Transcripts
Hello, and welcome to another episode of Unboxing the Trends.
Speaker:My name is Tim Ranagan, your host, and I've got with me again today.
Speaker:Lori Boyer, the host of Unboxing Logistics podcast.
Speaker:Lori, how you doing today?
Speaker:I'm doing so good, and I just wanna say, great job pronouncing my name.
Speaker:I have to speak on a lot of webinars and stuff, and people always, apparently
Speaker:I've got a hard name, Lori Boyer.
Speaker:I don't know, but you did perfect.
Speaker:I loved it.
Speaker:Well, I appreciate that.
Speaker:I appreciate the vote of confidence.
Speaker:Lori we're we're gonna talk about trends again this month.
Speaker:July didn't bring up some huge headlines.
Speaker:Right.
Speaker:But I'm just curious, you've mentioned that it revealed a lot,
Speaker:so I'd love to get your thoughts on what trends are kind of quietly
Speaker:making their way through the month.
Speaker:Yeah, July kind of flew under the radar a little bit, Tim, but I think for those
Speaker:people who are paying attention, there are some trends, some kind of things under
Speaker:the surface that are building, there's a couple, two things specifically that
Speaker:I really wanna touch on today as, as trends that I'm kind of keeping my eye on.
Speaker:We had our latest data come out around warehouse jobs, and
Speaker:that was really interesting.
Speaker:Our, our labor, we've actually had some dropping there and,
Speaker:and so I wanna get into that.
Speaker:That's one thing.
Speaker:Warehouse labor is something I'm keeping an eye on.
Speaker:And the other thing are kind of our carrier volumes.
Speaker:So, we're moving towards peak.
Speaker:July is done.
Speaker:July is, to me, like the very beginning of kind of looking at some forecasting stuff.
Speaker:It's like that tip of the iceberg, right?
Speaker:Exactly.
Speaker:Where, where companies start making some shifts and some changes.
Speaker:And so while there was nothing huge in the headlines, underneath, if
Speaker:you looked, there were just sort of some, some bubbling issues with both
Speaker:warehouse labor and with our carriers.
Speaker:So those are kind of the two things that I'd love to talk about.
Speaker:Awesome.
Speaker:Well, let's let's dive into warehouse labor a little bit.
Speaker:So we talked about this a little bit in last month's episode of
Speaker:Unboxing the Trends, but I'm curious, how serious is this labor
Speaker:conversation as we head into peak?
Speaker:Right.
Speaker:We kind of talked about it leading up the first, you know, two quarters of the year.
Speaker:I'm sure we have a lot of listeners out there that are wondering
Speaker:what this could or how this could impact us as we head into peak.
Speaker:Yeah, absolutely.
Speaker:So I think it's a little bit more concerning than I had thought previously.
Speaker:Typically, as we hit about July, from July through November, and these numbers
Speaker:change a little bit, but typically we see about 10 to 15,000 additional warehouse
Speaker:jobs open up to get us all through peak.
Speaker:In July, we actually lost almost 6,500 warehouse jobs.
Speaker:Quite a big contraction.
Speaker:We actually have our lowest number of total warehouse
Speaker:roles right now since COVID.
Speaker:Since the early days of COVID really when, you know, a lot of people had to go home.
Speaker:That's, to me, a big red flag about in a couple of different ways.
Speaker:It really shows that, you know, people are concerned about the, the
Speaker:seasonal ramp isn't quite materializing the way that maybe we anticipated.
Speaker:So some of these larger companies are kind of betting on maybe volume is gonna be
Speaker:lower and, and that maybe it's a little riskier than some of our signs have
Speaker:shown in terms of what the predictions and the forecasts across the board
Speaker:are for consumer demand through peak.
Speaker:That being said, you know, again, our consumer demand,
Speaker:our consumer confidence is low.
Speaker:We're still seeing a lot of, of purchases being made.
Speaker:So that does raise the point that if we do get a, a good volume or when
Speaker:we hit some of those microsurges that we talk about, when you get
Speaker:a big volume spike, warehouses may not be able to handle them quite as
Speaker:well as they would in a normal year.
Speaker:When they're understaffed, everything just slows down.
Speaker:Orders are gonna take longer to get picked, packed out the door.
Speaker:That just kind of creates a ripple effect when it comes to deadlines
Speaker:and really just makes everything a little bit more difficult.
Speaker:So yeah, if I were a shipper right now, I'd be paying very close attention
Speaker:to what's going on in the warehouse.
Speaker:Okay, great.
Speaker:So let, let's dive into the warehouse a little bit, right?
Speaker:EasyPost, we work with a lot of 3PLs, so we kind of hear feedback
Speaker:from that side of the warehouse.
Speaker:What does this mean for the 3PLs?
Speaker:What does this mean for internal fulfillment operations?
Speaker:Can you dive into that a little bit as well, Lori?
Speaker:Yeah, sure.
Speaker:So for me, again, if you're a shipper and you rely on a 3PL,
Speaker:or even if you have your own internal, you know, fulfillment ops.
Speaker:This means that you shouldn't assume that your partners are gonna be
Speaker:a hundred percent ready for peak.
Speaker:3PLs they're great and, and they're amazing and we work
Speaker:with 'em all the time, you said.
Speaker:But since what the numbers show is that warehouse staffing is down.
Speaker:Just communicate.
Speaker:Find out, you know, how are you staffing up what's your plan if my demand spikes?
Speaker:Are you using automation?
Speaker:That's another point here is it could be, and we don't have the data on this,
Speaker:it could be that a lot of warehouses are simply implementing more automation and,
Speaker:and so they don't need as many workers.
Speaker:So maybe that's the case with your 3PL.
Speaker:Maybe they're just using automation.
Speaker:And, and obviously if you, yourself.
Speaker:If you're running your own warehouse, your own fulfillment centers, just look
Speaker:for potential choke points, always.
Speaker:You know, look at your process now, if you are cutting back on workers or, or you're
Speaker:thinking, just make some contingency plans for what you do when volume spike.
Speaker:I'm gonna say when, Tim, because everybody's gonna get some good
Speaker:volume at some point this peak.
Speaker:I love that.
Speaker:I, I love that recommendation, Lori.
Speaker:Communication is key, especially as we head into peak season.
Speaker:No matter where you're at in your supply chain, reach out to those who
Speaker:are involved, especially when you get into these fulfillment centers.
Speaker:'Cause as we head into peak, as Lori mentioned, when that volume ramps up,
Speaker:you're gonna wanna make sure that you have plans in place and the contingency plan
Speaker:in place in case things get bottlenecked.
Speaker:That's exactly right on the nose there, Tim.
Speaker:And so, yeah, communicate, reach out, talk to 'em, what are you doing?
Speaker:What's going on?
Speaker:What are the plans?
Speaker:And, and make sure you have those plans in place.
Speaker:Awesome.
Speaker:Love that.
Speaker:Okay so we've talked about fulfillment center.
Speaker:Let's talk about that last mile stretch.
Speaker:Lori, what's going on with carriers as we head into peak,
Speaker:specifically UPS, FedEx, USPS?
Speaker:Is there anything that shippers need to be paying close attention
Speaker:to as we head into the, this last couple quarters of the year?
Speaker:So there were some interesting signs, again, you know, carriers I've actually
Speaker:really been diving into lately.
Speaker:I'm such a nerd, Tim, but like the trends decade over decade
Speaker:is because we're starting to see a lot of signals of carriers.
Speaker:There's some stuff going on in the carrier landscape in general that is a change.
Speaker:And so, yeah, this is a, a shout out for some upcoming webinars and
Speaker:stuff, but I will be diving into carriers in great depth and what's
Speaker:happening, so keep an eye out for that.
Speaker:But in July, we did see some additional numbers pop up around our
Speaker:carriers, especially our big carriers.
Speaker:Let me see if I can find the numbers.
Speaker:So we saw.
Speaker:July of this year to July of last year, a 7.3% decrease in the
Speaker:domestic package volume through that.
Speaker:That's a lot bigger jump than we usually see.
Speaker:It, it's a lot bigger than last year's dip.
Speaker:We had a dip last year.
Speaker:We had a dip the year before that.
Speaker:We're having a multi-year downward trend.
Speaker:To put that in perspective, before the pandemic, before all that we typically
Speaker:saw and what's typical in July would be a 3 to 5% growth over that time.
Speaker:So we're actually, again, seeing fewer packages going out.
Speaker:So that's what happens when consumer demand is soft.
Speaker:So again, this is a little bit of a signal about can demand being a
Speaker:little bit down especially when it comes to kind of ecommerce stuff.
Speaker:So carriers are trying to protect their margins.
Speaker:So we've seen in the last month or so, FedEx is consolidating its network.
Speaker:It's been cutting staff.
Speaker:Again with the about those warehouse numbers.
Speaker:USPS just raised their rates again.
Speaker:And some of these are big jumps, Tim, like I look at my number here.
Speaker:Medium flat rate box, for example, one of the most popular,
Speaker:most used went up over 11%.
Speaker:You know, it's a big jump on some of these rates, so.
Speaker:We're kind of seeing a shift as carriers are really trying to get
Speaker:their, their balance lines in order.
Speaker:So they, they really are focusing all their time on their biggest, maybe
Speaker:their most profitable customers, getting all the deals there.
Speaker:So.
Speaker:If you are especially a midsize, or really if you're a small size
Speaker:carrier, this is probably not the strongest time for you to be working
Speaker:with the big, big carrier solely.
Speaker:Always, I recommend diversifying, diversify.
Speaker:I would recommend that for everyone.
Speaker:You shouldn't ever have a single carrier.
Speaker:But especially right now when those kind of big carriers are not
Speaker:necessarily the most affordable.
Speaker:We're just seeing really large fees racking up there.
Speaker:You may wanna look at, you know, a lot of our customers, again,
Speaker:I'm, we are, as I like to say, we're, we're carrier agnostic.
Speaker:We love all our carriers and we work with hundreds.
Speaker:So but there are regional carriers.
Speaker:There may be last mile carriers.
Speaker:There can be some really specific kind of hybrid options you can use.
Speaker:I always recommend using, you know, if you're, so, if you're an EasyPost customer
Speaker:right now listening, please look at Luma.
Speaker:Luma is the AI tool that helps you compare all the different rates.
Speaker:If you are a small shipper, it's totally free.
Speaker:Above that there's a little bit of a fee, but you can really dig into the data and
Speaker:figure out which carriers might be the best for different routes for different
Speaker:zones, if you're urban versus rural.
Speaker:So you can look at your rate shopping.
Speaker:I would rate shop in real time.
Speaker:That's another big one, is as we move through peak and, and what
Speaker:we're seeing is sometimes those fees and stuff change really fast.
Speaker:So make sure you're constantly keeping an eye on it and just
Speaker:watch the performance data.
Speaker:So as some of these carriers are downsizing or or cutting staff.
Speaker:Make sure that your SLAs, your service level agreements are being met, and if
Speaker:that starts to slip, you, you're gonna wanna be able to shift really fast.
Speaker:Yeah.
Speaker:I love those recommendations, Lori.
Speaker:I just, I, I wanna kind of summarize a few of the things that you just suggest.
Speaker:Because they're really important recommendations for our listeners
Speaker:as we head into peak season.
Speaker:Remember, communication is key.
Speaker:Doesn't matter if you're communicating with your fulfillment network or
Speaker:with your carrier contracts, right?
Speaker:However you manage your carrier relationships, just remember that even
Speaker:if you're a small shipper, you can diversify your carrier network so that
Speaker:when some of these issues pop up that Lori just mentioned with our carriers
Speaker:happening this year that you have a plan in place, some contingencies in
Speaker:place, other methods that you can get your products out to your customers.
Speaker:So wonderful recommendations, Lori.
Speaker:Obviously EasyPost is a tremendous resource for you, but just our general
Speaker:recommendation for our listeners, whether you're an EasyPost customer or
Speaker:not, diversify, diversify, diversify.
Speaker:It's the number one issue that we see in our industry, and it
Speaker:really, really can support you.
Speaker:Especially as we head into peak season, there's still plenty of
Speaker:time to get out ahead of some of these bottlenecks that you may face.
Speaker:Well, and especially I think, Tim, as we are potentially facing
Speaker:a little bit of a downturn and a potentially soft peak season.
Speaker:In shipping, you know, those are costs that can be saved.
Speaker:So there are opportunities to save a lot of money by shifting some of
Speaker:your volume to different carriers.
Speaker:And so, yeah, we may not be able to increase the number of packages going
Speaker:out, but you can definitely decrease the cost that you've got going sending
Speaker:out to, to your carrier network.
Speaker:So.
Speaker:Just definitely keep an eye on that.
Speaker:I completely agree with that.
Speaker:Communication, your list was fabulous.
Speaker:It was exactly.
Speaker:You need to communicate, you need to diversify, keep an eye on what's going
Speaker:on and, and really this peak season, it's a peak season of uncertainty
Speaker:and, and a little challenge.
Speaker:You've gotta be ready to pivot and be able to make changes kind of on the fly.
Speaker:Last question for you, Lori.
Speaker:We do this every peak season, but I'm just curious to get your
Speaker:opinion as we head into peak 2025.
Speaker:I'm sure our listeners are like, what's Lori Boyer's number one, recommendation of
Speaker:things that she's learned from past years, data that you may have accumulated.
Speaker:What is your number one recommendation, the biggest advice you can offer
Speaker:to shippers as we head into peak?
Speaker:Okay, so heading into peak right now, I think that the best thing you
Speaker:can do is to examine your systems now before you're moving into peak.
Speaker:So you've got a little bit of time.
Speaker:We're August, oh my goodness.
Speaker:It's August.
Speaker:We're already seeing, you know, the latest data shows the majority of
Speaker:people start their, their holiday shopping well before Halloween.
Speaker:So we're right there.
Speaker:We're right on the precipice.
Speaker:Don't assume that everything's just gonna go according to plan.
Speaker:Assume the opposite, be, find the Boy Scout motto to be prepared and
Speaker:try to run through those scenarios.
Speaker:Figure out maybe where you can save a dollar or a penny or, or something.
Speaker:And that's really gonna add up for you and, and just take your time to make
Speaker:sure that you're looking at and have visibility and understand what's going on.
Speaker:Wonderful recommendations, Lori.
Speaker:Well, thank you Lori, for all of your thoughts and opinions.
Speaker:You've shared a lot of great information.
Speaker:These definitely were some of the more quiet trends that have kind
Speaker:of permeated throughout July.
Speaker:And to our listeners, this has been another episode of Unboxing
Speaker:the Trends from Easy Post.
Speaker:If you would like to get involved, please make sure you like
Speaker:and subscribe to our content.
Speaker:If you'd like to see more content from Lori across our podcast network, make sure
Speaker:you visit us at easypost.com/podcasts.
Speaker:Until next month.
Speaker:See you later.
