|Ask not what your carriers can do for you…Instead ask: What can you do for your customer? |
By Jeff Lindmark
|By now, you have probably read a story or two about the challenges UPS and FedEx faced with holiday delivery delays. Both carriers were cast the carriers in a negative light due to late deliveries during the holidays. It is easy to get some press with a parent whose son or daughter was faced with a sad Christmas morning due to a late delivery. |
Holiday volume soared this year to unprecedented levels with online consumer sales increasing by almost 21% on "Cyber Monday". Online sales for the final weekend before Christmas were up 37% over the prior year leading UPS to admit that the volume exceeded its capacity while FedEx maintained that in spite of the unprecedented volume demands, very few packages would fail to be delivered on time.
The disappointment was even taken up by US Senator Richard Blumenthal who urged UPS to refund customers whose packages did not arrive on promised delivery dates.
The fact of the matter is that UPS and FedEx both delivered the vast majority of their packages on time and without delays. Those packages, of course, don't make for great headlines this time of year.
So, what is the average company to do with all of these headlines? Every package your company sends says something about your company• the important question is: Do you know what your packages are saying about your company? Therefore, the key may not be the refund you can secure from the carrier for late deliveries; the key is knowing which packages were delivered late and proactively communicating with your customers about the importance of both their business and their satisfaction.
If you are a consumer, you don't care about the fact that on Christmas Eve the U.S. Postal Service delivered 31 million packages, followed by UPS with 26 million packages and FedEx with 13 million packages. As a consumer, you likely only cared about ONE package; the one addressed to you.
Audit companies can secure refunds for those late deliveries. Although the good Senator from Connecticut should understand (respectfully) that unless you ask, UPS won't issue refunds. Nonetheless, even with substantial waivers in place that allow for "late" deliveries during the holidays without financial penalties, audits of UPS and FedEx invoices can result in refunds that are on average 300% higher than the audit results the other 11 months of the year.
However, again with due respect to the Senator, those refunds are not the most important opportunity. The key is to inform supply chain decision making. Business intelligence is crucial to customer satisfaction. This intelligence allows clients to proactively contact customers whose shipments were late. That business intelligence can also be used to build predictive modeling that will allow clients to more adequately plan holiday deliveries for years to come instead of simply inserting tens of thousands of packages into the UPS and FedEx delivery networks and hoping that they arrive on time.
FedEx and UPS took a lot of heat this past holiday, fair or not, the real question that companies need to ask is not what FedEx and UPS are going to do about it• the key question is what are WE going to do about it. Before they ask that question, however, they should remember the business adage: You can't manage what you can't measure. So make sure you have the best measurement tools in place well before the 2014 holiday season.
Jeff Lindmark helped start VeriShip in 2005. VeriShip's proprietary software solution also provides strategic analysis and business intelligence to drive process improvement and cost savings across a client's entire shipping process. Jeff can be reached at Jeff.Lindmark@VeriShip.com or 800.903.3073.