There’s no doubt about it: This is a holiday season like no other. Here at FourKites, we’ve been keeping a close eye on what our data tells us about both the availability of goods, and the demand patterns consumers are displaying.
What we’re seeing is that even as shoppers are homebound more than any other holiday season, they’re also shopping more than ever before – with the vast majority of that activity is taking place online. This massive uptick in e-commerce is, in turn, necessitating a change in the ways that manufacturers, distributors and retailers transport their wares to the end consumer, forcing them to rely more heavily on less-than-truckload and parcel shipments.
All of this is occurring against a backdrop of stretched shipping capacity throughout the industry. With fewer trucks, warehousing space, pallets and containers available to transport goods, rates are rising and shippers are forced to compete not only for customers’ attention online, but also the means to make good on those orders once they have been placed. Amidst this complicated landscape, the companies that come out ahead will be those agile enough to adjust to changing dynamics both quickly and efficiently.
FourKites’ research earlier this month showed consumers stocking up on essentials, and that trend isn’t showing signs of a slowdown. Historically, F&B and CPG volume peaks through the week of Christmas and then falls off the first few weeks of January.
FourKites data indicate that we are squarely in the midst of the last-minute holiday shopping frenzy:
Despite these increases, we’ve seen a decline in dwell time of 43% both in the US and around the world. This decline indicates better planning and optimization, just as we saw around the spike in shipments on Amazon Prime Day. Better planning, prepaid shipment visibility and more robust collaborative planning – both on the supply-side and on the demand-side – are all contributing to a supply chain that is more capable of handling variability in sales and shipment volumes. Moreover, by using live transit data and predictive ETAs, integrated with yard and facilities management capabilities, receivers are empowered to accelerate gate-in and gate-out processes, shorten on-site time for drivers and optimize inventory across multiple sites, thereby reducing dwell times and increasing operating margins in the process.
The counterpoint to all this activity is that disruptions continue to materialize, consumer preferences continue to change, and capacity remains stretched far beyond where it’s been in the recent past. The closer we get to the holidays, the tighter capacity is likely to become. So what can retailers do to overcome these challenges and live to plan another year?
Anyone who’s worked in the logistics industry knows that we are change managers, above all. Delays and challenges are nothing new, especially around the holidays. Situations and dynamics are in constant flux, and our job is to keep everything running smoothly regardless of those conditions. Right now, our top priority should be marshalling our resources to ensure that we have all the data transparency we need to remain agile and keep goods moving as smoothly as possible.
As more and more sales decisions take place outside of the physical premises of the store, business leaders need better data than ever in order to anticipate and plan for consumer behavior. Moreover, as businesses can no longer rely on customers to come to them, a focus on omnichannel shipping strategies and seamless, transparent delivery will be paramount to meeting consumers where they increasingly prefer: at home.