The peak sales season isn’t going anywhere – it’s just changing rapidly, which has big implications for freight movers, according to market forecasters.
As reported by Fleet owner, consulting firm Deloitte LLC’s predicts a uptick in holiday sales this year, but a significant portion of that is expected to be conducted online via e-commerce, which could further complicate supply chains.
The firm expects retail and distribution holiday sales in the U.S. to climb as much as $986 billion – a 4% to 4.5% increase in November through January holiday sales, excluding motor vehicles and gasoline, compared to the same period last year.
However, Deloitte is also forecasting a 14% increase in “non-store” sales via online and mail order channels during the 2014 holiday season – with “digital interactions” by consumers via smartphones, computers, tablets, and other devices expected to influence 50% or $345 billion of retail stores sales.
“Our research indicates that 84% of shoppers use digital tools before and during their trip to a store,” said Alison Paul, vice chairman of Deloitte LLP and the firm’s retail and distribution sector leader. “Additionally, those shoppers convert, or make a purchase, at a 40% higher rate than those who do not use such devices during their shopping journey.”
Yet that “digital shift” could also complicate freight transportation efforts to a high degree this holiday season, cautioned Robert Nathan, CEO of third party logistics firm Load Delivered.
If last year’s e-commerce impact on holiday freight was a “strong current,” he told Fleet Owner, than this year it’s going to be a “Tsunami – a tidal wave that’s going to create big challenges in the supply chain” and could overwhelm freight carriers already experiencing a shortage of capacity.
“I believe shippers and carriers alike need to hedge themselves better,” he stressed. “The supply chain is so complex now that transportation planning works best by ‘hyper-specialization’ in particular modes and markets. I
Nathan predicts the holiday surge will generate what he describes as an “unprecedented acceleration” in demand for time sensitive and perishable temperature-controlled shipments in comparison to previous years, as well as for “reverse logistics” services.
He cited the “massive amount of e-commerce returns – how to sort, re-pack and re-sequence goods “ part of the “surge in volume due to gift returns after the holiday season.”
Nathan says his company is preparing by using more focused data generated by technology to better navigate the freight demands generated by e-commerce.