Mattias Gredenhag, CTO at nShift
Retailers and warehouses must invest in muti-carrier shipping software to protect peak-season profits.
Can rethinking delivery management protect businesses from transport cost increases of 25%?
For most of the world, Black Friday is officially “last week’s news”. But for those selling to consumers it’s always Black Friday. Or at least it’s always time to prepare for it, learn from it or plan for the next one.
This year’s global shopping bonanza has certainly given retailers and warehouses much to think about. For many, the rising cost of transport logistics will be at the top of the list.
Peak-season capacity crunches could be causing carrier costs to soar by as much as 25%. Almost a third of businesses (32%) had to deal with a cost hike in 2023.[1]
While it’s still too early to assess the impact of such cost rises on this year’s Black Friday, early indicators suggest supply-chain pressures continue.
And at the same time as battling with cost pressures, brands and retailers must also work to address rising customer expectations. Research shows that 72% of customers believe that a choice of delivery options is important when shopping with a brand, vendor or retailer for the first time.[1]
Rising costs are influenced by many factors, some of which are out of a business’s control. But there are things we can do to boost transport capacity in a bid to keep standards up and costs down.
At the heart of this is access to a large carrier network. This can reduce warehouses’ exposure to cost increases, enabling them to find cost-effective alternatives more easily. While it’s too late to make the necessary infrastructure changes ahead of the rest of this year’s peak season, it’s never too early to start thinking about next year.
Here are four tips to help businesses start planning for 2025:
1. Invest in multi-carrier shipping software
When demand rises, warehouses must ensure they have capacity to meet it. This involves accessing the largest network of carriers. Not only does this allow businesses to scale up, it also enables retailers to offer a greater range of delivery options.
2. Automatically select the cheapest carrier for each delivery
The right delivery management software enables businesses to automate the carrier booking process, instantly selecting the most cost effective.
3. Display options and information clearly at checkout
Do you know which delivery options your shoppers want? Great. But can they find them quickly at checkout? If next-day delivery is no longer possible because of capacity, is this reflected at the web shop? Many consumers seek sustainable shipping and will click away if they can’t find a lower-emissions option.
4. Communicate, communicate, communicate using last-mile delivery software
If a delivery is delayed, sending a customer an email update is not enough. Communications need to go to the social and mobile apps that people use every day. And communication doesn’t have to end there. Why not weave in further product promotions or other brand messages?
Our suite of solutions combines the best aspects of delivery management with customer-facing applications. Our carrier network consists of over 1000 carriers, enabling retailers, vendors and warehouses to operate an end-to-end delivery process from checkout to returns.
[1] https://nshift.com/retail-week-shopper-unlocked
[1] https://supplychaindigital.com/logistics/black-friday-shipping-costs
Author
Author
Mattias Gredenhag
Chief Technology Officer
Mattias heads up the performance of nShift’s multipurpose software, overseeing product management and leading research & development projects. Mattias has more than 12 years of experience in the Delivery Management industry and the SaaS market, holding various senior positions in the industry for many years.
