The Good News and Bad News for Ecommerce Shipping

Ecommerce sales are up, and shipping providers such as USPS, UPS, and FedEx have responded very well to require in the face of coronavirus-induced shutdowns and limitations.

That is the bright side of e-commerce sellers. For many organizations, orders are strong, and delivery services remain reliable. Unfortunately, supply chains (worldwide and domestic) have suffered, making it challenging for some e-commerce services to keep stock levels and make the most of the new demand. That is the problem.

Fortunately

“From the viewpoint of merchants, we’ve seen a big spike in total volume,” said Mario Paganini, head of marketing for Shippo, a company that makes shipping combination software.

“E-commerce is an uncommon brilliant area amidst challenging financial times. We’re seeing more typically offline organizations moving online along with increased order volume from existing e-commerce services,” Paganini stated.

The current spike in e-commerce orders is well documented. For instance, on May 6, 2020, BigCommerce reported that “almost two million e-commerce deals were made through” its e-commerce platform the prior week. That is “32 percent more than Cyber 5 week 2019”– Thanksgiving, Black Friday, Cyber Saturday, Cyber Sunday, and Cyber Monday. It was the 5th successive week that transactions on the BigCommerce platform exceeded the peak of 2015’s Christmas shopping season.

This is particularly telling due to the fact that unlike reports about how sales have soared for Amazon, Walmart, and other retail leviathans, a number of BigCommerce’s customers fall under the small-and-midsized business category. Therefore, a considerable boost in transactions on the platform bodes well for SMB e-commerce.

More evidence originated from Shippo.

“To put this into point of view, in April 2020, the very first full month where practically the whole nation was under shelter in place, we saw an 80-percent boost in overall orders and deliveries throughout Shippo’s network of merchants,” said Paganini.

The leading domestic carriers in the United States have risen to the obstacle.

“To their credit, USPS, UPS, and FedEx have all stayed extremely reliable for domestic shipments in the middle of Covid-19,” Paganini stated. “Regardless of the well-reported shipment delays for Amazon Prime, we haven’t seen much to indicate destruction in speed or service from the real shipping providers.”

Carriers such as UPS have likewise assisted battle Covid-19.

“To put it simply, a shipment estimated at a two-day arrival pre-Covid-19 is still showing up in two days throughout Covid-19. Even after announcing potentially extended shipment windows for domestic shipments a number of weeks back, our information indicates that USPS delivery times for their leading plan services remain near to pre-Covid-19 averages. There have also been minor protocol changes to adapt to Covid-19, like waiving signature requirements. But total domestic shipping remains strong,” Paganini said.

The Bad News

International shipping, however, has not been as consistent. And possibly more importantly for numerous organizations, business shipping– how business frequently gets stock– has ended up being less reliable throughout the pandemic.

“While [an increased variety of orders] suggests more revenue for merchants, it also brings extra obstacles for merchants and satisfaction partners,” Paganini stated.

“We have heard from merchants that staying up to date with inventory has been an obstacle– both not having enough on hand to keep rate with volume and obstacles in accelerating production on their supply chains, which are frequently international, amid Covid-19. In addition, volume boosts, as you might expect, have brought additional strain on fulfillment– the actual choice, pack, and ship,” Paganini continued.

“For context, a lot of our merchants begin preparing mid-year for peak-season volume, holidays. We have seen many merchants hitting and even exceeding their typical Black Friday and Cyber Monday volumes consistently through April, requiring them to adapt rapidly for higher capability.”

In the worst cases, overseas inventory supplies are not showing up in time for some e-commerce sellers to satisfy a need, or the expense of shipping has significantly increased.

“The expense of moving that freight is nearly going up day by day,” said Paul Golland, owner of PG Logistics, a freight-forwarding business in Australia, according to a May 5, 2020, Wall Street Journal post. “You utilized to get a quote valid for 1 month. Now you’re getting it valid for 24 hours since tomorrow the situation might change once again.”

Impacting Ecommerce

“While specifics differ throughout merchants and industries, overall e-commerce is seeing more purchases and more overall purchasers than ever amid Covid-19. For us, the big concern is, what will things look like when we ultimately go back to normal?” said Shippo’s Paganini.

“Today, we’re seeing buyers that previously did not purchase online making buy from e-commerce merchants out of need. Additionally, buyers who were currently knowledgeable about e-commerce are buying more than in the past.

“This presents an interesting obstacle and opportunity for e-commerce merchants: How do they keep these consumers when we return to typical? For us, it’s more vital than ever for merchants to deliver stellar client experiences, including fantastic support and communications, in-depth order tracking, simple returns, and terrific branded experiences.”