New York, NY — Forbes Insights announced a new report, in association with Pitney Bowes, titled “Shipping as Strategy: How Small and Midsize Retailers Can Best Meet Customers’ Delivery Expectations in the Age of Amazon,” which examines how small and midsize merchants are being challenged by shipping costs and how they can compete more effectively.
Amazon and other large retailers set customer shipping expectations by offering expedited delivery options at low or no cost to the customer. Retailers of all sizes must compete on the same turf to meet customer expectations. Yet, without the shipping volumes of Amazon, most retailers lack the negotiating power that could net meaningful discounts with commercial carriers. In addition, private carriers often assess charges such as delivering to a residential address, penalties for failing to meet contracted volumes, and peak holiday premium surcharges.
These issues are exacerbated by the parcel shipping systems deployed by many retailers. While most retailers make use of the carrier-specific shipping software provided by commercial carriers to handle the bulk of their shipping, aspects of these same systems make it cumbersome for shippers to switch carriers seamlessly and access more favorable pricing. Shippers also underutilize the United States Postal Service, with its broad geographic, six-day-a-week residential delivery schedule and up-front pricing structure.
All these challenges can be managed with a shipping strategy that not only includes automation and a mix of carriers including the USPS, but also addresses the significant merchant need for payment flexibility, delivery incentives and global reach. Many organizations offer bits and pieces of this strategy, but the right shipping partner would offer all three critical elements.
“Retailers should be careful about locking themselves into carrier-specific software,” said Bruce Rogers, Chief Insights Officer at Forbes Media, “and make smart use of the post office.”
“Industry data, including our latest Pitney Bowes Global Online Shopping Study, strongly supports the requirement by merchants for greater flexibility in terms and timing for payments, assurances on delivery execution, and global reach, in a world where 70% of consumers have shopped cross-border,” said Michael Griffiths, Vice President, Global Marketing & Communications, Retail & ECommerce, Pitney Bowes.
Create a multi-carrier strategy: Review your carriers and pricing. Discuss your options with other services in your area. Will you offer next-day or same-day shipping? Is the USPS part of your existing shipping mix?
Use the USPS: The upgrades the Postal Service has made over the past several years coupled with its scale of presence across the United States six days per week, makes it very well positioned for B2C deliveries. Look at how and where flat-rate packaging can help you save money. Pick up some flat-rate packaging from the Post Office and experiment.
Have a plan for peak periods: All carriers have challenges with parcel volume during peak shipping season, including delays to delivery that don’t meet their normal service standards. Prepare for high-volume shopping periods by scaling up available labor as needed for pick up, pack, ship and customer service. Forge a relationship with your carriers so that you know in advance what their deadlines and cut-off dates are. Keep the communication lines open during peak periods. And have a contingency plan in place—failovers to different carriers, if necessary.
Automate the process: Think about where automation can help your business and support a multi-carrier strategy. Automate your processes as much as you can from click to delivery.
Identify the right shipping partner: Look for partners that can provide service guarantees, favorable pricing and payment terms, without limiting your ability to go global—all of which should lead to deeper savings for you.
Know your products and know your options: That means knowing your data, product dimensions, weight and more. Import that data into the system and the software can “fill in the blanks.”