Peak season has always been challenging for shippers and carriers alike, but the rise of eCommerce brings an added complexity. Because eCommerce is still trending up while retailers are searching for ways to attract customers to brick and mortar locations, peak season forecasting remains fairly difficult. Luckily, industry technology is also becoming much more effective at handling large volumes of deliveries. Before automation, visibility, and API networks were in play however, carriers had to learn the hard way how to handle peak season eCommerce.
Take 2013 and 2014 as an example. UPS, one of the most innovative and successful shippers in history, ran into some unexpected issues during back to back peak seasons.
2013 - Understaffed and Hit by Bad Weather
2013 was one of the first major years for eCommerce. Last-minute orders began to flood peak season right around the same time massive snowstorms hit several regions of the US. This perfect storm, pardon the pun, resulted in roughly 2 million UPS packages failing to make their Christmas Eve delivery deadlines. This, of course, cost the company millions of dollars and left many of their customers feeling the impact of a poor experience. UPS, believing that much of the negative impact could have been mitigated by hiring more peak season staff, began planning for the next year.
2014 - Overstaffed but Prepared
Taking great care to avoid a repeat of the previous peak season, UPS went into 2014 with plans to staff up. They nearly doubled their seasonal hiring efforts and also invested around $500 million in other solutions to avoid being caught in snow storms or other unexpected events. While they were extremely successful in delivering to their customers on time, their peak season profit margins took a hit because they overcompensated with the size of their staff.
How Technology Helps Carriers Crush Peak Season
UPS found that staffing, while still an important component of peak season planning, is a delicate balance that can be offset by strategizing in other areas. Essentially, the ability to respond to unexpected occurrences like bad weather or an unexpectedly high volume of deliveries is a more efficient way to approach peak season, especially from a cost perspective. Staffing up is temporary, but it’s also very expensive. Investing in technology that increases your visibility, tracking ability, and the speed at which you can respond to exceptions is something that provides its value well beyond peak season.
In today’s logistics technology landscape, peak season is even easier to manage. Using project44’s solutions, carriers and shippers can leverage statistics to better forecast their peak season numbers, as well as more effectively manage inventory, automate time-consuming manual processes, respond to exceptions more efficiently, and achieve crucial visibility during the busiest time of the year.
And if you’re wondering, UPS knocked the 2015 peak season out of the park!