UPS admits to struggles shipping last-minute orders
Retailers often rely on third-party logistics providers to fulfill their end of the bargain in order to get purchases to customers in a timely fashion. However, when delivery services, like United Parcel Service (UPS), have trouble shipping orders, both the merchant and the service provider are at fault in the eyes of the customer and the online shopping experience suffers.
Like many third-party logistics companies, UPS struggled during the holiday season to get orders in the hands of consumers in time for Christmas. The company recently admitted that it was completely unprepared for the surge in last-minute purchases, which not only hurt the company’s bottom line but also jeopardized its reputation in the eyes of customers and merchants.
“Shipments of online orders significantly exceeded even our most optimistic forecasts as more and more Americans shopped online,” UPS CEO Scott Davis told investors and analysts in the company’s latest earnings report. “The surge in volume and inclement weather strained our network, causing delays.”
More than 29 million packages were delivered daily in the run up to Christmas, peaking on December 23 with more than 31 million purchases shipped out to customers, according to Internet Retailer. The company knew it would be dealing with a challenging holiday season this year, particularly because Thanksgiving fell so late and Black Friday tends to mark the starting date of the holiday shopping season.
For online retailers, the UPS incident should highlight the importance of taking a more active role into integrating third-party logistics software with their eCommerce software in order to receive real-time updates and ensure the online shopping experience is positive. Supply chain, distribution and delivery are all important parts of successful eCommerce operations, and by being in the know about early, on-time, and late shipments retailers can provide their customers with real-time insight on their order status. This also can help a retailer become aware of when a customer might need to be accommodated, in the case of a late delivery, before the customer becomes unhappy and expectations are lowered.