WASHINGTON, D.C. Aug. 25, 2022 — If you’re not planning for peak season right now, you’re already behind. It may be summer outside, but the chill of winter and the heat of an on-fire holiday season is already upon us.
These are among the observations from Millie Tarallo, Chief Revenue Officer at Dropoff as she looks towards what could become, given recent industry trends, the highest volume holiday season to date. “We have ecommerce and retailers inquiring with Dropoff about adding same-day courier services to their shipping suite as they look for ways to diversify and meet increasing demands,” she says. Bringing over twelve years of field, transportation, and logistics experience to new her role at Dropoff, Tarallo has managed these holiday peaks before. “It’s very telling when companies shift away from traditional carriers to seek new opportunities for capacity.”
Dropoff is a tech-enabled, same-day, last-mile delivery platform based in Austin, TX that has been providing businesses nationwide with 24/7 logistics support since 2014. The company, just recently named one of Inc. Magazine’s fastest growing private companies for its fourth consecutive year, is an active member of the Customized Logistics & Delivery Association (CLDA).
It’s more than the anticipation of the growth in ecommerce and the current labor shortage that’s causing these shippers to expect carriers to get an early start on the season, “These shippers are looking at their logistics and wondering if their current network has the capacity and how they can both increase their market share while identifying alternative shipping channels with that capacity,” says Tarallo. “Many expect to bring on new providers. That takes time. There’s a lot of technology integration needed to get out the kinks in a new relationship with a carrier. If you haven’t done that by September, you’re going to be far behind and your service is going to suffer. We advise all new customers we’re speaking with to complete integrations early; test data and delivery service levels way before peak season.”
Shippers looking for capacity, Tarallo suggests, “Should think about differentiating their offerings with same-day service. Speed of shipping is a critical decision point for buyers and you may gain incremental sales while finding new capacity for shipping.”
How to Manage Capacity Challenges
Capacity challenges are part of the business, but Tarallo says this doesn’t mean carriers have to say no to a customer if their capacity demands are too high for them. “If you know in your heart of hearts that you can’t handle all the deliveries they expect to give you, you don’t have to walk away from the business completely,” Tarallo says.
1. Be Honest About What You Can Manage
“There are several alternatives. One is to candidly share, ‘This is not a volume I can handle on my own, but what I can do is work with my network of other carriers to meet your needs.’ Another alternative is to carve out the part of the business you can handle and meet your service levels and be honest with the shipper upfront so they can diversify their network to cover what you can’t handle.”
2. Partner Up
She points out that COVID showed shippers that it’s critical to partner with several carriers. “Since COVID, it’s been about carrier diversity with shippers. Even for those that previously used major carriers. They now recognize the need to diversify in particular markets if they’re going meet customer demands,” Tarallo says.
3. Be Cautious; Be Smart
And just how high does she expect those demands to be for Holidays 2022? “It’s going to be the most challenging season ever,” she says, “because consumers expect to get their orders faster. Faster shipping is often a key decision-maker when it comes to what they will purchase. We know the expectations of consumers are growing and that they are demanding we meet higher expectations. Before COVID we expected to scale to this level of demand in eight years; it’s happened in three.”
Tarallo shares that regional carriers should be cautious about accepting all of this business. “You have to be able to take what you can handle and make a profit on it. There’s a reason that large carriers are being more selective with their customers. Some of those jobs simply aren’t profitable. I’d suggest regional carriers only take the ones that fit their current capabilities; ones where they have a unique capacity.”
The Labor Shortage is Real, Line Up Your People Resources NOW
Tarallo also urges carriers to line up their people resources earlier than they have in the past. “The number one challenge carriers are going to face when coping with the upcoming holiday season is the labor shortage,” she says. While this may be starting to trend in a better direction, here are some ways to ensure you’re ready:
1. Prepare Your Current Workforce
Tarallo suggests preparing your current workforce now for what lies ahead during peak: “We’ve already discussed communication with your customer, but communication with your team is as critical at this time of year. Let them know what you’re doing today to get ready for peak. Prepare them for the fact that they’re going to be working long, hard hours. Think about how you can support them.”
2. Support Your Drivers
There are a lot of sacrifices that drivers make. Consider what you can do for them that’s a little bit extra. Can you have breakfast or lunch for them? Those little things go a long way. Tarallo encourages everyone to, “Do what you can to recognize the efforts that these people are making to help you deliver top-notch service to your customers.”
3. Take Action Against Your Postmortem
She also advises that carriers talk to the people who got them through the peak season once things slow down. “By definition, there will be misses during that hectic time,” she says. “It’s your people out front who have the information that can avoid those misses next time. Capture it right after the season with a holiday postmortem. While things are fresh, ask everyone on your team, ‘What did we miss in the last quarter of this year, and how can we prevent it next year?”
Tarallo summarizes her advice for making it through Holiday Season 2022 this way: “It’s all about preparation. Prepare your customers. Prepare your resources, and then have a plan to make sure all that communication is shored up in both directions.”
Dropoff provides nationwide, same-day custom courier services in the healthcare, retail, and industrial industries. The company’s proprietary logistics platform empowers enterprise businesses to gain full visibility throughout the chain of custody with real-time track and trace and intelligent dispatch. Discover how Dropoff is shaping the future of last-mile delivery by visiting Dropoff.com
About the Customized Logistics and Delivery Association
The Customized Logistics and Delivery Association (CLDA) represents the first to final miles of the supply chain in the US and worldwide. This non-profit professional association serves the needs of its 2,900 essential service members who are logistics professionals, carriers, shippers, drivers, air cargo logistics providers, 3PLs and vendors servicing today’s supply chain companies. The CLDA gives its members access to a diverse network of logistics professionals looking to create new business opportunities and share decades of practical insights. They provide an avenue for amplifying members’ voices on key issues and helps them participate in the regulatory discussions shaping the industry. The CLDA keeps members informed and educated on trends, current issues, and best practices. For more information see clda.org.