Parcel shippers need to leverage their 2021 shipping data to help evaluate order fulfillment options and improve decision-making.
We saw many changes in the supply chain landscape in 2021. Spurred by the ongoing pandemic and supply chain disruptions, trends such as pop-up distribution centers, BOPIS, and gig economy couriers took center stage to help shippers satisfy consumer preferences for “fast and free.” In this unique landscape, it was the shippers with flexible order fulfillment and logistics workflows in place that were able to quickly embrace these trends and succeed.
As we begin 2022, consumer expectations for “right now” e-commerce deliveries show no signs of stopping. This means carriers are under continued strain to meet delivery commitments and will likely maintain their threshold caps during peak times as well as levy peak surcharges. Shippers are therefore hungry for reliable data to help them evaluate their order fulfillment options and improve decision-making.
Stay Organized and Synchronized
The first step in leveraging your existing data doesn’t start with your data; it’s in the way you organize it. Because of the complexities of today’s shipping environments, most organizations use multiple software applications that execute an increasingly wide range of specialty functions. This means supply chain data may be fragmented – and therefore has limited potential. For example, how can management make strategic decisions about shipping when the logistics department works with different data than the procurement department?
Therefore, it’s best practice to integrate all systems in the cloud and designate a system of record to maintain order and keep all technologies on track. In fact, establishing a cloud-based system of record had become a top priority for many shippers even before the pandemic injected additional complexity into the supply chain.
Specifically, integrating a parcel shipping system with other business systems of record will let you aggregate your parcel shipping data across your entire distribution network, and even better: it normalizes the data. This in turn enables key stakeholders in your organization to leverage actionable reports and dashboards within the shipping system and run analyses across all your channels so you can better understand and manage order volumes, shipping costs, capacity utilization, on-time delivery performance, and more. These analytics can then be used to identify opportunities to save money, improve customer service, or both.
Apply Business Intelligence
Once your data has been realigned, it’s time to put those numbers to good use. The easiest place to start your analysis is evaluating data points (i.e., distance, speed to delivery, density, package size) from three levels of input: shipment level (what was manifested), event/visibility level (track and trace feeds), and invoicing level.
Sophisticated parcel shipping systems will include a Business Intelligence platform that understands how these data points affect spend within the transportation carrier landscape, visualize how and where changes should occur, and retain this information as a “profile” that allows you, the shipper, to negotiate with carriers. For instance, if you are implementing changes in fulfillment to increase ship-from-store or locate a new DC, understanding how these adjustments impact zone and carrier service-level downgrade options are critical.
Here are three ways in which Business Intelligence can help reduce parcel shipping costs.
1. Run Rate Scenario Analyses
With data availability and analysis, you can answer questions such as:
- What is the impact of a proposed carrier rate change on spend?
- How will on-boarding a new carrier affect transportation spend?
- How will ship-from-store or new DC placement affect spend?
With proper Business Intelligence tools, you can extrapolate the impact of various transportation scenarios across significant data sets, which enables your carrier negotiations and transportation budgets to take shape. A rate scenario analysis paints the picture and empowers you to make cost-savvy supply chain decisions that align with your business strategy.
2. Improve Reaction Time
Failures in the delivery process can be expensive to correct; customers can be lost forever. Effective delivery event management facilitates a better customer experience and aids in overall supply chain health, but there are hundreds of types of delivery status messages available from carriers, and it can be overwhelming. With a proper system to retrieve, store, interpret, and action the delivery status data, you can proactively manage your customer’s delivery experience.
State-of-the-art parcel shipping systems with Business Intelligence will normalize all the different status message data available across carriers and place them into problem categories (exceptions) that require a call to action. You should be able to visualize and assign the right resources for real-time response and speedy resolution, minimizing customer service failures and reducing overall parcel shipment costs.
3. Support Carrier Procurement
Identifying the ideal combination of carriers requires data analysis and simulation. If all carriers delivered to all regions with all services 100% on time, this would be a simpler exercise. But by using your data and Business Intelligence to understand where carriers perform well (and not), you can rapidly evaluate delivery performance and their cost impacts to identify your optimal transportation network based on factors such as service, price, capacity, and quality.
Utilize the Right Parcel Shipping Software
None of the steps above can be completed without proper parcel shipping software and Business Intelligence. Using the proper software helps you aggregate, normalize, and action your data, freeing up the time and resources it would take for you to evaluate your operations manually.
Logistyx is ready to help you build a stronger, data-driven supply chain and logistics operation, capable of withstanding supply chain disruptions. To unlock your potential, contact one of our experts today.