A Peek at Peak 2020 and a Plan of Action: Insight from UPS

UPS Longitudes

 

Early sailors guided their ships by the stars. While the North Star blazed in the sky, that navigation worked fine. But once the clouds moved in, reaching safe destinations came down to instinct, experience and expertise.

In 2020, we don’t have the stars to steer by. The COVID-19 clouds moved in fast, and they obscured the view.

As challenging as 2020 has been, we still have significant insights guiding us toward new opportunities.

Here’s some of what we’ve learned in this unprecedented year.  

 

An E-commerce Boom

For consumers and those that depend on them, COVID-19 accelerated an e-commerce surge already dramatically changing retail, especially brick-and-mortar brands.

While we’re seeing creative and positive adaptations in traditional stores, we’re also seeing struggles (by the first week of August, 25 major brands had already declared bankruptcy).

This e-commerce boom may look like a COVID reaction, but it could well turn out to be the new normal. Homebound and some previously difficult-to-reach segments now buy online for the first time.

Shoppers are buying more — and more often. More than ever before, customers enjoy e-commerce’s quality, convenience and security. More stores with their own loyal customers are also moving online, establishing and reinforcing new brand affinities.

With the e-commerce boom, the logistics surrounding available products have become arguably as important as products themselves.

At the onset of the pandemic, authorities confirmed the critical role of logistics when they designated companies like UPS as essential services.

Logistics networks deliver food, medicine, technology and equipment — and a sense of normalcy in times that are anything but normal.

Pandemic or not, we have a holiday peak season ahead of us. Every business should be thinking now about the uncharted path ahead.

 

Looking at the Holiday Season

Pandemic or not, we have a holiday peak season ahead of us. Every business should be thinking now about the uncharted path ahead.

Holiday peak 2020 considerations include:

1. E-commerce and digital channels will be more important than ever. Many customers won’t risk their health to visit a mall or pick out a holiday ham. Instead, they’re choosing to shop securely from home.

2. The calendar isn’t friendly this year. Christmas Day falls on a Friday. That means no weekend buffer before the big day.

3. The volume of orders this year will really test the capacity of carriers in the final mile of delivery — always the most labor-intensive leg of logistics.

4. Finally, what if there’s a COVID-19 vaccine? It would be a fine holiday gift, of course. But hundreds of millions of doses of a temperature- and time-sensitive vaccine in the supply chain will pose a logistics challenge, especially during the holidays.

We also see a few wild cards that might complicate logistics even more in the peak season:

  • The biggest question is consumer behavior. Will social distancing and shutdowns cause more or less gift giving and shipping?
  • Will the U.S. government send new stimulus checks to Americans? When?
  • Finally, when is the official starting point for holiday purchasing? With physical stores on pause, will we see a traditional Black Friday the day after Thanksgiving? If not, what happens instead?

 

Smart Planning and Foolproof Contingencies

It would be nice for us to have familiar guiding stars these days. Instead, we must rely on smart planning and  smart contingencies: Plan A, then Plan B and so on. If COVID has taught us anything, it’s that flexibility and adaptability are necessary for survival now.

At UPS, we recommend businesses prepare in two ways:

1. Pay scrupulous attention to supply chains, inbound and outbound. Make foolproof arrangements for shipping your goods … and do it early.

2. Find a quality logistics partner. Get together to talk through needs and expectations, and leverage solutions that provide monetary support and accelerate growth like the UPS Customer Technology Program. Plan your work and work your plan with a partner that treats you like its own business.

The COVID cloud hasn’t obscured another crucial insight. UPS logistics planning, connected to your marketing and sales planning, could be critically important this holiday season.

Working together, we can manage slight shifts in capacity demands and find alternative last-mile solutions (like UPS Access Point locations and UPS My Choice). We pinpoint and level demand to optimize product flow, and we can guide you through any unexpected events and disruptions.

While COVID-19 clouds make steering by the stars difficult, these are ideal times to partner and work together to ensure business success.

Let’s candidly discuss challenges, risks and peak approaches. As your partner, UPS will help you find ways to chart a course through the holiday season and beyond — to new opportunities for you and your customers.

 


This article was originally published on September 15, 2020 in UPS Longitudes. 

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