Prep for the peak season in 2022

By Oleg Mikhailenko
Published in Solutions
August 22, 2022
4 min read
Prep for the peak season in 2022

It’s already the end of August, which means it’s time for clever merchants to start thinking about how to handle the influx of shipping requests the peak season will entail. Although it may still feel a bit early to think about the holiday season given we still have a couple of months, waiting until October to square away all these concerns will leave you stranded in the rush, competing with hundreds of other merchants trying to arrange the same services at the same time. We here at P2Pseller have a vested interest in making sure you can stay ahead of the game.

Why is shipping so important that it needs to be considered so early? Here’s the real scoop. In the most recent State of Shipping report, shipping was mentioned in almost a quarter of the answers to the question “What keeps you up at night when it comes to readying your business for the 2021 holiday season?”. You might think to yourself that last year’s concerns don’t necessarily apply to this year as well, but in the 2022 surveys almost a quarter of merchants were unsure whether courier services and 3PL partners would be able to keep up with holiday rush demand, in comparison to under one in five the year before. Sellers have been distrustful of global supply lines for the past couple of years now, largely in response to the Covid-19 pandemic, and peak season is sure to add fuel to the fire. Read on for the things you should keep in mind in anticipation of this busy time of year.

Estimate order volume with demand forecasting

Inventory planning, or forecasting, is the practice of using predictive analysis of historical sales data to estimate and make educated guesses about future customer demand for a product or service. It’s about far more than Googling how to manage inventory in Excel. This enables businesses to make better decisions regarding supply and the amount of inventory to keep on hand. It’s by no means an exact science, and will almost certainly never be 100% accurate. Because of the number of factors that can affect a customer’s willingness and ability to purchase a given product over time, the actual mechanics and techniques involved in demand forecasting can be quite difficult. It’s for this reason that many businesses use some sort of software or artificial intelligence to make the calculations on their behalf and track matters such as seasonality.

What’s seasonality, you may ask? Seasonality refers to changes in order volume throughout a set time. Seasonal products usually spike in order quantity at specific times of year (think about all the purchases made for trees, ornaments, and gift wrap in December!) but remain relatively low for the remainder of the time. That’s not to say, however, that you’ll only have to deal with seasonality if you’re selling items such as skis or bathing suits. Demand for all products waxes and wanes with the year. The holiday rush is one such example.

Mitigate increased shipping rates

It’s no secret that inflation is at an all-time high. Due to the Covid-19 pandemic, the war in Ukraine, and the degradation of the global supply chain, prices have shot up at record rates for services in all stages of the fulfillment process. And even before these simultaneous disasters, shipping rates were already steadily increasing. Which is cheaper, FedEx or UPS? Is UPS cheaper than USPS? With some slight variations between one service or another, the three major courier companies are fairly even in price. Depending on the day, a customer off the street might walk into a storefront of any of the three brands and walk out with a pretty decent deal.

Sellers like you, on the other hand, have an additional trick up their sleeve. If you move a certain amount of product, you may be able to qualify for a special discount by signing a shipping contract with one of the big three. This means that in exchange for routing your business through your preferred carrier, you get a few percent knocked off the price. This can seriously add up over time, and as you grow, you have even more leverage to renegotiate. What’s more, we here at P2Pseller allow our merchants to purchase courier services through our own accounts, netting you a larger discount than you might be able to get on your own.

Minimize shipping zones

The jury is in- an inefficient choice of 3PL provider can lead to hundreds of thousands of dollars in additional costs tacked onto your bottom line, leading to a situation where your business can struggle to scale. In this post-Amazon world where speedy, cost-effective shipping is not only a nice-to-have but rather the expected norm, long shipping distances not only translate to delays, but to extra costs.

Reducing shipping zones isn’t as difficult a task as you might expect. First of all, if you’re handling everything yourself through the in-house fulfillment model, you can already get more people on the ground by outsourcing your fulfillment operations. Although you maximize control by picking, packing, and shipping everything, boxes can quickly overwhelm your living quarters and have you struggling to keep up. What’s more, unless you live in an extremely central and well-connected locale, you’re far more likely to encounter situations where you have no choice but to ship to the costly and far-flung zones 6-8. The simple act of reaching out to a 3PL can go a long way towards reducing these unnecessary costs.

In conclusion

P2Pseller is dedicated to helping you jump these shipping hurdles as we draw nearer to the holiday season. Our unique and thorough algorithm helps you choose the absolute best fulfillment partner for last-mile deliveries and for fulfillment in general, making sure you choose a company that has the chops to help you avoid those costly zone 6-8 deliveries. We require our warehousing partners to provide the locations of all their facilities so you can make sure to choose businesses with central, well-connected locations. What’s more, our inventory tracking and demand forecasting software will help you make the smartest decisions possible right from the start. Register a free account with us today on our website or app to see exactly what we can do for you and the efficiency and long-term health of your ecommerce business, one optimization at a time.


Tags

#holiday#peakseason#seasonaldemand#demandforecasting#shipping
Previous Article
Business basics: Shipping insurance

Oleg Mikhailenko

Co-Founder, CEO P2Pseller

Related Posts

Packing slips and shipping labels: what’s the difference?
September 19, 2022
3 min
P2PSeller Logo
LinkedinTwitter
© 2022, Modern Trading Technologies, Inc. USA, California. All Rights Reserved.