No idea how many of you have been dealing with the whole shipping delay thing this week (self hasn't - for once, 3CM isn't a loser in that way, though he still is in everything else, but he digresses, as usual), but there was a rather choice comment that I heard on NPR's All Things Considered about the problem, which spreads the blame all around. The story quotes Sucharita Mulpuru, an e-commerce analyst at Forrester Research, with a lead up from reporter Dan Bobkoff:
"....Mulpuru....says everyone is to blame for the delays: retailers for pushing last-minute deals and not warning shipping companies; those same delivery companies for not penalizing retailers for doing that; and we, the shoppers.
MULPURU: You order something on Sunday night and expect it to get there on Monday or Tuesday during the busiest timeframe of the year. And to not pay anything extra for it is something that customers really need to have their expectations adjusted."
That's one way to put it. More below the flip.....
Another paraphrase by Bobkoff of Mulpuru goes as follows:
"Mulpuru says that while the percentage of the late gifts each year is fairly consistent, the total amount of online shopping is exploding, so more people are affected. Analysts had expected sales at online stores to increase about 15 percent over last year. But preliminary numbers from NPD Group show blowout with gains more like 24 percent year-over-year."
Put another way, here are some totally made-up numbers to illustrate Mulpuru's point, if only hypothetically. Let's assume that:
a) 5% of on-line merchandise purchases just before Christmas are late.
b) Last year, there were 100 million late-in-the-holiday-game merchandise purchases.
c) This means that last year, 10 million such purchases were late for Christmas.
Let's now assume the NPD group statement of a 24% increase from last year. Thus:
d) This would give 124 million late-in-the-holiday-game merch purchases this year.
e) We keep the same percentage of 5% of those purchases being late this year.
f) This leads to 12.4 million late shipments this year.
Thus in this hypothetical exercise, even if the % of late shipments hasn't changed, the shippers now have 2.4 million more such late shipments than last year, thanks to our increased number of purchases. You get the idea.
On DK, yesterday's OND linked out to a USA Today article on the late-shipping situation, which didn't have any of the analysis from someone like Mulpuru the way the NPR article did (which is why I love NPR for all its faults - too bad they're cutting staff). You can read the FB comments there for insights on both the doofus, more selfish customer side and rebuttal side that might be more from management, except that management scores on this one. On each side, some samples:
Customers:
"Scott Lawrence: UPS needs to hire more employees and be better prepared for another Christmas season."
"Ray Waterman: A customer that pays for a service deserves that service. Service failures are common in transportation. Can't blame the customers, excuses are just that. 'Excuses'"
Management:
"Melanie Affarian Saint-Jean: I have been in the retail arena for 30+ years. Unless the retailers negotiated contracts with the carriers, which they did not (very complicated) then the fault lies on the retailers. It is not UPS's job to "anticipate" what games the retailers will play to increase sales during the holiday season. The retailers did not project well, therefore leaving the carriers to hold the bag. If the retailers wanted to ensure delivery they should have hired independent carriers to deliver local deliveries close to distribution centers. And just an FYI, UPS may have promised 24 hour delivery, that is from the point when they pick it up. Again an FYI, by time the retailer searches for the product, gets it to their distribution center and then contacts UPS, sometimes days can go buy. Things don't magically ship from the shelves!"
There was also a quick rebuttal to Scott Lawrence from one "Stump Junkman": "they would also need more trucks, more handheld computer equipment, ect" [sic]
Back to NPR, there was
this post on the
Planet Money blog that quotes Sucharita Mulpuru more fully:
'"There is this perception that UPS and FedEx, and even the Postal Service, to some degree, they just do what they do magically, and they will always get it done, and they have infinite capacity to handle anything.".....
Mulpuru says lots of retailers promised delivery in time for Christmas in the weeks leading up to the holiday, without communicating those promises to their carriers. That created big problems for shipping companies, which "plan months ahead of time" for the busiest weeks of the year.
But Mulpuru says the carriers may also share some of the blame, for not raising their prices to reflect the increased demand.
"There is an imbalance right now in e-commerce of supply and demand from a carrier standpoint, particularly in the days leading up to Christmas, and there is not a lot of variable pricing," says Mulpuru. "There are not a lot of consequences to retailers when they push these orders to the carriers, there are not financial consequences."'
What would logically follow is that this situation needs to change, namely that carriers need to be able to tell retailers that if they plan to dump extra volume on them, then the retailers have to be willing to pony up extra $$ for extra capacity by the carriers to handle that:
'While this problem of delayed deliveries during the holidays isn't new, Mulpuru says she thinks the steady growth of the e-commerce industry may mean this year is a "wake-up call" for both retailers and carriers.
"You are going to see significant changes to [shipping] pricing probably," says Mulpuru. "What that is going to ultimately mean is that retailers are going to have to think more carefully about when promotions go out and when they themselves are pushing their customers to shop."'
One might be cynical enough to think that retailers won't think like that, much in the same manner that customers don't either when tons of them shop last minute, and expect everything to work perfectly in terms of shipping. It would actually be rational for the carriers to put pressure on retailers now, in anticipation of next Christmas, and for retailers to react with an understanding of their role in the mess this year. However, it would also behoove customers to think about ordering earlier, to avoid the whole mess.
In fact, I had kind of a similar experience, albeit infinitely smaller in scale, in that someone actually bought something from me on Amazon the week before Xmas. That would normally be good news, in that selling anything on Amazon is nice, in that it'll result in one less object in my place, a bit of extra cash in the bank, etc.. The catch was that the customer placed the order late on Friday night. I was traveling to my parents for the holiday on Monday morning, with no time to go to the post office early before going to the airport. That meant that the only time to ship the item out was Saturday morning, since the post office closes early on Saturdays. Fortunately, I did it. But you see the problem, or potential problem, which the customer may not have intended, but it might well have been had I seen the message late.
So what will happen next year with the late holiday on-line purchases and shipping stress situation? My lazy guess is more of the same. But I've been known to be wrong before. With that, time for the usual SNLC protocol, namely your loser stories of the week, holiday-flavored if circumstances warrant.....