For many retailers, the end of summer signifies the start of
peak season. This busy period is a great opportunity for businesses to
positively impact their sales. But to do this, retailers must understand how
the peak season can affect shipping.
What is peak season?
In the shipping industry,
peak season is when import volumes rise
sharply. The demand for consumer goods rises during two periods throughout
the year.
The first is the
traditional holiday retail peak season, experienced during the second half of
the year. The second peak season bump occurs in the beginning of the year
spurred by emerging markets (read: the Chinese New Year).
A strong economy bolsters
consumer confidence, which can greatly increase freight forwarding services and
shipping demands during these two peak seasons.
Customer expectations during peak season
If a retailer is not
fully prepared with a comprehensive shipping plan to address this increased
inventory demand, delays can happen. This results in unhappy customers. And
unhappy customers can have a direct effect on a retailer’s future success.
Significant delivery delays can draw sharp
criticism. This can lead
a business to experience a dent in profit margins and its reputation.
To address and combat the
possibility of unhappy customers, deliveries
must occur in a timely manner. But this is easier said than done.
Challenges of peak season delivery
While international forwarding is never smooth sailing, the challenges get
exacerbated during peak season. At best, navigating international shipping
during peak season can be a rocky experience.
The main challenges that
retailers will experience during peak season include:
- Volatile ocean and air rates
- Rolled cargo
- Container capacity scarcity
- Trucking delays
- Increased cargo theft
This is why businesses
should not be underestimating the importance of partnering with the right international freight forwarding provider.
Their years of experience and knowledge of the international shipping industry
can make or break a business.
The fulfillment steps
below will help you navigate the tumultuous international shipping waters and
ensure your business has the most wonderful “shipping time” of the year.
1. Plan
early
The often quoted phrase, “failing to plan is planning to fail,”
is significantly relevant to businesses looking to achieve success in shipping
during peak season.
Creating a fulfillment
strategy that leads to happy customers starts with forecasting. A projection
model allows you to forecast what your
shipping requirements will be for peak season. Use tools to try to get as
detailed as possible with your forecasting.
Use historical data
trends to create a baseline. Or, if this is your first year in business, speak
to mentors or friends in the same industry. Examine inventory volume by unit
and order levels. Do the same for each sales channel your business manages.
It’s important to break
down volume by sales channel as shipping requirements can vary by channel. This
will also ensure your supply chain is ready to accommodate the increase in
inventory volume.
2. Increase
resources
To maintain delivery
guarantees when your business experiences an influx of customer orders, it’s
best to increase resources. This must be done across all fronts, from staffing
to facility space and shipping material.
While many businesses
will address labor shortages by increasing staffing, few recognize the importance of increasing equipment and shipping
material. Identifying where resources may be stretched thin will ensure that
your business is ready to accommodate additional volume.
Your international freight forwarding partner
is a great resource for managing peak season volume. They have the capacity to meet your logistics
needs without massively increasing overhead costs.
3. Consider
all your shipping options
There is no
one-size-fits-all method to successful peak season fulfillment.
Each business has different objectives and operational
requirements unique to their specific customer base. Creating sustainable
momentum during peak season requires a customized approach to shipping.
When it comes to ensuring
timely deliveries during peak season, be flexible. Certain third-party
platforms will allow your business to offer varying delivery options during peak season. This can include
anything from on-time delivery to premium same-day delivery.
If your business manages
both a brick-and-mortar retail and e-commerce channel, a multi-carrier strategy
may make considerable sense during peak season. This allows your business to
address specific channel needs while ensuring consumer goods are delivered in a
timely manner.
At the same time, if
you’re a small business focused on a single sales channel, such as e-commerce, varying shipments according to appropriate
shipping options ensure on-time deliveries.
For example,
less-than-truckload (LTL) shipping allows you to address demanding
fluctuations. This is particularly useful in handling overflow volume and
ensuring deliveries get shipped when container capacity is scarce.
4. Manage
expectations
On the customer front,
few things are as important as communication in meeting shipping deadlines
during peak season.
Customers, particularly
last-minute shoppers, must be informed
of your business’s holiday shipping deadlines well in advance. This allows
your business to set clear expectations and avoid disappointment.
Each major shipping
service will have certain cutoff dates for both international and domestic
shipments.
Likewise, you should also
inform your freight forwarding partner of any
operational changes, such as reduced holiday hours that may occur at peak
season. This fosters a more cohesive professional relationship between both
parties, resulting in better service.
5. Get
freight insurance
While every shipping
carrier is obligated to provide businesses with insurance, it’s limited at
best. During peak holiday season, when delivery volumes are at their highest,
minimum insurance coverage simply won’t cut it.
No fulfillment strategy is complete without a
comprehensive insurance plan.
As previously mentioned,
shipping during peak season is fraught with challenges. Delays, theft, and lost
inventory can negatively impact a business’s reputation, or worse, its future
growth and success.
Having insurance on your
shipped goods protects your financial interests. A comprehensive insurance plan
will reduce your company’s exposure to financial loss.
To determine the
insurance policy for your merchandise and cargo, research is crucial. This will
enable you to select the right freight
forwarder or insurance company to insure your goods. Knowing what each
insurer provides on shipments gives you more control over insuring terms.
Final tips to consider
Peak season is the most
challenging yet most important time of the year. It plays a vital role in your
company’s future success. Failure to ensure timely deliveries during peak
season can mean increased challenges in the future.
Logistic management is
essential in order to mitigate such risks. This entails order accuracy,
identifying key pain points, timely order fulfillment, and working with trusted
forwarders.
Remember, “ship happens.”
But with the right shipping management plan in place, it won’t affect your
products reaching their destinations in a timely manner.
