Holiday Strains on Shipping

Imy Clarke - On behalf of Alchemy Recruitment, January 16, 2017

December is always one of the busiest months for shipping, and with the continual rise in e-commerce, this year looks to be busier than ever. The surges of orders of Black Friday and Cyber Monday, which are now global phenomenons, as well as those last-minute Christmas gift purchases, have left some retailers unable to guarantee delivery by Christmas. 

In 2015, UPS delivered around 420 million packages in the USA alone. The resources and manpower required to undertake this gargantuan festive challenge are enormous. After the 2013 holiday season when the company found itself understaffed, UPS employed an extra 90,000 seasonal employees to help with the shipping surge. Whilst this figure is expected to increase again this year, there is some speculation that the company may struggle to find these additional employees. 

Holiday shipping is also placed under strain by an increase in cumbersome packages, or packages that require special handling. These cannot go through the typical sorting process and have to be handled manually. Whilst some companies like UPS, have approached retailers to either eliminate these packages altogether or increase charges for shipping, this doesn’t necessarily mean the process will be any more efficient - this is simply a way for shipping companies to maintain their profits.  

Improvements in the variety of shipping options available and increased opportunities for consumers to purchase more expensive, shorter-time delivery options also put strain on shippers. For the most part, shipping companies have been meeting these demands. Last year UPS’s on-time delivery percentage was around 96% and for FedEx it was 98.9%. 

One of the biggest flaws for holiday shipping is found in warehousing. Fewer than 30% of warehouses operate at maximum efficiency, with employees walking up to 11 miles per day in holiday season to gather and prepare packages for delivery. Although they can cost billions of dollars, investments into automation are worth the price for the benefits they provide. Through conveyor belts and robotics, warehouse processes can be seamless. 

Warehouses, shipping options and employees are all under the control of shipping companies. Weather, however, is not. It’s no surprise then that the biggest stresses of holiday shipping, are these forces of nature which can be difficult to predict and even more difficult to work against. In 2015, a lucky break of mild weather in the days leading up to Christmas alleviated some of the pressure from on shippers to allow a final stream of deliveries in time for Christmas. 

This year could be a different story, particularly with the already snowy and icy conditions across the UK. Shippers need to make sure that they have a variety of contingency plans in place in case the weather turns nasty. They need to know what will happen if they are faced with inclement weather, and most importantly how they will approach consumers. Will they provide refunds? Free next day delivery for a future purchase? Holiday shipping is as much a job for public relations as it is a case of logistics, and with ecommerce continuing to rise, this PR aspect is more important than ever. 

Posted in categories: Cargo, Shipping
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