We all know that the holiday peak shipping season can bring challenges. Supply chain disruptions of the last few years have made it difficult to predict exactly how this holiday season will go. Figuring out what needs to be prioritized during this busy season is part of a good logistics strategy.

Retailers must review their logistics strategy in order to ensure products are available when consumers want them for the holidays. Being able to make adjustments now helps to create a positive customer experience and minimize the hectic nature of the holiday season.

Mitigate Holiday Surcharges

The holiday surcharges that came about in 2020 will continue this year. Parcel shipping prices increased by 6% last year with another possible increase in 2022. International shipping may increase even more than domestic shipping.  The rise in inflation as well as higher diesel fuel prices will create higher carrier costs for this holiday season.

To counteract these increases, retailers need to look for ways to curb excessive spending, as well as ways to save on shipping. Being able to ship from different locations or consolidating existing locations can cut costs. Retailers should consider putting out contracts for carrier pricing every few years to make sure they are at market rates. Third-party audit firms are helpful in this case to review contracts and audit carrier invoices to find savings. Being able to mitigate the effect of carrier increases without just passing the increase along to the consumer is critical for maintaining margins.

Deal With Labor Shortages

Labor shortages are affecting all parts of the U.S. economy, but the transportation industry has been hit particularly hard. Many carriers are not able to meet service-level agreements (SLAs) and adjust to their customers’ changing business needs because of a lack of staff. E-commerce companies should readjust their supply chain strategy, including changing partners, consolidating inventory locations, or modifying supply the supply chain to be able to meet the expectations of consumers while cutting costs.

Successful companies usually have several backup plans to deal with disruptions that will continue throughout the remainder of this year. Investing in technology and automation is one way to deal with labor shortages. Retailers should also look for partners who are working on long-term solutions for these kinds of disruptions.

Communicate with Customers

Throughout the 2022 holiday season, e-commerce brands need to focus on being transparent with their customers to set realistic expectations and build a relationship. Giving all the information related to inventory shortages, shipping, port delays, delivery, and any additional fees can improve the customer experience.

In order to better communicate with customers, including logistics information on e-commerce websites on the product pages or during the checkout. This will increase transparency and set expectations. Retailers must monitor their supply chain and fulfillment process to provide the most accurate, real-time information to their customers.

Due to the last two years, customers have more realistic expectations, but retailers should continue to focus on communication and logistics to keep customers beyond the holidays.  Open and honest communication during an important buying period builds customer loyalty.

Optimize Fulfillment

An increasing number of consumers are making online purchases, but brick-and-mortar stores can still add significant value to the customer experience. The rise in the process of buying online and picking up in-store will continue during the 2022 season. Last holiday season, 18% of all online orders on Cyber Monday included curbside pickup at a retail location. Brands that have physical stores might want to use them as fulfillment locations and make the customer experience better with communication, staff training, and signage.

Holiday Season 2022

Most likely, the supply chain disruptions that have plagued the industry for the year will not be resolved within the next few weeks. The best way to deal with the holiday season is to be proactive in addressing issues with customers and have full transparency in the shipping process. Creating a holiday logistics strategy will help you navigate anything this important season brings your way. Red Arrow Logistics can help you keep to your strategy and get your shipments out this season.