Who could forget Christmas 2013’s shipping debacle? It looks like Christmas 2014 could be worse.
Last year, howls of protest could be heard throughout the country as UPS and FedEx missed holiday delivery dates for presents ordered from a wide swath of retailers. The story made headlines and was shown on every major network’s evening news. So, with that experience under their belts, retailers and carriers insisted that it would not happen again. Uh-oh, hold that thought, because an article that appeared last week on FleetOwner.com, “Holiday sales could generate freight complications, say experts,” said the worst may be yet to come.
Consulting firm Deloitte LLC expects a moderate rise in holiday sales this year over last; however, when it comes to online and mail order channels, they are forecasting a 13.5% to 14% increase in “non-store” sales…and that’s where the trouble lies. Online buyers are used to things happening quickly; and that includes delivery of goods. When a shipper promises delivery by December 24 if you order by December 15, that better be the case.
What’s a shipper to do?
In a recent Transport Topics article, “Time to Lock in Rates,” Joe Gallick, NationaLease’s Senior Vice President of Sales, indicated that truck capacity is already running close to 100%. Now add in the increase in freight for the holidays and you’re looking at a potential nightmare. With truck capacity so tight, shippers would do themselves good by turning to a third party logistics (3PL) provider to lock in, not just rates, but vehicles and drivers as well. The important point for shippers is that they find the right carrier for the purpose. Tightened freight capacity doesn’t just potentially impact those companies with e-commerce shipments; it affects all sorts of industries and businesses that need to ramp up during the holidays. An increase in parties and holiday visits means supermarkets need to keep their shelves continuously stocked, right up to New Year’s Day.
Remember in a tighter freight market, it’s the carrier who’s in the driver’s seat. That can mean an increase in price and a decrease in availability. So smart companies have already begun investigating ways to ensure on-time delivery…and that means a much bigger dependence on 3PLs.
To keep happy holidays from turning into hapless holidays, check out our Dedicated Logistics service.