By Bryan Wyatt | Senior Manager, Transportation
From late November to December 23rd, major online retailers do their best to manage transportation and ensure on-time delivery—with varying levels of success.
If you’re shipping online orders this holiday season, you may want to take a page from an Atlanta-based retailer’s proven playbook, which shows that cooperation and collaboration make for better forecasting and transportation capacity planning.
This leading retailer’s 2014 transportation capacity process achieved an on-time delivery rate of 99.9% on a whopping 1.2 million online orders during the four weeks leading up to Christmas. And that’s with managing an inconsistent number of outbound trucks per day and multiple package sizes — spanning the gamut from small parcel items to heavy, odd-shaped bulky items such as artificial Christmas trees.
Two Steps to Achieving Near-Perfect On-Time Delivery
What’s the best way for shippers to mitigate seasonal capacity crunches and achieve record on-time delivery rates for online orders?
1. Understand projected overall sales, particularly when each item will be marketed, building strong internal communications channels.
- Clear, open communication between operations, marketing and finance (facilitated via regular bi-weekly or monthly meetings) are necessary to review current financials as well as upcoming operational goals or events of which finance should be aware. Later in the season, a weekly forecast review ensures projections are within an agreed margin of error and can be adjusted for any changes in the business. These steps better align your projected shipping demands with available carrier capacity.
2. Manage carriers to their capacity commitments and adjust the transportation capacity forecast based on actual performance results, leveraging daily metrics.
- You’ll need to hold yourself—and your carriers—accountable for conducting daily morning meetings to review the previous day’s performance and current day’s projections. By monitoring and reviewing daily total loads against capacity commitments (exposing where daily needs consistently outpace the committed capacity) you’ll quickly identify potential problems with carriers who may be struggling to cover all the loads, resulting in delays. The sooner you can alert carriers to your need for more capacity, the better chance you have of them filling the gap. This step also ensures you’re working with reliable carriers who will not give away their capacity to perhaps a squeakier wheel.
During seasonal peaks it is very easy to get behind on deliveries, especially when demand is at its highest. You have to stay in front of the wave or it will drown your operation. With ever-increasing competition, a retailer’s reliability and on-time delivery can make or break a customer’s experience. Reliably delivering on your promise dates is no longer a differentiating factor, it’s a requirement for doing business in the ecommerce space.
By implementing these simple tips, you can enable your operation to be even more successful and your customers will return to shop with a company they can count on to deliver on their commitments
Bryan Wyatt is Senior Manager of Chainalytics’ Transportation Consulting team is an expert with over 20 years of hands-on experience in transportation operations, strategic sourcing, data analysis and logistics planning.