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October 23, 2020

E-Commerce Surge & Capacity Constraints Await Retail Peak Season

COVID-19 has drastically impacted consumers and altered their spending behaviors, causing a significant increase in global e-commerce. According to Transport Topics, “global e-commerce sales are expected to exceed $4 trillion this year compared with $3 trillion in 2019, as detailed in a logistics trend report. 

Shoppers have shown hesitation to go into crowded storesand as a result, online shopping and pursuing pickup orders have become their tendency. According to Hartford and Reed on Talk Business and Politics, “retailers expect sales to rise in the second half of 2020, which supports strength in freight demand while nonessential freight demand improves.  

Transportation Opportunities  

There are many transportation opportunities this holiday shopping season as consumers attempt to steer clear of the virus and shop earlier to avoid product shortagesLogistics companies should keep in mind that an extended peak in freight demand is expected and will require tens of thousands of local drivers 

However, since a large number of companies have lost drivers due to the pandemic, many have been influenced to raise driver payAs summarized by the CEO of Indianapolis-based driver recruiting firm, DriverReach, companies are implementing this incentive in hopes to attract drivers and meet the dramatic surge in e-commerce demands. 

Capacity Constraints 

E-commerce purchases are likely to continue into the holiday season. The implication of this for freight carriers is a continuation of “pandemic retail spending patterns” that ultimately leads to capacity constraints, according to Transport TopicsTo address shortages in availability and meet increasing e-commerce demands, retailers should diversify their carrier network 

Overview 

While the delivery volume to distribution centers and directly to consumers keeps risingstates Transport Topicse-commerce growth is great news for most trucking businesses. Trucking demand is determinant on inventory restoration, so a rise in e-commerce means increased shipment opportunities 

  

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