We are well into peak season and Black Friday is just days away. In this QAD Precision Report we look at the importance of multi carrier shipping solutions to ensure timely and cost-effective deliveries.

The holiday season is officially here, and with that comes some of the busiest shopping days of the year — Black Friday and Cyber Monday. Black Friday, which falls the day after Thanksgiving, originated in the US, but it has spread around much of the world. Shoppers across Europe, Canada, Australia, South Africa and many other countries look for deep discounts and holiday deals on Black Friday.

This year Black Friday falls on 29 November, and its online equivalent, Cyber Monday, takes place on 2 December. However, it is almost impossible to separate these shopping events. First of all, Black Friday deals are offered online as well as in store. According to Adobe Analytics, Black Friday online sales spiked nearly 24 percent in 2018, with a huge $6.22 billion spent online in the US. In addition, many retailers kick off their sales before Black Friday — in fact, shoppers are increasingly making online purchases on Thanksgiving Day itself as well as in the days before. All in all, according to the National Retail Federation, US consumers spent $707.5 billion during the holiday season in 2018. Of that figure, $146.8 billion went to online and other non-store retailers.

Millions of Sales; Millions of Returns

Many retailers make the bulk of their sales during the holiday period. Even those with steady year-round sales can ill afford to miss out on holiday shopping. However, as consumers increasingly shop online, retailers must ensure that their fulfillment and delivery strategy is fit for purpose. Deloitte forecasts that online sales will grow between 14 to 18 percent compared with 2018.

To prepare for peak season, both UPS and FedEx went on hiring blitzes. In September, UPS announced plans to add 100,000 seasonal workers, while FedEx was looking to increase staff by 55,000. These hires — chiefly package handlers, drivers and driver-helpers — are necessary to help carriers manage peak season volumes. On an average day, UPS handles around 20 million packages. Jim Barber, UPS chief operating officer, predicted that during peak season, this volume would nearly double. FedEx is expecting high volumes too, and the carrier predicts that it will deliver more than 33 million packages on Cyber Monday alone.

Of course, high volumes of parcels moving between retailers and consumers are accompanied by high volumes of returns. Earlier this month, UPS forecast that returns will peak on 2 January 2020. The carrier predicts that 1.9 million returns will take place on that day alone. This would be a 26 percent increase from the peak return day in 2018. Furthermore, UPS also predicts that 1.6 million returns will take place every day in the week before Christmas Day.

The Complexities of Manual Multi Carrier Compliance 

These holiday season volumes show the importance of multi carrier solutions. Retailers that fail to deliver purchases in a timely fashion are likely to experience a higher than usual number of returns. In the early days of online shopping, volumes were substantially lower. That meant that it was preferable for a retailer to use a single carrier in order to avail of volume discounts. Many retailers still prefer to work with one carrier, as it makes managing the partnership easier. However, a single carrier strategy has its risks, including monopoly-like pricing, capacity issues, and fewer delivery options for customers.

Shippers who have agreements with multiple carriers often have separate workstations to process shipments with each one. Each carrier has its own requirements, and shippers are obliged to comply with the standards of the carriers they use. When staff need to switch between different rules it is easy for mistakes to happen. And every mistake comes with a cost— delayed deliveries, lost packages and angry customers.

In addition, it is time- and labor-intensive to manually compare rates and routes to choose the best carrier for each shipment. When you process hundreds of shipments each day, this is simply unworkable.

Equally importantly, working across separate systems means your parcel shipping data is siloed. As a result, having a clear picture of your parcel shipping spend is far more difficult.

Multi Carrier Shipping and Delivery Personalization

Whatever you sell and wherever you ship, the end goal is to deliver your products to your customers on time, in perfect condition — and ideally at the least cost to you. Any retailer that fulfills online orders needs to both manage and meet customer expectations, all while keeping an eye on the bottom line. 

Not every retailer can or should compete with Amazon Prime’s free next day delivery promise. However, by leveraging multiple carriers, retailers can give customers the one thing  we all want: choice. As more and more shopping is done online, customized shipping options have become considerably more important. Retailers therefore need tools to accommodate delivery personalization.

How Multi Carrier Shipping Solutions Can Help

GET THE BEST RATE FOR EVERY SHIPMENT

A multi carrier shipping solution with multi carrier compliance offers many benefits. By leveraging a comprehensive multi carrier solution, you will be able to seamlessly switch between carriers from a single system. As a result, you’ll get the best rate, route, service level and transit time for every delivery. 

EMPOWER DELIVERY PERSONALIZATION

There is no one-size-fits-all shipping service that will suit all of your customers. Many will prefer home delivery, certainly, but store pick-up is growing in popularity. Cost is an important factor too. The 2019 UPS Pulse of the Online Shopper found that 41 percent of respondents had abandoned a purchase because the delivery costs were higher than expected.

KEEP THE CUSTOMER INFORMED EVERY STEP OF THE WAY

Shoppers and logistics managers have something in common: they both want to know where their packages are! A robust multi carrier shipping solution will keep both customers and retailers fully informed about the status of deliveries. 

REDUCE CART ABANDONMENT WITH FLEXIBLE RETURNS

Online shoppers are three times more likely to return purchases than shoppers choosing goods in brick-and-mortar stores. Multi carrier shipping solutions can assist here too. Some carriers may be fantastic for outbound deliveries, but cannot offer the reverse logistics capabilities your company needs, or may not offer competitive rates. With multi carrier shipping solutions you can mix-and-match carrier capabilities to create a flexible returns strategy that meets the needs of customers, while also ensuring that your goods are returned at the lowest possible cost.

RELY YOUR SUPPLIER FOR MULTI CARRIER COMPLIANCE

Carriers are exacting when it comes to making shippers comply with their labeling and electronic communication standards. They have to be. If carriers were lax about enforcing these standards, it would not be possible for them to process high volumes through their networks, particularly during peak season. 

Luckily, when you a leverage multi carrier shipping solution, your provider is responsible for ensuring that you remain compliant with carrier standards and requirements. 

About QAD Precision – Trusted Global Trade and Transportation Execution

QAD Precision (Precision Software), a division of QAD Inc., provides industry-leading global trade management, transportation execution and multi carrier shipping software solutions from a single, integrated platform. Preeminent industry leaders in every region of the world rely on QAD Precision’s global support centers to leverage thousands of carriers and manage millions of shipping transactions every day. Our open architecture easily integrates with Enterprise Resource Planning, Warehouse Management Systems and legacy solutions. An ISO-certified company, QAD Precision assists companies to minimize shipping costs, optimize first mile and last mile deliveries, automate free trade agreement compliance, avoid customs delays and mitigate the risks associated with dynamic trading environments to maximize their competitive advantage. QAD Precision’s customers span multiple industries including banking and finance, life sciences, high technology, retail, industrial, automotive, higher education and public sector as well as logistics providers. For more information about QAD Precision, visit www.qadprecision.com.

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