Ask AFS: Will There Be A Peak Season This Year?

Man signs for a package from a delivery person with a package dolly

We’ve been hearing a lot of reports that suggest this year’s peak season could wind up being a bit “eh” for many businesses. What’s your take?

You mean reports like these?

  • “This year’s peak shipping season is arriving with a whimper” (Wall Street Journal, August 29, 2023)
  • 28% of consumers say they plan to spend less this holiday season, while only 9% say they plan to spend more (Gartner Marketing Survey, June 2023)

Yeah, we’ve seen them, too – and gotten an earful about the fact that everything from ongoing inflation to $10 billion worth of student loan payments could significantly cut into the amount that consumers are willing to spend on holiday gifts this year

However, we’ve also seen a lot of other reports that suggest there will still be a peak season for retailers in some form or fashion, which is why we’re advising our parcel clients to continue preparing for a seasonal surge

Tell us more, because we could really use some good news.

According to Deloitte’s annual holiday retail forecast, holiday retail sales should be anywhere from 3.5 to 4.6% higher than they were in 2022; and according to forecasts by eMarketer, overall holiday spending will increase 4.5%.

While these figures don’t equal or exceed the 7.6% holiday spending growth that Deloitte reported in 2022 – or the 5.3% growth that the National Retail Federation reported during the same time period – they still represent a seasonal uptick in sales traffic.

So, Christmas and Hanukkah are still coming?

Brace yourselves the holidays are coming GoT meme

Absolutely. But so are more cost-conscious consumers. In fact, one in three of them are worried about having to go into credit card debt in order to make holiday purchases. And almost all of them are looking for ways to make their holiday spend go further by shopping at discount stores, off-price retailers or waiting for special sales and promotions.

They’ll also be more sensitive to high parcel shipping prices, so do what you can to help them reduce those expenses, since national parcel carriers clearly aren’t going to cut them any slack.

Any suggestions?

Encourage them to take advantage of things like Buy Online or Pick Up In-Store options if they’re purchasing oversized products, because the cost of shipping those products could be especially prohibitive. (And if you don’t have brick-and-mortar store locations, bear in mind that you can always use carriers’ store locations instead.)

In addition, advise them to shop earlier in the holiday season so they don’t have to pay extra for premium shipping services, especially since the national carriers usually cancel all of their service guarantees later in the holiday shopping season anyway.

Finally, don’t stop doing everything you can to negotiate the best possible rates, surcharge reductions and contract terms with parcel carriers. You can always pass at least part of these savings along to your customers in the form of lower shipping charges.

To view more of our peak season advice, check out our Fourth And Wrong: 5 Ways To Head Off Peak Season Issues blog. Or drop us a line.

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