Parcel shipping efficiency remains troublesome for many supply chain leaders. As e-commerce swells, parcel demand and multimodal activity also increases. As a result, shippers and logistics service providers (LSPs) must deal with added stressors throughout the network. Native parcel shipping solutions can have a significant impact.
As further explained by Steve Banker of Forbes, “The fulfillment demands of the e-commerce boom are also making warehouse labor extremely tight. Warehouses are finding it increasingly difficult to fill open warehouse jobs. The current environment is best exemplified by what a 3PL executive said: If an ex-con with a burglary record shows up, we say [that] we know you will steal from us, but we can use the help. You’re hired!” Fortunately, companies that deploy integrated parcel shipping solutions can overcome these problems and derive more value from their supply chains.
Why Disparate Parcel Management Creates Major Hurdles to Efficiency
Disparate parcel management practices and systems might work for the time being.
However, it’s only a matter of time before existing systems reach their maximum scalability. At that point, the system will fail. Additionally, other problems may arise in using multiple, limited methods that result in trouble managing limited parcel shipping solutions.
Take this example, published by Supply Chain Dive, “It’s also very easy for e-commerce operations to overlook inventory levels when fast fulfillment is the number one priority. Quite often your KPIs are related to customer order fulfillment. [Companies must] manage the reverse flow incoming, not just outgoing, but…that is not always the case.”
And in the case of parcel, it’s an immense volume that comes from all directions. If systems cannot communicate, countless minor problems become huge obstacles to efficiency. Without the right metrics to track parcel shipping performance, the whole operation is subject to poor visibility and limited profitability.
Integrated Parcel Shipping Solutions Consider the Whole Picture
- Use EDI and API to connect all supply chain systems. Joining the full supply chain to consider parcel transportation solutions when moving all items helps create more savings opportunities.
- Offer competitive rates based on leading market indices. Using market indices reduces tender rejections by ensuring all parcel ratings are reflective of actual market conditions.
- Avoid problems during consolidation and deconsolidation by gaining end-to-end transparency. Since parcels are most likely to endure consolidation and deconsolidation, gaining access into all movements, even when part of a more massive, consolidated shipment, is another critical functionality afforded by integrated parcel shipping solutions.
- Identify opportunities to apply multimodal routing to parcels to save resources. While multimodal is most readily associated with parcels’ consolidation, it’s important to remember that this is not limited to OTR moves. It may include a mix of air, land, and sea transportation, and any combination may result in improved costs and require fewer resources when adequately optimized.
- Keep the dock schedule running smoothly with real-time reporting and GPS-provided truck status updates. Again, connecting with freight while in-transit and knowing what to expect from arrivals/departures reduces confusion at the dock and streamlines yard management.