Top 2020 Retail Shipping Trends
At the close of 2019, retail and shipping industry experts looked toward the coming year and made predictions as to the direction of 2020 retail shipping trends. While some of those predictions proved moderately accurate, few could have surmised how rapidly some of those trends would shift or expand thanks to the onset of the COVID-19 pandemic.
In many ways, the pandemic has simply accelerated industry shifts that were already beginning. As we approach the holiday season, here are some of the 2020 retail shipping trends that are likely to continue to gain influence.
Same-Day and Next Day Delivery
Thanks to a precedent set by e-commerce retail giant Amazon’s Prime membership program, next day delivery has become industry standard. While the massive increase in demand for many household staples caused Prime shipping delays during the beginning of the pandemic, causing many consumers to adjust their expectations, the trend toward same-day and next-day delivery options is not likely to go anywhere permanently. Several large retailers, including Target and Best Buy, have added same-day and next-day delivery options to their repertoire in order to stay competitive with Amazon and their massive reach.
While this solution works well for large national and international companies, with locations across regions, it’s a tougher adjustment for smaller companies with fewer brick-and-mortar locations.
Third-Party Logistics (3PLs)
Third-Party Logistics, or 3PL, is just the kind of workaround that smaller-to medium-sized businesses can utilize to allow for shorter shipping windows. These smaller businesses can leverage the network of shipping and fulfillment specialists associated with a 3PL to manage inventories, consolidate shipments, forward freight, and even handle fulfillment, warehousing, and returns. Hiring a group of specialists with an established network speeds up shipping times, and facilitates expertise in the difficult-to-master area of supply chain management.
Companies that contract a 3PL to handle their supply chain are then free to focus on other internal operations, where their attention and skills may be of more value.
Buy Online, Pick-up In-Store (BOPIS)
While retailers have sought to maximize channels for consumers to shop their stores, Buy Online Pick-up In-Store became a burgeoning option that has seen massive growth in popularity thanks to the restrictions put in place by the pandemic. BOPIS allows for consumers to shop regional stores at home, and pick-up their goods either pre-packaged and with minimal in-person interaction, or curbside for even less exposure. This method has increased in popularity significantly, turning many brick-and-mortar stores into miniature fulfillment centers, between catering to BOPIS consumers and ship-from-store as well.
Many industry experts believe that BOPIS will eventually become the default delivery method now that consumers have been exposed to the convenience these retail options offer, and they are unlikely to give them up, even as things return to “normal.”
Another trend that was on the rise prior to the pandemic that has seen additional growth, as a result, is the surge in last-mile deliveries. The last-mile, or final stage in product delivery from local distribution center to consumer, has seen the most rapid growth for some time now, given the surge in consumer expectations for shorter shipping windows. The pandemic, however, which led to shelter-in-place orders and many other restrictions, caused more consumers than ever to begin retail shopping online, particularly in the restaurant and grocery industries.
With so much more local shopping being done online, there will continue to be an even more significant surge in last-mile deliveries.
As we approach a second significant wave of the coronavirus, with likely restrictions to follow, last-mile deliveries will continue to be vital for the delivery of goods and products to those in higher-risk categories who are concerned about the exposure levels of shopping in-person.
Due in large part to the massive volume increase of e-commerce and the pressure demand volumes, in conjunction with regional shutdowns or delays, have put on the supply chain, retailers that may have previously relied on a single carrier are seeking to diversify. Reliance on a single carrier can cause devastating losses of revenue in an already higher-pressure marketplace where restrictions have hurt many.
Having a more diverse network of carriers can relieve some of the pressure, as a partial inventory restock is better than none at all, and can help to maintain business continuity. This trend works hand in hand with the 3PL trend, as 3PL companies have access to a network of carriers, often working with several major lines as well as regional carriers, allowing for a diverse network that can work around border restrictions, supplier issues, and more.
All of the above 2020 retail shipping trends are likely to continue growing in influence as we approach the end of the year. This, along with the earlier advent of the retail holiday shopping season as retailers seek to manage surges in volume, means the changes to the retail shipping industry as a result of 2020 and all of its unforeseen disruptions are likely to continue into the coming years, possibly changing the game permanently. What additional effect the pandemic will have on retail shipping remains to be seen.