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With a shorter timeframe between Thanksgiving and Christmas, who will thrive? 

The holiday season is fast approaching, and with it comes the annual peak shipping period. However, this year, businesses face an added challenge that could significantly impact their operations and bottom line.

The window between Thanksgiving and Christmas in 2024 is shorter than usual, creating a compressed peak season. There are 17 business days (and 27 calendar days) between the two holidays, which is 3 business days shorter (and 3.5 calendar days shorter) than the average of the past five years.

Here's a breakdown of the peak season length for the past five years:

• 2020: 20 business days (29 calendar days)
• 2021: 21 business days (30 calendar days)
• 2022: 20 business days (31 calendar days)
• 2023: 20 business days (32 calendar days)
• 2024: 17 business days (27 calendar days)

Though three days doesn’t sound like a big deal, those in the supply chain industry understand that this compressed peak season, combined with the ongoing effects of the post-pandemic recovery, labor shortages, potential strikes, natural disasters, carrier volatility, and increased shipping costs due to demand/peak surcharges, presents “just another thing” to prepare for in the upcoming weeks. In the grand scheme of all that, what’s another thing, right?

The good news is that many shippers, from small businesses to large enterprises, tend to prepare for peak season as early as June. However, it’s extremely difficult to prepare for absolutely everything. As businesses strive to meet increased demand in a shorter timeframe, special attention must be paid to the automated shipping process. Adjusting your high-volume parcel shipping operation to meet customer demands requires flexible technology, solid carrier communication, and the ability to do more with the same or less.

The Logistics Challenges of a Shorter Peak Season

Increased Demand, Shorter Timeframe 

The shorter timeframe between Thanksgiving and Christmas this year means that direct-to-consumer (DTC) businesses are facing the typical peak surge in demand with less days to get orders out of distribution locations and onto doorsteps. This can lead to:

• Doing more with less: The holiday season typically sees a surge in demand, especially right after Thanksgiving with events like Black Friday and Cyber Monday. A condensed shopping period means that retailers must fulfill more orders in less time.
• Shipping delay domino effect: While shippers have less days to fulfill, carriers have less days to pick-up and deliver. As carriers struggle to handle this increased volume, shipping delays may become more common, further impacting customer satisfaction.

Peak Season/Demand Surcharges & General Rate Increases (GRIs)

Due to this surge in orders (and to accommodate pain and suffering), carriers often implement demand (previously known as peak season) surcharges to offset the increased costs associated with handling higher volumes during the holiday season. In fact, FedEx and UPS have announced peak surcharges in which customers can expect to face an additional 10% to 20% in fees, not including rising fuel surcharges. Seasonal rate increases like these can significantly impact your bottom line.

These surcharges can:

• Reduce profit margins: The additional costs can eat into businesses' profit margins, making it more difficult to remain competitive.
• Force customers to absorb costs: Businesses may choose to pass on the increased shipping costs to customers, which can lead to reduced sales and customer dissatisfaction.
• Encourage customers to seek alternative carriers: Customers may be more likely to choose alternative carriers that offer lower rates, potentially impacting a business's customer base. But hopefully they’ve onboarded these carriers earlier in the year to prepare.

ALSO don’t forget - UPS's early General Rate Increase (GRI) of 5.9%, starting on December 23, can further exacerbate these challenges for businesses. While the UPS GRI shows a steady bump across ground, air and international services, their area surcharges and ZIP code/zone shuffle is sure to throw high-volume shippers for a loop. Luckily the FedEx GRI won’t take effect until January 6th, 2025.

The ever-so-slight positive side to all of this? A shortened timeframe between holidays could mean less days of demand surcharge dings, right? 😉

[Dive deeper in 2024 shipping surcharges]

Which High-Volume Shippers Will Win?

By automating and optimizing shipping processes, businesses can improve efficiency, reduce costs, and enhance the customer experience. High-volume shippers who have done the following prior to peak season are in a better position to succeed, no matter how many days fall between holidays.

1. Pulled business forward: One of the best strategies we’ve seen includes running fall sales prior to Black Friday and Cyber Monday to pull some of that expected volume forward and open capacity for when it’s crunch time. Do you think both Amazon Prime Day 2.0 and Wayfair Way Days occurring in October were a coincidence?

2. Optimized carrier mix and implemented automatic carrier service selection: During a shorter peak season, these efficiencies are especially critical to ensure timely order fulfillment.

• Carrier “rationalization”: Finding carriers who would accept volume was once hard to come by during the COVID era, but times have changed. Capacity has opened up to shippers, causing volatility in the carrier market where some up-and-comers have been forced to close their doors. Businesses who have “rationalized” their shipping vendors and found the right carrier mix (national, regional, same-day/next-day) that they can turn on and off as needed will be best prepared for shortened fulfillment windows, strikes, surcharges, and any volatility that might come their way.
• Automated carrier selection: Turning on and off carriers and carrier services is one thing. Automatically selecting the best carrier based on factors such as cost, speed, and service level agreements is another. Utilizing technology that can also consider factors such as time-in-transit, customer day/hour of choice, label creation time, last carrier pickup time, contracted pickup dates, contracted transit dates, and contracted delivery dates to select the optimal carrier for each shipment is optimal for parcel volume spikes and meeting delivery demands prior to gift day. [Watch how Advanced Date Shopping works].

3. Increased distribution locations: High-volume shippers who’ve added distribution hubs, such as additional distribution centers, ship-from-store locations, or drop-ship vendors, have put in place a solid omnichannel distribution strategy that brings their product(s) closer to their consumers, lowering shipping costs drastically. What’s even better is if they’re able to manage these locations themselves by turning shipping functionality on and off according to shifts in demand.

[Learn More: ProShip Parcel Config App]

4. Enhanced the customer experience (CX) with increased communication: During a peak season – especially one as short as this – excellent customer service is more important than ever to retain customers and build loyalty.

• Real-time shipment tracking: Providing customers with real-time updates on their orders improves visibility, thus improving satisfaction. [Learn more about ProShip’s Shipment and Tracking Solutions].
• Proactive notifications: Sending automated notifications to customers about shipment status, expected delivery dates, and any potential delays is much appreciated by customers, especially those last-minute shoppers (you know who you are).
• Returns management: What’s a good holiday season without returning something you hate? Peak season doesn’t just end on the 25th. According to the National Retail Federation (NRF), 15.4% of all holiday purchases were returned after the 2023 peak shopping season. Want to stand out? Streamlining the returns process and giving easy-to-follow return options to your consumers improves customer satisfaction and reduces costs.

The Power of Flexibility in Your ESS

The high-volume shippers who are positioned for a successful peak season, no matter how many days fall in-between holidays, are the ones who’ve prioritized their automated shipping processes. Often times, this goes hand-in-hand with putting the right tech into place within their Enterprise Software Stack (ESS).

Selecting a choice-empowered shipping platform that integrates seamlessly into your current ESS can provide the tools you need to optimize your shipping operations, reduce costs, and enhance customer satisfaction during peak season and beyond.

A flexible multi-carrier shipping software should offer you choices surrounding:

• Carrier agnosticism: Find a platform that supports a wide range of both on-platform and API carriers, giving you the flexibility to choose the best options for your shipments.
• Deployment: Want a privately hosted cloud deployment? Need the speed and security of an on-platform deployment? Maybe a little of both, just in case? Find something that offers either, both, and hybrid solutions.
• Business rules engine: Customize your shipping processes with a powerful business rules engine, enabling you to automate complex workflows and enforce specific requirements, essentially allowing you to ship how you want to ship.
• Rate Shopping: You should be able to rate front-of-line or end-of-line. Make sure you can do both to save the most on shipping costs.
  • How Rating Shipments Upstream Can Improve Your Parcel Operations
  • Real-Time Rate Shopping at the Packing Station
• Scalability: The right platform should be designed to scale with your business, accommodating growth (like adding those shipping locations when needed) and increased shipping volumes.
• Support and expertise: You should benefit from a team of in-house experts who can provide guidance, support, and training to help you get the most out of your shipping system.

Looking Ahead

The peak season presents a unique set of challenges for businesses, including a shorter timeframe, supply chain disruptions, labor shortages, and increased shipping costs. By leveraging the power of robust shipping software like ProShip, businesses can navigate these challenges more effectively.

In addition to these benefits, ProShip is proud to offer the ProShip Report. This comprehensive industry report features data from over 200+ high-volume parcel shippers (including ProShip’s own customer base), providing valuable insights into fulfillment trends, technology adoption, and delivery service preferences for 2024. The report also highlights key challenges and opportunities that businesses can expect to face in the coming year.

Don't let the challenges of the peak season hold your business back. Schedule a discovery call with ProShip today to learn more about our solutions and how we can help you optimize your shipping operations.

Not ready to schedule a call? Join us for our upcoming ProS Who Know Shipper Only webinar to get a no-pressure look at the ProShip platform and have your burning questions answered live!

Have a happy peak season!!