Shipware’s Martinez provides guidance for managing Peak Season surcharges

In light of Peak Season parcel surcharges recently kicking in, based on recent announcements respectively issued by the global parcel duopoly of FedEx and UPS, there is more than enough for shippers to stay on top of and address, at a time when things have remained in a state of ongoing, or perpetual, Peak Season.

As covered previously in this space and in the LM print edition as well, the causes for the sustained Peak Season stem from the ongoing effects of the COVID-19 pandemic, which saw elevated levels of e-commerce activity, with many consumers stuck at home. This activity, in turn, put unprecedented levels of stress on delivery networks that have yet to abate, as we all know.

Needless to say, shippers have, and continue, to feel the heat (no pun intended, as it has been warm lately), when it comes to keeping up with demand and also keeping customers happy, too. These are things that are clearly more easily said than done, at times, to be sure.

Advice for shippers was recently provided to LM by Rob Martinez, president and CEO of San Diego-based Shipware.

As for some approaches shippers can take to ensure that they have capacity lined up for Peak Season, Martinez made the case for shippers needing to work early and often with their carriers to focus on things like: communicating forecasted volumes to ensure asset and network allocation; implementing multiple daily sweeps, including after hours, as well as weekend pick-ups of packages from distribution centers (DC) to leverage two- and three-day carrier networks; working around common network traffic jams through linehaul injection to less constrained carrier hubs; and tying future business to how the carriers prioritize and price the shippers’ business.

And for some other shipper strategies, Martinez pointed to things like balance and better time sales incentives, free shipping and other promotions to avoid excessively high volume peaks; promoting pick-up-from-store campaigns, as well as things like UPS Access Points to avoid residential add-on fees; and exploring partial distribution through large 3PL’s, which are likely to have greater parcel carrier discounts and network capacity commitments.

In regards to Peak Season surcharges, with much of them applying to residential packages, the Shipware executive said that there are options out there for shippers to vet and consider, in the form of the USPS and also postal consolidators, whom he said, have become extremely cost-competitive alternatives to avoid peak residential surcharges.

With things going the way they are, and have been, we remain in interesting and challenging times, when it comes to dealing with rate pressure, as well as other forms of supply chain uncertainty. Even though many of us are now vaccinated and re-entering daily life, the challenges brought on by the pandemic remain and are not leaving anytime too soon. That is why this advice and guidance by Shipware’s Martinez is both needed and appreciated.