Retailers have been facing quite a few challenges with the shopping season and COVID-19 impact. Team eCommerce Next interviewed Ms. Karen Tyndall, Director of Customer Solutions at GlobalTranz to get more insights on the topic. Following is our interview with her:
As many retailers shift their channel and delivery strategies, what common challenges are they seeing?
This peak shipping season, shippers are navigating the perfect storm of market conditions. Surging e-commerce orders, a tight truckload and LTL capacity, higher delivery surcharges and overwhelmed parcel carriers are all factors that retailers have to contend with during a holiday shopping season that will feel very different from past years.
As e-commerce continues to surge with earlier than usual holiday promotions, Amazon Prime Day and a cautious consumer population remaining home, brands are prioritizing customer delivery experience. Ensuring a seamless delivery process can have a lasting impact on profitability, customer loyalty and the health of a brand.
In a recent survey of supply chain decision-makers by GlobalTranz, 64 percent of respondents reported having dealt with more late or failed delivery in the last six months than what is typical. To combat this, retailers are investing in new delivery solutions and looking for transportation partnerships to alleviate delivery pain points.
How are you partnering with retailers to solve final mile delivery?
Delivery is now an essential brand touchpoint in the consumer buying experience today. The e-commerce boom of the last several months has only increased demand for ensuring packages arrive on time. 6 in 10 supply chain decision-makers reported in our recent survey that they’ve experienced an increase of customers wanting last-mile delivery solutions. Meaning that they want their order delivered right to their door. As more retailers ship directly to consumers, they need to rethink how they’re interfacing with them.
There’s also demand for expanded “white glove” services that go beyond delivering a package at the doorstep. For larger items, such as furniture or exercise equipment, this means managing the in-home installation experience or haul away. Retailers have to trust their transportation partners to deliver a brand experience that is commensurate with their customers’ expectations.
As an example, we worked with an exercise equipment company in the early stages of home lockdowns to shift their delivery model. Prior to the pandemic, they sold and delivered their products directly to gyms as bulk orders. With people under stay at home orders, the company saw a massive spike in requests for residential deliveries. We helped them design and implement a new delivery strategy that enabled them to meet this shift in demand for their product and manage beyond doorstep delivery to install their product into a person’s home.
What kind services or solutions are you providing to your shipper customers?
To meet new customer needs, we’ve launched new Final Mile and White Glove delivery services to ensure shipments are delivered on-time, on-brand and in-budget. Our Pop Up Fleet solution offers an alternative for high-volume shippers in need of pre-set rates and locked in capacity.
We’ve partnered with our customers to manage the shift to e-commerce for the past several years, but the events of the pandemic accelerated the need for a lot of these solutions. We launched our Doorstep Delivery solution to manage the huge spike that retailers have experienced in home delivery due to the fact that the parcel networks are backed up and, in some cases, rejecting parcels.
An often-overlooked piece of the e-commerce boom is reverse logistics. Returns can be a costly expense for shippers, and the process is further complicated if it involves large items such as furniture. All the same, shippers have to prepare to manage returns, and GlobalTranz offers integrated reverse logistics capability to make handling returns easier.
How have the past several months positioned companies to meet demand during peak shipping season?
At the start of the pandemic, retailers of all sizes quickly pivoted their strategies to both reach new customers and deliver their products more efficiently. From our survey of supply chain decision-makers, 65% reported adopting a successful omnichannel strategy to reach consumers from a multichannel approach.
We expect that retailers that made shifts in their channel and supply chain strategies will be well positioned to capitalize on what’s expected to be a record online holiday shopping season. At the same time, the rapid changes in supply chain strategy, whether reallocation of warehouses and fulfillment centers or expanded e-commerce offerings, have forced many retailers to operate under many unknowns. Those that can manage this risk through visibility throughout their supply chain will be able to continue to pivot in the changing environment and meet their customers’ needs.
How does COVID continue to impact final mile delivery?
The pandemic environment continues to drive a higher level of residential deliveries than what shippers are used to seeing. Final mile has always been part of future plans for many shippers, but retailers have been forced to quickly implement and troubleshoot new processes at scale. Eliminating or at least reducing delays is the priority, but delivery on customer expectations in terms of providing real-time updates and added delivery services are also top of mind.
Long-term, how do you see this spike in e-commerce demand impacting delivery strategy and investment in new solutions like final mile going forward?
Prior to 2020, many companies had already made significant investments in e-commerce and were planning for continued growth. The pandemic accelerated the growth of e-commerce and we can expect online shopping to continue to grow in 2021.
For context, consumer e-commerce sales expanded more than 30% between the first and second quarter of 2020. As a result, by October of this year, online spending had already exceeded total online spending in all of 2019. We don’t expect that spike to disappear even with physical retail locations reopening, as many consumers have adopted and become accustomed to new buying habits.
That said, there are still issues to solve within supply chain networks and rethinking the delivery experience. With the heightened focus around e-commerce this year, we’ll see retailers prioritizing their supply chain strategy around e-commerce much more.
What can retailers do to plan around fluctuating consumer demand going forward?
Companies across all industries have been focused on meeting their immediate needs in the current environment, which has largely meant getting their products to the end-user on time. In many respects, the pandemic motivated companies to further invest in getting their products closer to the customer, whether that means warehouse space closer to population centers or reshoring their supply chains. For retailers in particular, we’ve seen a trend of using their stores as fulfillment centers to offset the need for space in a separate facility.
Supply chain optimization software is making a huge difference for businesses as they look for more visibility across their supply chain. If a company is able to integrate and view all the data in one place through a transportation management system it creates a lot more visibility in their supply chains so that they can think holistically about their needs and adapt accordingly. The investment in digital tools that provide the data and insight that allows for customization around supply chain operations is significant as resiliency takes on greater importance in a post-COVID-19 world.
GlobalTranz is a full-service third-party logistics provider, bringing award-winning customer service, exceptional industry expertise and market-leading technology to shippers, carriers, and logistics service providers (LSP). GlobalTranz’s people- powered approach combined with comprehensive, relationship-driven support provides shippers of all sizes with fast and reliable, multi-modal transportation services as well as strategic supply chain solutions – enabling them to optimize efficiency and deliver on business goals. Leveraging its extensive independent agent network, GlobalTranz has emerged as a fast-growing market leader with a customer base of over 1 million product users and 25,000 shippers. In 2020, Transport Topics named GlobalTranz #9 on their list of Top 10 largest freight brokerage firms in the U.S., and Inbound Logistics ranked GlobalTranz as #4 on their list of Top 10 3PL Providers.