According to Logistics Management, more parcel carriers are moving heavier parcel shipments to less-than-truckload freight in e-commerce because they’re overwhelmed. This creates a wonderful opportunity for shippers to eliminate the middleman costs by considering the use of less-than-truckload freight options for e-commerce. Those that seek to succeed in shipping online need to know a few things about why less-than-truckload may be the solution, how customers’ expectations are increasing, and what benefits less-than-truckload offers.
Customers’ Expectations Are Increasing
The value of today’s consumers is measured in how well companies can meet customers’ needs and offer something their competitors do not. Last year, Amazon’s purchase of Whole Foods radically changed how Amazon’s customers viewed the world, and what was once considered unusual has become a standard part of the e-commerce customer’s shopping journey. Simultaneously, customers are growing to expect the same Amazonian delivery schedules from their favored retailers. Next-day and same-day delivery are standard, and retailers that cannot meet such delivery needs will see more customers abandon ship in favor of Amazon and those that do offer faster, cheaper shipping.
According to Emma James of Inbound Logistics, e-commerce sales for the second quarter of 2017 exceeded $111 billion in the U.S. This means consumers are turning to e-commerce for more products than ever before, and if the trend continues, the age-old statistic of e-commerce making up a mere 10 percent of U.S. retail sales could easily trend upward to 20 percent or more. Paired with increased customer demand, this creates a perfect storm for shippers, threatening to undermine the most effective e-commerce strategies and requiring more than just parcel shipping management.
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Why Are Shippers Looking to Less-Than-Truckload Freight in E-Commerce?
Although an effective parcel management solution is critical to the success of e-commerce, it may not be appropriate for all e-commerce shipments. Since e-commerce exists around the globe, variety in shipping can amount to better cost management and fewer delays. Meanwhile, shippers must look beyond parcel shipping to less-than-truckload freight in e-commerce due to several driving forces. According to Freight-Specialist.com, these forces include:
- E-commerce demands higher inventory variety.
- E-commerce sites have galvanized a new generation of small entrepreneurs and shippers.
- Small and mid-sized businesses (SMBs) are using freight brokers and 3PLs more often.
The Benefits of Shipping Less-Than-Truckload Freight and Parcels in E-Commerce
Less-than-truckload freight in e-commerce is one of several ways shippers can leverage existing supply chain resources to meet customers’ increasing demands and stay competitive. On a surficial level, using less-than-truckload freight options, such as freight consolidation, can immediately lower e-commerce shipping costs for companies that need to move multiple shipments long distances. While more companies seek to move distribution centers and areas closer to consumers, less-than-truckload will become the standard process for meeting demands until all consumers live within 100 miles of a retailer’s distribution centers. Of course, the variety of e-commerce sales and products makes this impractical scenario even more far-fetched. Therefore, shippers will continue to turn to less-than-truckload freight in e-commerce for its benefits. As explained by James, the benefits of using less-than-truckload and parcel freight management in e-commerce via a connected e-commerce platform include:
- Manage Both LTL and Parcel Costs in One Place. An integrated less-than-truckload freight in e-commerce platform with existing e-commerce shopping carts, like the e-commerce platform now offered by Cerasis, will allow shippers to streamline management of all less-than-truckload and other modes of transportation.
- Compare Carrier Rates for LTL Versus Parcels. Comparison of freight costs for multiple carriers is key to managing freight spend and selecting less-than-truckload versus parcel shipping options. Giving customers additional shipping options for delivery, which may come at premium pricing, will also help shippers compare these costs in real time.
- Apply Standard Shipping and Handling Costs to Freight Quotes. All freight needs accurate shipping and handling costs considered before making a decision. Integrating e-commerce platforms that can calculate the less-than-truckload and parcel shipping costs immediately makes this possible.
- Measure Performance, and Continuously Improve. Shippers will need to continuously improve performance, and advanced reporting and business intelligence tools within e-commerce shipping platforms will help shippers aim for this goal.
- Better Variety of Local, Regional, and National Carriers. One of the final benefits of using both less-than-truckload and parcel freight options for e-commerce is simple; shippers that leverage local, regional and national carriers can ensure freight spend is minimal and guarantee faster, more cost-effective shipping for e-commerce consumers.
Putting It All Together
Although less-than-truckload shipping is not a new concept in e-commerce, shippers may forgo its benefits in favor of a parcel-exclusive shipping strategy. Unfortunately, focusing solely on parcels will result in added expenses and reduce the overall efficiency and cost-effectiveness of e-commerce sales. Shippers that do look beyond parcels can leverage less-than-truckload freight in e-commerce shipping to streamline operations, reduce spend, manage intermodal shipments and meet the increasing expectations of consumers. So, the question remains, “what’s keeping you from seeing what less-than-truckload could do for your e-commerce needs?” Find out by reviewing the Cerasis LTL e-commerce solutions online today.