delays before they occur. You can even create smart exception workflows to enable automatic responses to “exception” events, reducing the need for customer service intervention altogether.
5. Your parcel delivery landscape has changed.
Let’s face it. It’s really the customer, not your friendly UPS/FedEx/USPS driver behind the wheel when it comes to parcel delivery. Your customers want their purchases when they want them and where they want them, and this may not be on their doorstep. Some may want to pick their parcels up in the store closest to their home or office, and others – especially in Europe and Asia – may prefer to pick them up from a locker. This means you need flexible order fulfillment workflows. To this end, parcel shipping software 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.
Ready to take a new approach to parcel shipping?
If these telltale signs sound familiar to you, it may be time to consider investing in a parcel shipping solution. Resources like our Quick Guide: Critical Capabilities of a Multi-Carrier Shipping Solution will give you tips to guide you through your unique parcel shipping system selection process. And if you’re interested in exploring how Logistyx’s functionality maps to your order fulfillment workflows, request a demo today to learn more!