Batteries are running the world. OK, not literally. However, according to a report from Market Research Future, the global battery market is expected to grow at a 4 percent compound annual growth rate (CAGR) between this year and 2023. While the automotive sector is expected to fuel this growth as companies look to alternatives to gas-powered vehicles, cell phones, laptops, and other portable electronic devices and the overall increasing dependence on technology are contributing to the rise in battery usage in a big way.
We all know that too many businesses have too many people wearing too many hats, and as parcel shipping becomes more complex, more shippers are turning to 3PLs to help them take off a hat or two.
According to the 29th Annual Council of Supply Chain Management Professionals (CSCMP) State of Logistics Report, parcel shipping spend topped $99 billion, a 7 percent growth in 2017 compared to 2016, driven in large part by eCommerce. Shippers are looking for help with everything from rate negotiations to parcel shipping systems to last-mile logistics.
As a result, the market is seeing many 3PLs jump into the fray, and the competition for business is getting fierce. With the fight for carrier capacity, it is not enough for 3PLs to be one-dimensional in their service offerings. Their clients will simply move on.
Parcel shipping technology is evolving—quickly. From eCommerce to manufacturing and more, shippers are managing and coordinating more delivery methods than ever to keep up with customer needs. No longer will one carrier or one distribution model do. Whether shipping shoes to a consumer or parts to a plant, parcel shipping has become a multi-carrier, omnichannel endeavor and a robust parcel shipping platform is needed now more than ever. That’s one of the things that Ken Fleming, chief operating officer at Logistyx Technologies, discussed in a recent webinar, “The Future of Multi-Carrier Shipping Systems (Beyond the Shipping Label).” And we couldn’t agree more.
Increasingly, businesses are turning to cloud-based transportation management systems (TMS) to automate business processes to save not just money, but time. In fact, worldwide revenue in the TMS sector is poised to surge from $9.6 billion in 2016 to an expected $30.04 billion by the end of 2025, indicating a compound annual growth rate (CAGR) of 13.6 percent, according to a study reported by DC Velocity. The increase of cloud-based TMS is an essential factor in the growth.
While the move to the cloud is easier than ever as implementation time and associated costs are falling, there are five things shippers should consider when evaluating production-level performance of their cloud-based parcel shipping system in a business environment where every second counts:
Every day, parcels containing hazardous materials (hazmat) are transported across the country and across the globe. The good news is that the U.S. Department of Transportation (DOT) protects the public by strictly regulating businesses introducing hazardous materials into the stream of commerce. The bad news for shippers of hazardous goods: you better understand the regulations, or you will face sanctions, penalties, and if grossly negligent … jail time. And rightly so. But, while you may be doing your best to control your hazmat shipments, there are some things that may be slipping through the cracks, putting your customers, staff, and company at risk.
While some joke about Christmas decorations on display at their local supermarket before Halloween as “being too early,” eCommerce and retail players know that it is never too early to think about the holiday season.
The retail industry banks on the holidays to meet its annual revenue targets. In fact, in 2017, the holiday season accounted for $687.87 billion in sales, according to the National Retail Federation (NRF). Of those total retail sales, $108.15 billion was spent online during the holiday season, reported Internet Retailer, making last year’s peak season busier than ever for shippers and carriers as both retail and e-tail players scrambled to deliver gifts on time to residences.
So, with all that history, what is in store (pun intended) for this coming holiday season?
While the focus tends to be on eCommerce, rising parcel shipping costs are a concern for just about any business today. With free shipping now an entrenched customer expectation, it is more important than ever for shippers to keep shipping costs in line. But as almost every carrier is adding new surcharges and accessorial fees to account for specialty services, there is a widening gap between what shippers expect to pay vs. what they are actually invoiced. With the correct parcel software and a little know-how, it is possible to minimize unexpected and unnecessary surcharges and fees.
It’s long been said that to be successful, you must go where the business is. For 3PLs, the business for parcel shipping is just about everywhere, and it is growing.
eCommerce is not constrained by national borders so shipping is now more than ever an international game filled with its own trials and tribulations. And that isn’t about to change based on reports in Pitney Bowes’ Parcel Shipping Index, which was released in August. The report indicated that parcel shipping generated $279 billion in revenue last year, an increase of 11 percent over 2016, and is expected to top 100 billion parcels shipped by 2020.
A quick—OK, not so quick—read of the 2019 22nd Annual Third-Party Logistics Study reveals, as we reported here, that the use of 3PL firms is growing. So, while not every parcel shipper has turned to an intermediary for help yet, the odds are that they will.
The study, which was released by Infosys Consulting, Penn State University, Penske Logistics, and Korn Ferry during the recent Council of Supply Chain Management Professionals (CSCMP) Edge conference in Nashville, Tenn., shows an increase in the use of 3PLs as 63 percent of shippers said they would outsource more of their logistics operations in 2018, compared to 61 percent in 2017. And among the 3PL companies that responded to the survey, 86 percent said their customers were keeping them busier, up from 83 percent the prior year.
Become a better parcel shipper to reduce costs, increase margins, improve customer service, and stay competitive. Stay informed on the latest trends in shipping and parcel transportation management. Delivered regularly by email and through social media.