Heeding the Call of Shippers: What 3PLs must know to survive the e-commerce revolution

A happy couple is about to move into their first house. All the furniture, clothes and kitchenware items have been sent to the new residence, but there is one crucial, final element still missing: The king-size brass bed that has been ordered through Macy’s and is set to arrive on Friday, just before move-in day.

As the couple packs up and checks their phones every five minutes for news about the bed, they begin to get nervous when 5 p.m. rolls around and still there is no sign of it. They call Macy’s, which tells them the bed was scheduled to be picked up from the distribution center by noon, but they have heard nothing from the logistics company in charge of the final-mile delivery.

After some digging, it turns out there was a delay on shipping the bed to the warehouse, but Macy’s was never alerted. In the end, the couple has to wait until Monday to get a decent night’s sleep in their new house, and one of them needs to take another day off work to accept the Monday shipment. On Saturday night, as they grumpily dig into the box where they packed their camping air mattress, one of them grumbles to the other, “Well, that’s the last time I order from Macy’s!”

That final outcome is the crux of much of the tension between shippers and forwarders in these days of e-commerce expectations, said Tony Sciarrotta, chair of the Reverse Logistics Association (RLA). In the above scenario, Macy’s did nothing wrong, yet it was being blamed because the forwarder didn’t provide transparency or a contingency plan. “It’s always the retailer that gets the blame for bad service,” he said.

Sciarrotta, whose RLA organization represents a wide range of retail shippers, from Amazon to Walmart, said the two most important factors to retail shippers are speed and accuracy. While few transport modes can come close to airfreight in terms of speed, the need for accuracy, he said, is not being met by today’s airfreight forwarders and carriers, leading to a sharp rise in the rate of product returns, especially in e-commerce. “I would say e-commerce returns are two to four times the rate of products sold at brick-and-mortar stores,” he said.