E-commerce delivery needs and trends are in a state of flux. This is especially true of market shifts in shipping mode access and availability, as well as the ongoing changes within surcharge schedules for all major parcel carriers. These pressures can grow and become even more challenging as peak season logistics and methods push past their limits. Add the forces of market volatility caused by the pandemic and current recovery processes, and collaboration and innovation are more critical than ever for achieving success.
Peak Season Logistics Management Is Always Subject to Consumer Demands
Staying on top of peak season demands and managing the supply chain effectively comes down to the careful monitoring of consumer trends and market fluctuations. As demands increase, logistics managers must adapt and scale their management plans to accommodate those new needs and consumer expectations. Every year, consumer needs grow and pressures increase, and as recovery from COVID-19 continues, these pressures are only expected to intensify for the foreseeable future.
The coming peak season necessitates increased scrutiny of costs to ensure product pricing aligns with actual overhead costs too, such as when free shipping is acceptable and at what service level.
Shippers that understand the market dynamics, such as delays around major import centers, are better equipped to handle customer demands. By using this data, it’s easier to accommodate those changes and added pressures.
Cost-Effective Shipping Depends on Carrier Surcharge Fluctuations Too
Capacity limitations and shortages can cause issues with standard shipping and logistics. It’s all due to limited drivers and market instability. Shipping space comes at a premium price and leads to additional surcharges and expenses for carriers. That adds up to an increased expense for shippers that needs consideration when choosing a carrier for a shipment or planning loads. Proper planning and management of peak season logistics can help offset fee and expense fluctuations. That allows for more streamlined operations during increased parcel peak and higher demands.
As an example, tracking the average weight per package can go a long way toward assessing costs charged by carriers and forecasting likely spend increases throughout peak.
Getting the Right Service Level and the Lowest Cost Aren’t Necessarily One and the Same
While it is true that customers generally want the most affordable option for their shipping needs, that does not mean free and slow options are always the best. In some cases, a fast 2-day or even overnight option is needed. So, paying for premium services in such a situation is generally something customers will agree upon. It all comes down to understanding the consumer’s needs, the special handling requirements of the order, and the available shipping options. This will become a key concept for supervisors to perfect when it comes to peak season logistics management. A great example of this is knowing your true time in transit for ground services on a zip code basis or allowing the customer to select delivery date versus choosing delivery service giving the shipper the power to select the right service for that shipment.
Multimodal Shipping Is Complex and Requires Clear, Consistent Communication to Avoid Wasted Resources
Like everything involved with supply chain logistics, managing peak season logistics often comes down to choosing the most suitable modes of shipping. As stated by SupplyChainBrain, there was already a trend of people starting to order more online instead of shopping in stores before the pandemic hit. Multimodal shipping offers a way to take advantage of multiple modes to reduce total costs.
Zone skipping and hub injection may be alternative fulfillment models for adding value and reducing costs. That depends on knowing all shipment O/D data, ensuring that data is properly cleansed, normalized, and analyzed with best-of-breed solutions to track logistics performance. Such gains amount to understanding where a shipment can be switched between modes without disrupting the customer experience.
Working With More Carriers Increases Risk, But Leveraging Data to Stay on the Same Page Can Help
At the heart of peak season planning and management is the ability to use data to gain actionable insights that improve decision-making. By utilizing data efficiently within a single source of truth, supply chain teams can collaborate and communicate when issues and disruptions arise. Knowing where loads are, what ETAs are coming up, and responding to delays effectively, including automated anomaly detection, can help improve parcel delivery efficiency. Shippers must balance the increased risk of working with more carriers by offsetting it with data-driven insights to increase productivity and success rates for on-time deliveries.
Knowing When to Leverage Zone Skipping or Go by Ground Can Help Keep Costs Under Control
Monitoring shipping options and opportunities is a critical part of peak season logistics management. Knowing when to implement different fulfillment models is key. It may be more cost-effective to ship when using zone skipping, hub injection, and load consolidation practices. Seeing those opportunities depends on capturing data, normalizing it to ensure it’s easy to understand by business intelligence algorithms, and connecting the dots within a single source of truth. Utilizing data, companies can conduct network modeling to accurately measure costs savings and customer service impacts with different shipping modes. Leveraging KPIs throughout the whole process can impact how cost-effective shippers can be as they struggle to balance increased shipping expenses with delivery in the final mile. Rather than always shipping with what’s expected, it may be well worth the time to explore other possibilities, using data along the way.
It All Adds up to Increased Complexity and the Need for a Single Source of Truth Across All Modes
Shipments will likely continue to be way more volatile even as recovery continues across much of the global supply chain network. Everything from e-commerce pressures to changes in consumer needs and demands can impact the growth and productivity of the modern supply chain network. As shipping and transportation become more complex and involved, the need for a single source of guidance and logistical management becomes apparent. Contact Intelligent Audit today to shed some light on the functions of peak season shipping logistics and management.