Navigating a Shipping Crisis as a Small Parcel Shipper
Updated: 2 days ago
As an e-commerce professional, you are no stranger to the shipping crisis brought on by this pandemic. Worldwide shutdowns caused shipping delays overseas, which led to empty shelves and boats stuck at ports. In the current economic climate, cargo shipping prices are rising, resulting in higher prices for consumers. This means companies are in a dilemma over whether to maintain prices at the current level or increase them to cover costs. Several other factors have contributed to the current difficulties, affecting many parts of the e-commerce industry.
According to shipping experts, the shipping crisis is expected to end in 2023. In an interview with the Financial Times, the CEO of freight company Ocean Network Express, Jeremy Nixon, states “that [the] local governments need to increase spending on critical parts of the supply chain– including ports, railways, warehouses, and roads– to increase capacity and cope with ongoing demand.” The White House announced in October of 2021 to help with the clogs in the Los Angeles ports with 24 hours and seven days a week work schedule to fix the shipping crisis. Despite this intervention by the US Government, specialists are wary that this will change things. Brian Whitlock, a supply chain analyst at Gartner, says,” it’s great that they’ve chosen to do something, but we’re talking about a less than 1 to 2% change here… the work they’re talking about here is going to be immaterial. It probably won’t even be visible.” On top of this tiny bit of help from the US, Jeremy Nixon mentioned that in 2022 there would be contract negotiations in US West Coast ports between dockworkers and terminal operations, which has led to delays and backups.
It’s safe to say that the shipping crisis will never go anywhere quickly. How does the current international shipping crisis impact small parcel e-commerce shippers? For starters, it can increase the prices of your goods. It can also take longer to get your goods or restock your shelves. Because it causes riffs in the international supply chain, it can also affect the local supply chain. In reality, this shipping crisis causes a strain on the whole industry. Many large businesses have the capital and resources to head the supply chain crisis. Companies like Amazon have started spending more money on air freight to get products from overseas and build up freight infrastructure so they don’t have to rely on a third party. Companies that don’t have the cash are a little more stuck.
So, how do companies that don’t have billions of dollars to spend on logistics navigate this crisis?
Communicate with Customers
Customers need to be informed. Good customer service requires effective communication with customers. This is the best method of retaining current customers and acquiring new ones. Communication not only means emails about promotions, but emails about when something is purchased, shipped, and any other notifications in between the shipping process. If something takes longer to be restocked, it needs to be communicated with customers. Everything to do with shipping and order fulfillment is essential to keep customers informed.
Several businesses have discussed re-routing their cargo shipments to ports not as busy as those in California. You must be wise about planning if you cannot afford to make that decision. Rather than ordering items three months in advance, aim for six months instead. An alternative option, which might not be the best choice for everyone, is to order items that are not seasonal in nature. The pandemic caused many companies to lose a great deal of money, as, by the time their shipments arrived, the items were no longer appropriate for the season. For instance, Christmas ornaments were no longer relevant if they came after the new year. Be strategic about timing, ROI on shipments, and overall shipping timeline.
By using technology, you can have some control over a situation that appears uncontrollable. Various technologies can enhance consumers' shopping experience, including selling platforms and marketplaces, order management systems, inventory management systems, and shipping software, which can alleviate the effects of the economic crisis. Stacking these technology integrations allows consumers to shop more efficiently, ensure up-to-date inventory, and automate the label-generating process. Utilizing shipping software, such as DesktopShipper, can help your business centralize its shipping, get the best shipping prices, and ship packages quickly. Streamline the process by using a shipping solution. Your employees and customers will thank you.