It’s the holiday season, and Jack Frost is nipping at the supply chain. But while Santa Claus will somehow deliver toys to every boy and girl, the peak season for shippers also means peak material scarcity, freight prices, port congestion, and labor shortages for supply chain managers.
The annual holiday rush of the holiday season isn’t a new phenomenon. But, as the economic turndown of the last two years continues, this 2021 season will be an unpredictable one for demand forecasting. Of course, we already know the source of this—increased demand combined with decreased supply means scarcity. The pandemic has directly impacted both of these factors.
What factors will impact freight shipping?
Amid shutdowns and high unemployment, consumers did spend during the pandemic. These spikes in demand led to shortages, which increased rates. And even though unemployment is low this quarter, many companies are challenged with temporary employee hiring for increased demand in December. FedEx and UPS peak season surcharges will most likely increase drastically, and consumer demand seems to be as high, if not higher, than ever.
These seasonal changes will impact the transport of goods. For example, if a shipper typically only uses one or two carriers, and suddenly those carriers are at capacity or have a spike in seasonal surcharges, supply chain managers will have the issue of finding enough carriers to move their freight. With more carriers needed and less labor available, shippers may also find it challenging to allocate time or resources for finding the best rates and quality service. As a result, the customer experience will suffer.
So what can supply chain managers do about it?
Prepping for the most uncertain holiday season in recent history involves risk management, and it starts with learning from the ghosts of holiday shipping past. To estimate the volume you will need to manage this season, a historical look at past holiday seasons will help you understand how much capacity will be required. From there, you can combine historical data with all of the other variables impacting the supply chain this year.
Incorporating a robust TMS with supply chain management software is an excellent step to strategizing the best plans to make timely deliveries. CTSI-Global offers advanced reporting with over 60 years of data analytics that help shippers predict the future. Beyond determining the number of carriers needed to ship capacity, it also helps to have access to data that reflects the quality of the carriers you consider.
For example, CTSI-Global’s pre-existing relationships with over 20,000 carriers are included in the Honeybee TMS™, and evaluations of those relationships are continuously updated. Beyond that, the Honeybee multi-carrier shipping application allows clients to seamlessly add new carriers, so that supply chain managers can easily access enough carriers to manage their volume. With this level of flexibility, supply chain managers can quickly compare carriers to ensure that they find the best rates without sacrificing the quality or reliability of delivery.
While it’s safe to assume that supply chain managers should’ve started planning for this season a few months ago, it’s never too early to plan for next year. Of course, all of the supply chain issues happening this year are going to continue to get worse, but with CTSI-Global’s TMS and multi-carrier shipping application, shippers can be more than prepared to manage any challenges that arise in the New Year.
Contact CTSI-Global today to talk about ways to prepare for this winter storm. The services are customizable so that shippers only pay for what they need.