Holiday shipping is always stressful when you’re running an eCommerce company. Many stores receive most of their revenues in a very short time-frame, often no longer than a month. As you can imagine, that means shipping a lot of orders in a short amount of time!
This would be stressful under normal circumstances, but as you are likely aware, 2020 is not normal. Indeed, the coronavirus pandemic has led to an unprecedented growth in eCommerce. At the same time, the economy is bad shape and people are stuck in their homes. Companies are reputable as Amazon are having a hard time keeping up with demand…and the holidays are still months away.
And, yes, we’re well aware that this post is coming out early. It’s a hot, sticky August morning where I’m writing this right now. Yet we think it’s important to talk about this now so that you are well-prepared in advance. For all the difficulty this holiday season may bring, it’s also bringing a lot of opportunity for businesses that can handle it.
Holiday Shipping in 2020 Will Be Strange
Even during a normal year, holiday shipping can be incredibly stressful for eCommerce businesses. It’s not unusual for companies to make the bulk of their sales between Black Friday and Christmas. As you can imagine, that puts an abnormal strain a companies every single year to do a lot of shipping in a little time.
Rest assured – this year, people will still be buying gifts. Even though unemployment is high and the economy is considered by many to be in a recession, the majority of people are still employed. Gift-giving as a tradition will continue.
However, beyond that, there are a lot unknowns. Will it be super busy like the massive growth in eCommerce we saw earlier this year? Will people spend less on gifts because they have less discretionary income?
It’s hard to say. We honestly have no idea how Q4 is going to go. All we can do is map out potential scenarios and try to prepare for as many outcomes as possible.
Our industry peer, Rakuten Super Logistics, emphasizes that companies should have two goals for this holiday shipping: promptness and user awareness. That is to say, companies should ship orders on time and be aware that their buyers are going through tough times.
We agree with those goals but want to take them a step further. As other companies struggle to ship orders on time, you will have a tremendous opportunity. If you can provide great service during the holidays this year, you are likely to gain market share and retain customers. In other words, this is a massive growth opportunity.
Basic Rules for eCommerce Holiday Shipping
Even under the unusual circumstances that 2020 has thrown at us, the basic rules of eCommerce holiday shipping remain unchanged. In fact, if you followed these rules to the letter and did nothing else differently, you would probably be okay.
1. Know the holiday shipping deadlines.
Every year, major carriers, including UPS, FedEx, DHL, and USPS post lists of holiday shipping deadlines. They tend to come out in October. Set up a Google alert so you can be notified as soon as this information is available.
2. Review your entire supply chain.
You can read more about supply chain management in this post. To make a long story short, you want to think about the entire process from procuring raw materials for manufacturing to delivering items to your customers. If there are any weak points, you want to find them and fix them.
3. Identify customer pain points.
Around half of online customers during the 2016 holiday season had a bad shopping experience. You don’t want people to say that about your business. Think ahead about the kind of problems that might show up and annoy your customers. Plan early.
4. Identify your business’s pain points.
Don’t just think about your supply chain. Think about marketing, accounting, and every other department of your business. Figure out who needs extra resources and make sure they have them before they need them so you can face the holidays.
5. Map out your returns process.
It’s really easy to forget about this, but it’s so important. Returns are extremely common and you need to have a good plan to handle them.
6. Double down on marketing.
If you plan on making the bulk of your sales during the holiday season, you need to make sure you increase your marketing spending accordingly. On top of that, recessions are a great time to gain market share while your competitors cut their ad spending.
7. Plan for gift shipping.
To quote our original post: “this will seem incredibly obvious when spelled out, but many eCommerce store owners never think of it. Because you are selling products that will wind up as gifts, one value-added service you can sell is gift wrapping. Come up with a plan for shipping gifts!”
8. Consider creating custom holiday packaging.
Fancy custom packaging can increase customer retention rate. It also makes people feel like they got a better product for the same price. The holidays are the perfect excuse to experiment with custom packaging!
9. Think about the unboxing experience.
People will most likely be opening your gifts on the holidays, quite possibly in front of others. Make sure your product looks great when it comes out of the packaging!
10. Estimate your order volume.
We’ve written about how to estimate demand before. We know how incredibly hard it will be to do that during this unprecedented season, but you still need to try. A decent guess of how many packages you’ll be shipping will help you decide how many supplies you need to keep on hand and how many workers you need to keep on staff.
11. Stock up on critical supplies.
Think back to March of this year. Remember how everybody panicked and bought groceries and toilet paper? The people who were already stocked up didn’t have to deal with any of that.
You should think the same way about boxes, bubble wrap, packing tape, and anything else that your business needs to ship for the holidays.
12. Hire seasonal workers if you need them.
Pretty self-explanatory – if you have items to ship, make sure you have enough people to ship them. Alternatively, you can also outsource fulfillment to a third party.
13. Automate and outsource before you need to.
If there is anything in your business that’s inefficient or expensive, now is the time to automate it outsource it. Instead of tracking customers by hand, get Salesforce and learn it before the holidays arrive. Accounting? Consider Quickbooks.
You want to give yourself as much slack as possible before the holidays begin.
14. Check your timetables.
When arranging large freight shipments, it can be tough to keep track of what items will be in which warehouses and when. Because of this, double-check, triple-check, quadruple-check all your freight shipment timetables. The last thing you want on December 25 is a cargo vessel sitting in a port off the coast of Florida when you expected it to come ashore two weeks ago.
Additionally, make sure your warehouses will receive goods in time to get packages out in the mail before the holiday shipping cutoff dates. Otherwise, you’ll risk unhappy buyers who expected their items to arrive before Christmas.
If everything doesn’t line up, it’s better to catch that now! It gives you a chance to set expectations which can do wonders for your business’s reputation in the long-run.
15. Take notes so you can improve next year.
The holidays show you how your business operates under stress. Pay attention to what happens. You can take the lessons you learn and create a better, stronger business when you have slack time again next year.
Holiday Shipping in 2020 Will Be Harder – Here’s Why
With the above rules in mind, you also need to take into account that 2020 is no normal year. In fact, we think that shipping in 2020 will be harder for five specific reasons:
- Shipping will be slower than usual. Both warehouses and postal carriers will be dealing with an unusually high volume of orders due to the rapid growth of eCommerce. Additionally, warehouses and postal carriers are dealing with health and safety rules like social distancing. While this is very important to public health, it’s not convenient.
Our advice? Pad your timelines, expect the unexpected, and set reasonable expectations for your customers.
- Some items are going to be unusually popular. Ever since the coronavirus pandemic began, some items were inexplicably popular. Similar patterns of behavior may occur this holiday season.
How do you address something like this? Pay attention to your customers’ behavior and try to find underlying trends.
- The virus is likely to spread. Between holiday shopping, family gatherings, and religious services, the coronavirus will have lots of opportunities to spread. This could lead not only to the worsening of public health, but also to the reinstatement of stay-at-home orders. (We really hope we’re wrong here.)
Plan on the coronavirus spreading further. Again: pad your timelines, expect the unexpected, and set reasonable expectations for your customers.
- Lean supply chains are likely to break. If you rely one material supplier overseas, one specific factory, and one specific carrier, you could run into unexpected delays.
The upshot is simple: if you depend on other companies to create your product, then find backup manufacturers and suppliers if you can.
- The USPS is having trouble. The USPS has recently experienced a lot of turmoil. Some people say it’s the result of budget cuts and others say it’s the result of political malfeasance. No matter what, though, the takeaway for you is simple: if you rely on the USPS, make sure you’re ready to switch to a private postal carrier if worse comes to worse.
This holiday shipping season is bound to be a strange one. Not only will there be a lot of orders, but there are a lot of things that could go wrong that wouldn’t under normal circumstances.
However, there is a major silver lining. If you are proactive about preparing for the holidays, you can avoid the worst of the problems. Then you will be able to deliver items to your customers on-time and make a lot of money doing so!