Cifotart/stock.adobe.com
Commissioned by UPS Capital, the 2024 Mid-Year Guide to Shipping Excellence report explores the primary shipping challenges merchants are facing as e-commerce booms, offering actionable advice to help businesses not only survive but thrive in this evolving landscape. Drawing from the perspectives of 500 e-commerce merchants and 1,000 consumers, the conclusion is clear: businesses that fail to adapt and fortify their supply chains risk being left behind in the wake of this e-commerce revolution.
Key Takeaways:
- Most merchants surveyed (92%) report their company would be prepared if their shipping volume were to increase by 30% this year. However, growing pains, intensified by rising consumer expectations, remain inevitable, creating large barriers to success for businesses.
- Over 2-in-5 (42%) merchants surveyed report it takes two or more days to have an online order ready to ship. Yet 46% of surveyed consumers expect to receive their online orders within three days (excluding purchases from big-box retailers like Amazon, Walmart, and Target). This discrepancy points to the need for full shipping visibility between merchants and consumers to manage expectations vs. reality.
- Despite this discord, merchants consider faster delivery demands to be a lesser threat. Surveyed merchants instead cite rising shipping costs (52%) and shipping issues like damaged (40%) or lost (37%) items as the greatest challenges to their business.
- For apparel merchants specifically, warehouse limitations are becoming a thorn in their sides. Surveyed apparel merchants state physical storage space (50%), quality control assurance capacity (47%), and inventory stock level gaps (43%) as the biggest constraints.
- Shipping issues aren't just domestic as e-commerce’s popularity is going global. Nearly half (45%) of merchants surveyed are currently shipping more than 20% of their orders internationally, with 73% of surveyed consumers making online purchases shipped from other countries. However, borderless shopping comes with additional complexities. Nearly 3-in-4 (73%) merchants surveyed report their business has been impacted by international shipping mishaps (e.g., delays, damage, or theft) due to congested overseas ports in the last 12 months.
- A primary factor contributing to this mounting threat is time-consuming manual verification processes, with over 2-in-5 (41%) merchants surveyed saying they’ve had difficulty mitigating fraud risks due to this. Moreover, other respondents say exploitation of lenient return policies and pressure to minimize customer dissatisfaction contribute to the challenge of identifying fraudulent vs. valid returns.
- Nevertheless, consumers believe counterfeit goods are the real concern. A notable 41% of consumer respondents say counterfeit is trending upwards, with 23% reporting they’ve received a counterfeit item instead of the authentic product they purchased online. Gen Z appears to have the most issues with counterfeiting, given 43% of respondents in this demographic personally experienced counterfeit fraud.
