Like 2020, the year 2021 was a significant one for the world. Although businesses expected to see changes when vaccines for Coronavirus became available, many analysts found that consumers continued new habits of shopping online for convenience and larger inventory selections. Additionally, both locally and internationally, companies still encountered problems with shipping. Add to this a labor shortage, and businesses were scrambling for the most important time of year, the fourth quarter. Many of these factors were beyond the businesses' control, but that does not mean we cannot learn from them. A number of logistical mistakes were made by businesses, making these uncontrollable factors more difficult to cope with. Listed below are the major mistakes that e-commerce companies made in 2021 that should be avoided in 2022:
Mistake #1: Lack of Modern Technology
In recent years, advanced technology has infiltrated every industry, including the shipping industry. It is surprising to see how many businesses are still using excel files to store data or process orders. If you are still processing orders order by order, this is your warning to STOP! These methods waste time and money. Logistics and shipping companies benefit from cloud-based inventory management systems, application programming interfaces (APIs), order management systems (OMSs), and other systems. In addition to helping you keep organized, a cloud-based shipping solution, such as DesktopShipper, will help you reduce the time you spend entering orders and, ultimately, will decrease error rates that may lead to upset clients and disruptions in your supply chain. Although traditionalists claim that they do not trust cloud-based technology, the reality is that if you have been using old-school technology or technological systems that do not communicate with one another, the end result may be inaccurate shipping times, inconsistencies with inventory demands, and issues with automation. As a result, these problems tarnish consumers' views of your company and may deter them from purchasing from you in the future. By harnessing shipping technology, we can reduce inefficiencies and optimize routes, integrate multiple systems, provide faster fulfillment, and automate repetitive tasks, while also significantly reducing shipping costs. Companies today must leverage cloud-based technologies in order to remain competitive.
Mistake #2: Lack of Carrier Diversity
An increase in operational efficiency for retailers can certainly be achieved with the assistance of national carriers. Although many companies have a loyalty to a particular carrier, which we consider a good thing, it is also not a bad idea to shop around. When selecting a carrier, you should remember that it is more than simply getting your packages delivered; it is an extension of your business since it interacts with your clients more than you do. It is likely that the bulk of your shipping volume is handled by large national carriers, however, it can be difficult for large carriers to deliver to niche areas. In order for shippers to be able to fulfill capacity needs as easily and as often as possible, it is vital they establish relationships with a variety of carriers. Establishing accounts with multiple carriers will significantly improve the efficiency of your supply chain. Utilizing multiple carriers also provides the opportunity to shop around for the best price per package, thereby saving money on every delivery, so it is important to consider both national and local carriers when expanding your list.
Mistake #3: Lack of Rate Shopping
The process of rate shopping involves comparing carriers and their shipping rates, as well as assessing the dimensions and weight of the package and identifying the route and/or carrier that is the cheapest. In the absence of modern technology and carrier options, shoppers will not be able to shop for the best rates. Along with comparing all the major carriers, you can create profiles that compare special services, such as overnight shipping, and the software will find the best rate among your preferred carriers. The process of carrier rate shopping is automated, making it a wise decision for shippers. Integrating with multiple carriers will help you find truly the best price available. Let technology work for you!
Mistake #4: Lack of Parcel Insurance
Those who are new to e-commerce delivery might not realize how problematic package theft, lost packages, or broken items can be. Although insurance may seem unnecessary, it's essential when it comes to our industry. 36% of all online orders were reported to be stolen in 2019. By 2020, that grew to 43%. Regardless of how dependable a shipping service is, unpredictable situations or accidents can always occur. With the shipping industry being what it is today, struggling with labor shortages and a shipping crisis, there is a large room for error. Even with the most reliable of carriers, missing items inside packages, broken items, and just general lost items occur more frequently than one would expect. Generally speaking, insurance through carriers does not cover everything, so it is the companies' responsibility to make sure they have coverage for the unexpected. Your business's reputation is on the line. Purchasing parcel insurance is truly the most effective way to protect your business from lost, stolen or broken items. By spending a little bit more upfront, you may prevent potential headaches in the future.
Mistake #5: Lack of Adequate Planning
It’s no secret that various factors can cause delays in order deliveries. Despite our best efforts, it is not possible to predict when unforeseen issues may pop up. Take for instance the current shipping crisis. What started this year now has reason to believe will most likely last until 2023. Industry experts believe there may be a delay in inventory of up to 4 months, depending on your products. That means you must plan, plan, plan! To avoid being overwhelmed by all the possible events that could occur, it is advisable to create a buffer zone or cushion within your delivery timeline. Keeping an eye on past sales and data can be a helpful way to plan for the future. Information can be your greatest ally in making informed decisions. The key to planning effectively is leveraging order management, supply chain analysis, and consumer trends.
E-commerce experts are still unsure what is going to happen, so don’t get caught lacking! Even if labor shortages and supply chain issues disappear in a month, their impact on business operations will persist for years to come. Do not repeat the same mistakes that many companies made in 2021. Let the team at DesktopShipper help you with quick, reliable, and cost-effective shipping domestically and internationally! As a leading cloud-based shipping solution, we excel at meeting your needs quickly and effectively, from order management and real-time rate shopping to carrier profiles, and parcel insurance integrations. Check out how DesktopShipper and our partners can help you today!