Businesses that rely on shipping vendors to fulfill customer orders are facing increased rates, slow delivery times, and customer dissatisfaction. These are challenges that can impact your bottom line and effect your overall profitability.
With the increased demand for product shipping, you want to make sure that your shipping vendor/provider is operating smoothly. Perhaps they cannot keep up with the rise in demand and failing to fulfill orders on time. By knowing the kind of challenges your providers may face can help you develop a stronger shipping and fulfillment strategy.
The problems your shipping provider will trickle down to you and affect your profits!
Lack of Labor
With a growth in demand for shipping services, there is going to be a rise in need for skilled labour. Workers who can commit to long, undesirable hours or physically demanding positions can be hard to come by. Such roles are critical in ensuring customers receive their goods on time and safely, so shipping providers are always on the lookout for able minded and able-bodied individuals to fill these roles.
Some providers may look into using automation to help reduce the stress and costs of labour, but not everything can be handled this way. Even if automation is used, there is still the need to have someone maintaining, repairing, and implementing technology.
If there is a labour shortage going on, you can guarantee that your shipping provider will be impacted.
Speed and Efficiency
Large companies like Amazon have set a new standard for shipping. Same-day or next-day deliveries are often expected by your average customer, but not every shipping provider can meet these expectations. Logistically speaking, most shipping providers will find it difficult to ensure the process is done right if they are rushing through orders. This can lead to more mistakes and more disgruntled customers. Drivers and warehouse staff may find this incredibly taxing as well since fast delivery times almost always means increased physical labour.
Rising Demands Can Be Hard To Meet
With constant growth in the e-commerce space, shipping providers may find it challenging to keep up with rise in demand. The average consumer orders 64 packages per year. With thousands of customers, small shipping vendors will be unable to fulfill these orders with efficiency and accuracy. Failing to meet this demand can then lead to customer dissatisfaction and decreased loyalty.
Sustainability Concerns
Consumers have become more environmentally aware when it comes to their preferred methods of shopping. Businesses are expected to be transparent on the materials used for their products and shipping while also meeting goals to reduce their carbon footprints. This would result in businesses having to balance their budgets to reduce their environmental impact while still making a profit. If your carrier does not take environmental concerns seriously, consumers will know this and it will have a detrimental affect on your brand.
Rising Prices Means Rising Rates
Labour, fuel, supplies, technology are getting more expensive as time goes on. Your shipping provider will have to increase rates to match these expenses, so be on the look out for extra costs that your provider may incur. You don’t want unexpected increases to affect your bottom line.
In Conclusion…
The problems that your shipping provider faces are ultimately your problems too. Whether it’s rising costs or a rise in demand, there are many different factors that can have negative effects on your business. To find out if your shipping provider may be right for you, Watchdog Management Services is here to help you find out where you can be saving on costs. Get in touch today!
