Saturday, June 22, 2024
HomeSupply ChainsLogistics and the Supply Chain This Holiday Season: What to Expect

Logistics and the Supply Chain This Holiday Season: What to Expect

With Thanksgiving having come and gone for the year, that can only mean one thing: the holiday season is upon us. Believe it or not, after more than three years of a global pandemic and various disruptions and issues around it, the 2023 holiday season is expected to be the most normal one since 2019. There are several areas in logistics and the supply chain that we at More Than Shipping have been watching to determine what this year’s holiday season will look like for consumers and businesses.

1. Normal Delivery Times for Packages

If you want an item this year to gift to someone, or for yourself, you will likely be able to get it as soon as possible with normal delivery times. This is because several issues have been resolved on the last-mile delivery and warehouse fronts compared to the prior three holiday seasons. First, the truck driver shortage has largely resolved. In fact, there are too many trucking outfits which has recently caused some unexpected bankruptcies as demand was too low for the high supply of trucking options. This means drivers are definitely on hand to make deliveries. Additionally, warehouses are fully staffed, and many employment issues have resolved. In fact, the U.S. currently has a historically-low unemployment rate.

2. Plenty of Inventory Means Gifts are In-Stock

The global supply chain issues that plagued the logistics industry in 2021 and 2022 have largely resolved. Now, shipping containers are much less expensive and shipping goods across the world is much more accessible to a wide range of companies from small to large. As a result, goods are not being held up in key global ports for weeks or even months on end, as was the case the prior two holiday seasons. Chances are, if you order an item as a consumer or as a wholesaler, you will be able to receive that item quickly because it is either a) already in-stock in the U.S. at a warehouse, or b) it can be shipped from overseas quickly as costs have come back down to Earth.

3. For Delivery Companies, Cheaper Costs

Besides very expensive shipping containers, delivery companies and businesses had to face another big hurdle the past two holiday seasons: fuel costs. Now, both diesel costs and gasoline costs have fallen dramatically over the past three months since Labor Day, which is resulting in lower costs and less of the burden having to be passed to consumers, etc. The cost to operate air freight has also decreased, which helps, too.

4. For Consumers, Fewer Price Increases

The word “inflation” became a household word for younger generations following the Covid pandemic. There was a lot of cheap money and low interest rates during the pandemic. As a result, when the economy jumpstarted as things reopened, costs for nearly all goods were higher than in 2019. Now, in 2023, inflation has finally leveled off. While consumers feel the benefit of lower gas prices heading to the store, they also see lower costs in everything from food to gifts to household items.

5. For Shippers, New Ways to Save on Shipping Orders

The major shipping carriers have introduced new shipping options that offer lower-cost shipping to brands looking to ship and deliver goods. For the U.S. Postal Service (USPS), its Ground Advantage service offers a lower-cost option to ship goods over a traditional 7-day delivery window/timeline. UPS has revamped its Ground Saver program, which is a similar delivery window/timeline. These programs allow businesses to pass lower costs to the consumer for shipping, or if providing free shipping, save money on costs themselves.

There will be challenges and some disruptions as there are every holiday season. But, the macroeconomic factors which drove a period of large uncertainty in holiday logistics has largely come to an end, so we can have a joyful and merry season this year. Happy Holidays!


Latest News