How to Improve Supply Chain Resilience: Go Multi-Carrier

In the wake of the Covid-19 outbreak, e-commerce is in the spotlight and improving supply chain resilience is now on C-level agendas across industries.

|Jun 6|magazine12 min read

In the wake of the Covid-19 outbreak, e-commerce is firmly in the spotlight and improving supply

chain resilience is now on C-level agendas across industries worldwide. Whilst many organisations

may have a degree of flexibility built into their supply chains, research from the Institute for Supply

Management in the USA in March found that almost three-quarters of companies reported supply

disruption, and 44% did not have a plan in place to deal with the kind of disruption brought by the

pandemic.

Using a Multi-Carrier Shipping Strategy to Increase Supply Chain Resilience

At a time of significantly increased e-commerce demand, the task of getting products to customers

has never seemed more difficult. Shippers have been forced to look towards new fulfilment

methods to provide the additional capacity and flexibility that’s required to manage the surge in

order volumes and meet on time delivery requirements.  One key consideration: moving to a multi-

carrier distribution strategy to reduce transportation costs, provide a consistent level of service to

customers, and meet their different shipping requirements.

Make Switching between Carriers Easier

The challenge has always been that each carrier insists on applying rigorous, and unique, labelling

and electronic communication requirements in order to move parcels through its network. Shippers

who rely on a specific carrier have to meet its specific requirements or suffer the consequences of

delivery delays, lost packages, or unexpected surcharges and fees. And guess what? Each carrier

wants you to use its own IT software platform to make this compliance possible.

There’s no doubt single-carrier systems are well designed for the carrier they represent, but in order

to adopt a multi-carrier strategy, shippers need to move away from them. Carrier-supplied platforms

make switching between carriers or using multiple carriers difficult or prohibitive— either because

shippers must hit specific contracted volumes with each carrier or because of the unwieldiness of

managing separate systems for different carriers. 

For example, with a carrier-supplied platform, the shippers’ employees need the insight to make the

best choice about how to get an order to a customer.  Comparing rates and routes is labour-

intensive and time-consuming. Also, using carrier-supplied platforms increases the chances of

missing out on the pricing and delivery advantages available with multiple national, regional, and

local carrier services, as well as with national postal services.  Furthermore, when dealing with

different sets of requirements and multiple staff members using separate terminals, it’s easy for

keystroke and human errors to occur, resulting in delivery delays, lost packages, extra costs, or the

inability to use particular services.

Streamlining Shipping Processes and Increasing Resilience with Multi-Carrier Shipping Software

While the end goal of any shipper is to deliver products to customers on time, without damage, at

minimal cost, and in the most efficient manner possible, the recent spike in e-commerce has also

increased customers’ ability to customise their shipping options. For example, one customer may

choose to have their package delivered to his or her home, and another may opt for click and collect.

Multi-carrier shipping software enables the shipper to work with multiple carriers’ labelling and

communications requirements and meet their customers’ delivery demands from within the

shipper’s own system.  The solution automatically determines the carrier that can provide the best

rates to a particular region and according to the shipper’s business rules, ensuring every shipment

complies with each carrier’s requirements, as well as with any applicable trade regulations.

In addition, multi-carrier shipping software enables shippers to easily use “zone skipping” (also

known as “hub induction” or “direct injection”) to improve customer service and cut transportation

costs. Zone skipping occurs when multiple customers’ orders are consolidated for the first leg of the

delivery journey and then inserted into a parcel carrier network for the last-mile delivery. This is

especially beneficial for cross-border shipping because it significantly simplifies end-to-end logistics

and decreases customs clearance costs.  It also provides greater flexibility by allowing shippers to

select local carriers in different countries and regions that have optimal delivery networks for serving

their customers.

Building Resilience to Improve Future Performance

Importantly, a cloud-based multi-carrier shipping system can give shippers the ability to quickly

onboard and optimise new carrier services. This is a gamechanger in a crisis that requires a retail

shipper to suddenly increase capacity, or pivot to a ship-from-store model, for example - or even pull

local courier services into the transportation mix to maintain on-time delivery rates.  It can also

provide the data and analytics necessary to understand where logistics performance is sub-par and

uncover opportunities to increase performance and reduce cost.

Increasing supply chain resilience though multi-carrier shipping solutions gives shippers the ability to

respond to, and recover more quickly from, unforeseen disruptions, and even to grow by optimising

supply chain operations for the long term to increase customer service, market share and financial

performance.