More Packages Delivered on Time for the Holidays in 2014

LDL Voice

In the wake of 2013’s winter holiday shipping challenges, supply chain professionals and consumers alike anxiously anticipated how the 2014 shipping surge would play out. We’re happy to report that both retailers and carriers improved their holiday delivery performance in 2014. A survey conducted by retail-intelligence firm StellaService found that only 7 percent of packages ordered from U.S. retailers online did not arrive by their promised delivery date, compared with 12 percent the previous holiday season (Reuters).

According to logistics software firm ShipMatrix, FedEx and UPS both delivered 98 percent of express packages on time by Christmas Eve. This is significantly better performance than in 2013, when an estimated 2 million express packages were left stranded on Christmas Eve due to a surge in last-minute online purchases and hazardous weather conditions (The Washington Post).

The improved performance comes down two things: better planning and a little help from Mother Nature. After last year’s snafus, FedEx and UPS each set out to improve their logistics infrastructure by building new facilities and hiring about 10,000 more seasonal workers than they had the previous year.  They also pushed for more accurate package-volume forecasts from retailers. Retailers did their part by offering fewer last-minute online promotions. These improvements, mixed with favorable weather in 2014, contributed to the increase in timely deliveries (Reuters).

Though investments by carriers and better scheduling and forecasting by retailers paid off, some retailers still fell short of their promise to deliver by Christmas. One thing retailers can do to improve in 2015 is make sure they consistently select the correct shipping method. In 2014, many retailers shipped packages via carriers’ ground delivery service instead of using a guaranteed express service. Though pricier, using a guaranteed service would have ensured on-time delivery. With an ever-growing demand for e-commerce orders, it’s difficult to accurately forecast holiday demand, but a continued effort to do so may help retailers improve their customer experience in the future.

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