Parcel e-commerce comes with its own set of parcel carrier challenges. The e-commerce industry changes constantly, which now creates new challenges that lead business owners to seek out new processes designed to improve delivery practices for the business and the consumer. The evolution of parcel carriers is a direct response to e-commerce growth, especially in the past year with dramatic increases. And across the board, fulfillment and delivery are merging through the introduction of new parcel couriers, comparable to regionals, but these entities leverage the power of crowdsourcing.
For instance, Target uses Shipt to offer same-day delivery. HEB offers the same through Instacart. And Walmart uses a mix of DoorDash and other services to make their same-day deliveries a reality. New technology makes this expansion with parcel e-commerce possible and keeps everyone evolving and profitable. Let's take a closer look at the changing innovations pushing the industry forward and what they mean for the future.
The expanding industry for parcel e-commerce continues to boom and require renovations to those procedures to keep pace with the growing demand. Larger parcel shippers such as UPS are actively working to offset the new package volume, and direct to consumer (DTC) accounts for two-thirds of package volume, according to Logistics Management. These unprecedented numbers mean the parcel industry must evolve to keep up with the demand and continue to serve its customers using e-commerce best practices. Additionally, the rapid expansion of e-commerce over the past year, as well as the continued effects of new and existing peak surcharges are forcing shippers to re-evaluate their current parcel carrier partnerships. For example, many "gig economy" delivery providers like Ship Veho or AxleHire were started in response to the failures companies were seeing when choosing the United States Postal Service (USPS), which already operated in all residential locations, yet were unable to deliver packages effectively. These "gig economy" delivery providers saw an opportunity to displace the less reliable options that cropped up initially, like Smartpost, leading with technology to aid companies in getting matched to delivery drivers who were more reliable. This growth in parcel and package delivery options will continue to crop up in response to changing needs by the market.
Hiring more employees is nothing more than a bandaged, short-term solution, and there is currently a labor shortage with many companies struggling to find workers full-time. Parcel shipping needs more help than what major carriers can provide. One of those aids comes with new software and technology that helps shippers understand their data from a larger view and apply it to understand where to focus. The latest technology will help track inventory and streamline the process of shipping. Not only does the demand continue to grow, so do the expectations for on-time, in-full and fast delivery. Technology not only effectively boosts efficiency, but it also helps with factors like managing peak surcharges. Surcharges come when the demand is too high with a myriad of other factors, such as time of the year. Integrating technology into the vastly developing parcel e-commerce industry only helps with faster shipper and efficiency for businesses, particularly as costs increase for all shippers, including those who have massive volumes, who in the past were able to negotiate lower rates due to their size.
Parcel e-commerce continues its evolution through the infusion of more technology and efficiency based on data-driven changes. New approaches to managing parcels, such as zone skipping and crowdsourced parcel couriers, can help and are among the top e-commerce shipping best practices. However, that's not the only factor driving change. As the industry evolves, parcel shipping and the integration of new processes can greatly enhance transparency and bolster throughput. Some of these new approaches and opportunities include:
The optimal parcel e-commerce shipping strategy depends on implementing the right data platform to boost profitability. The parcel industry continues to boom, and as more gig economy workers and parcel couriers enter the workforce, it's going to take a strong focus on data to ensure everything moves accordingly. That's why having and using a world-class analytics platform will keep carriers, shippers, consumers, and business owners happy and performing better than ever. Connect with Intelligent Audit to get started today.
Set up a call with one of our experts to discuss how Intelligent Audit can help your business uncover opportunities for cost reduction and supply chain improvements through automated freight audit and recovery, business intelligence and analytics, contract optimization, and more.
Reducing transportation spend through machine learning in information technology can benefit shippers. Learn how today.