The global COVID-19 pandemic brought a surge of online shopping to all areas of the world. People were spending more time at home and trying to limit their exposure to the world and changed their shopping habits with just one click.
While this way of shopping has been transformational for the consumer and has brought freedom of time to individuals, it has created challenges within the logistics industry that could not have been predicted.
The holiday season brings a set of unique challenges as companies worldwide are preparing to ship most of their purchases. Studies have shown that only 4 out of 10 consumers plan to make a trip to a physical store location for their shopping needs this year. This drastic decrease in physical shoppers has caused a significant delay in freight shipping.
Shipping ports worldwide are backlogged with an enormous amount of cargo from all of the online orders. It has reached such a point that now experts are saying there is an 80% chance you will not receive a parcel on time - up a whopping 40% from last year.
It's not just shipping ports that are backlogged. Truck drivers are in short supply, and air terminals constantly receive large amounts of freight to be processed.
In August, 36 container ships were anchored off a port in Los Angeles due to backups. The reality is that before the COVID-19 pandemic, backlogs like this were very rarely if ever, experienced. Retailers everywhere will be stocking up on inventory to meet customers' demands this holiday season and are looking for the best ways to ship their products out in the most reliable, fastest ways possible.
The Impact on the Retailer
The increase in shopping that we have seen over the year and a half have made it harder for the retailer to keep their goods in stock. Large companies like Adidas have struggled to meet the demand for products due to the shutdowns in their production factories due to COVID-19 and the rate of purchases.
Major companies that have suppliers and production facilities within Asia have struggled to maintain the same production rates that they had pre-pandemic, causing a shortage in goods and delays in shipping. "Out of Stock" signs have lined shelves for months now and until the virus can get under control.
How Does This Impact Me?
You may hear this news and think there is no hope for the holiday season. That is not true! There are just a few ways to become a smarter retailer and get your goods out to your valued customers on time.
Start your marketing engines and begin to promote holiday shopping early! A survey showed that 1 in 3 online shoppers begin their Christmas shopping before Labor Day. The earlier you can purchase gifts, the better! While gift-giving can sometimes be a spur of the moment, spontaneous event, the new reality of the shopping world is that spontaneous gifts might not be delivered by the time you need them. Encourage your shoppers to plan out their gift list and start buying early. This will put you both at ease!
Collect Your Tools
The best way that you can prepare for the holiday rush is to ensure you have everything in place. Put in higher orders for your inventory, so you do not run out of your stock before the holidays even arrive.
Make sure you are also stocking up on your shipping supplies. You want to get your stock out right away, so to be safe, have a few extra boxes to ensure there are no delays on your end. Customers want good shipping options, and with Amazon as the biggest competitor, it is vital that you are well-equipped to ship out your goods in the most effective way possible.
Set a Deadline
While this deadline can be considered "soft," you should begin to advertise dates where shoppers will have to have their orders in to have some guarantees for on-time arrival. This not only helps shoppers manage expectations but allows you to plan for the bulk of your orders to be placed by a specific time.