In September, PARCEL Forum ‘24 brought top professionals from the small-package industry to Dallas. They discussed trends and challenges in parcel shipping, networked with peers, and forged new partnerships. Sifted was well-represented, both through our booth and speaking at the event.
Our attendees included:
- Ryan Benware, Account Executive
- Cameron Clark, Manager of Data Science & Analytics
- Hannah Hughes, VP of Marketing
- Nick Koontz, Senior Account Executive
- Jeremy Lee, VP of Sales & Research
- Jon Mayer, Account Executive
- Caleb Nelson, Co-Founder
- Stephen Rolf, Enterprise Account Executive
- Roy Schmeidler, Account Executive
Here’s a summary of what we learned about the industry from the conversations at the show:
Shippers Are Ready To Harness the Power of AI
“Evolution of AI” and “Predictive Analytics” were two learning pods on the PARCEL Forum agenda, and both educated shippers on the benefits of Artificial Intelligence.
“AI” has been one of the business world’s most prominent buzzwords of the last two years. While the explosion of generative-AI tools like ChatGPT and DALL-E have built excitement around AI’s potential, it’s also created some misconceptions about what AI is.
Attendees were educated on the different types of AI – primarily, traditional vs generative, and how they’re able to benefit parcel shippers.
Clark and Lee delivered the presentation 605: The Power of AI in Parcel Applications, which further explored AI models that are already used in many parcel-focused software tools.
Key takeaways from the session:
- Current software tools help make work easier. Next-generation tools should deploy AI that does work for people.
- Parcel-focused AI tools use industry-wide knowledge and data inputs to give context to your shipping performance, monitor your shipping profile, and model future forecasts and changes, and are far more powerful than an internal tool.
- Data security should be every shipper’s priority when finding AI tools. Only work with companies with industry knowledge and a track record of data security.
Sifted is leading the industry’s charge with the launch of SiftedAI, the third generation of Logistics Intelligence.
SiftedAI uses AI to power in-platform algorithms, analyzing patterns in complex parcel data to uncover insights and make predictions for future outcomes.
Returns Are a Problem Needing a Solution
In 2023, 17.6% of online retail sales were returned, and 13.7% of returns were fraudulent, totaling a value over $101 billion.
Needless to say, returns are a big problem for eCommerce companies.
Luckily, returns management and reverse logistics are a particular area seeing tremendous technology growth.
Improved data analytics give shippers a clearer view of what it costs to return a package, and how much returns as a whole are costing them. This can inform better return policies, such as offering free returns, or if it’s cheaper to just let customers keep low-value items.
Other returns management technologies are improving the restocking process by:
- Improving return-to-stock speeds and levels
- Reducing the amount of returns that end up in landfills
- Finding manufacturing defects that lead to returns
- Identifying potential return fraud and addressing repeat offenders
One of PARCEL Forum’s Speakers, Kyle Bertin, Co-Founder and CEO of Two Boxes, covered these topics on an episode of LeaderShipping.
It’s a Shipper’s Market
While carriers continue to raise rates at near-record highs, they’re also offering aggressive discounts. Those willing to explore new carriers or renegotiate existing contracts will find themselves having more leverage than in recent years.
What factors have led to the shipper’s market?
It’s no mystery – shipping volumes are down. After the pandemic spurred an eCommerce boom, volumes have normalized back to pre-COVID levels. However, carriers invested in expanding capacity during those volume peaks, and now have excess capacity to fill.
UPS in particular has a volume gap to make up after clients defected amid the Teamsters strike threats of 2023.
Meanwhile, new alternative carriers have emerged.
- OnTrac has led the charge of regionals, expanding their network to now reach 70% of the U.S. population across 35 states and Washington D.C.
- The USPS is undergoing a transformation plan to become more financially viable, and their new Ground Advantage service has proven a popular offering in the commercial parcel industry.
- Amazon launched Amazon Shipping in late 2023, finally fulfilling years of predictions that they’d one day challenge UPS and FedEx as a carrier.
Sifted’s experts delivered a presentation on Amazon Shipping as well. Nelson and Lee presented 104: Amazon Shipping, Challenging the Status Quo. The session covered how Amazon slowly built a network that could challenge the national carriers, what sets them apart from other carriers, the strengths and weaknesses of Amazon Shipping, and how to make the most of a multi-carrier strategy.
Key takeaways included:
- Shippers hold the upper hand in negotiations right now, and need to take advantage of this before the market shifts back to carriers’ favor.
- Amazon Shipping could be a great carrier for eCommerce shippers looking for savings or simplified rate structures.
- Insights from shipping data should drive negotiations and inform multi-carrier shipping strategies.
Parcel Shipping: Looking Ahead
The world of parcel shipping is constantly evolving, and that’s never been more evident than it was at PARCEL Forum. While carriers and consumers alike add complexity to shipping, new technologies are emerging to help shippers take control of their operations and optimize 100% of their spend. Those who don’t will be left behind.
Stay ahead with next-generation, AI powered parcel tech. Request a demo of SiftedAI.
