Key questions to ask a potential parcel provider

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Image of a busy warehouseParcel Provider Questions, where do we start? The growth in e-commerce sales and omni-channel distribution has forced more shippers to re-evaluate the way they handle parcel shipments.  The parcel handling section of the chain has become an essential customer-facing activity – for many companies, it’s the only direct contact they’ll have with customers at all, with the purchase journey taking place entirely online. And with the Amazon effect in full swing, end users are expecting more same-day and next-day shipments than ever before. Parcel providers are expected to do more than ever before, at greater volumes. As a result, the need to speed up and streamline the parcel shipping process while maintaining or even reducing costs is both prevalent and growing.

Fortunately, the technology supporting the parcel delivery process is also developing at pace. Cloud-based tools which speed up or completely automate the admin stage of the parcel process are coming into common usage. These innovations are freeing up time for service providers to focus on customer service and enabling them to gain new insights into all stages of the supply chain.

As a result, companies looking to partner with a parcel carrier ought to determine whether they are up to date with the latest technology, and whether they will be able to provide a sufficiently high-capacity service to match customer demands.

The challenge is that most parcel projects are focused on one of two areas: improving pack-and-ship or distribution center pick processes, or automating the final steps in a manufacturing line to move the finished goods to the consumer. With that in mind, typical questions have generally included, “Can you support my carrier? Can you produce my label during the processing stage? Can you integrate into our existing technology systems?”

But topics like future market expansion, growth in volume or diversification are rarely mentioned because both the company and the software vendor are looking to cure only the immediate problem. As the market moves ever further towards a customer-centric model, where a more informed and connected consumer base wants more from the supply chain, parcel carriers need to be prepared for a more automated, high-volume business model.

The sheer complexity of the parcel mode can inject additional complications into the solution selection process. Most carriers, for example, have a predefined set of rules and regulations that they use when working with shippers. Those rules change from carrier to carrier—a reality that can trip up solution providers whose products don’t support such variety.

If logistics managers don’t dig deep and peel back that onion a bit, they may find out two to three years into the relationship that the software vendor can’t support their needs. Where a lot of vendors may claim to ‘support’ parcel, do they also support outbound, inbound, drop-shipping and zone-skipping? Those are the questions that organisations should be asking up front.

At the heart of any good parcel strategy is a high-capacity supply chain management platform. Carriers need to be able to monitor all their shipments no matter where they are in the chain. The ability to centralise order data to ensure they have a comprehensive view over their workload will be critical, as is the capability to provide customers with automated, real-time updates.

Without a robust cloud-based platform in place, carriers risk being left behind by more advanced competitors. Therefore, when selecting a parcel provider, it’s important to make sure they can provide the service level today’s consumers demand.

Sian Hopwood, SVP B2B, BluJay Solutions

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