4 Tips to Handle Shipping Issues and Increased Surcharges During The 2020 Holiday SeasonOctober 19, 2020
The holiday season can be an incredibly stressful time for shoppers, businesses, and carriers alike, but 2020 has the capacity to create the most difficult one on record. Parcel shipping services are in more demand than ever due to increased rates of online shopping caused by the COVID pandemic, resulting in higher surcharges from major carriers. As early as August, FedEx, UPS, and USPS announced new surcharges that will drastically impact ecommerce shippers expecting record volume during the holidays.
Do not go into the holidays unprepared. Here we will discuss 4 tips you can follow to help with shipping issues and higher surcharges during the 2020 holiday season.
Tip #1: Do Your Research
The old saying “Failing to plan is planning to fail” holds especially true for businesses operating during the 2020 holiday season. Make sure you take the time to study the new peak surcharges and estimate the potential impact their cost will have on your shipping budget. Use a parcel analytics tool to help you see where any changes can have an impact on your operations based on variables like shipping patterns, average order profile, and current carrier mix. By doing the research, you can better focus on mitigation efforts in areas where you will the greatest return on investment.
Tip #2: Look for Opportunities To Consolidate or Downsize
With heftier surcharges for oversized packages, consider the DIM weight (dimensional weight) of your packages if you ship large items on a regular basis. Always make sure you are using the smallest package size and pack any contents efficiently.
In the case of multi-package orders, try to consolidate them into a single larger carton to reduce per package charges. With this strategy, you should still be wary of the DIM weight of your packages and any criteria for large packages and additional handling thresholds.
Tip #3: Adjust Volume to Remain Under Thresholds, If You Have A Multi-Carrier Network
If you are a shipper with a “split-carrier” network (for example, contracts with both FedEx and the UPS) or supplemental carriers like USPS or DHL, you have the opportunity to adjust volume in order to remain under delivery thresholds.
Tip #4: Negotiate!
Did you know you can negotiate surcharges with carriers? In the past, shippers have been able to work with their carrier to negotiate rates that will reduce the impact of peak season surcharges. It is still yet to be seen how willing and able FedEx or UPS will be to negotiate this holiday season, but it is worth your time to avoid cost if you can. Important to note is that you should make sure that when negotiating reduced peak season surcharges, you receive a commitment from the carrier that your negotiations will not result in new or more drastic volume caps.
Although this holiday season will likely prove to be the most challenging on record, with the proper planning, you’ll be able to find shipping success. If you find that parcel shipping is not your strong suit, consider partnering with a third-party logistics provider (3PL) like Fulfillment Works. We can develop a strategic approach to your parcel management and with well-located distribution facilities in the U.S., smart technology, and strong relationships with carriers, we are prepared to help you achieve your goals in this new parcel landscape.