Nobody likes delays in transit. Rush hour traffic, trains not running, flight delays — no matter what kind of disruption it is, people hate hold ups between Point A to Point B.
Shipping is no exception. Even in the face of global events like wars, pandemics, and economic downturns, customers still want their orders delivered on time. So for ecommerce businesses to stay in the game, it is imperative to manage customer expectations around shipping, and stay on top of shipping delays to prevent them from snowballing into larger problems.
In this article, we’ll dive deeper into the common causes of shipping delays, explore their impact on retailers and customers, and share tips for mitigating them.
The state of shipping delays in 2022
Port congestions, nationwide lockdowns, and international shipping restrictions presented unprecedented challenges to the shipping industry during 2020 and 2021. This trend continued into early 2022, mainly affecting the freight container shipping supply chain.
Although there were plenty of ships and containers, a huge surge in demand for ecommerce goods clogged ports and slowed circulation. This affected actual capacity, decreasing it by as much as 10-15% according to some estimates. Businesses that hadn’t prepared for a disruption on this scale were left without back-up plans, and suffered greatly as a result.
Despite their world-class resources and robust infrastructure, even retail giants like Amazon felt the sting of shipping delays. Since Amazon had to prioritize essential items, the ecommerce giant struggled to meet consumer demand for other items, with Prime orders experiencing much longer wait times than usual.
The situation didn’t seem to ease up as 2022 progressed, with Russia’s invasion of Ukraine causing additional strain. By May, about one-fifth of the container ship fleet worldwide was stuck in congestion at major ports across the globe, according to a Royal Bank of Canada (RBC) study. It was taking 74 days longer than normal to ship something from China to the United States.
However, as we approach the end of 2022, things seem to be calming down slightly. Port congestion has begun to ease up, and the cost of shipping goods has started to fall — perhaps as much as 80% for goods shipping from Asia to the United States — though with the holiday crunch upon us, it may be too soon to say that ecommerce is out of the woods.
What causes shipping delays?
All sorts of things can cause shipping delays, but some triggers are far more common than others. Here are some of the most typical causes of shipping delays.
Worldwide events such as pandemics, wars, and other emergencies can cause massive upheavals in the shipping landscape. Recent examples include:
- The COVID-19 pandemic, which led to billions of dollars’ worth of losses for businesses
- The Russian invasion of Ukraine, which led to the closure of vital ports in Russia and halted operations in the Black Sea
- The blockage of the Suez Canal, which lasted for six days and held up billions of dollars of goods each day
Unfortunately, merchants can neither control nor foresee global emergencies such as these, which make the resulting supply chain delays particularly difficult to mitigate.
“The 2020 holiday season was rough, and I remember our customer service tickets exploding through the roof. But whenever we would have issues with shipments and with fulfillment, ShipBob was always there. They were always communicating with us — we felt free to ask questions, and we always got answers.
They kept us informed on how they were resolving issues, from supply chain delays, to how they were navigating staffing shortages in the midst of the pandemic. We felt completely in the loop. ShipBob’s transparency allowed us to make better decisions on our end, and gave us the visibility and clarity we needed to make the right moves for our business.”
Aaron Patterson, COO of The Adventure Challenge
Supply chain disruption
Businesses may also face shipping delays due to disruptions in the supply chain. These disruptions may have a number of global and economic causes, but are typically related to problems such as supply chain shortages, port congestion, freight shipping capacity restrictions, and vessel delays.
The best way to prevent delays resulting from these disruptions is to build supply chain resilience. Distributing inventory and having backup suppliers are crucial strategies for avoiding supply chain disruptions.
Bad weather and natural disasters can also cause major shipping delays. At the most basic level, decreased visibility and treacherous conditions could cause transportation difficulties at the air, sea, and ground level. In more serious situations, “Acts of God” such as bush fires, earthquakes, floods, landslides, tornadoes, and cyclones could cause delays that last for several days.
National and international holidays
Many carriers observe closures during federal and international holidays, meaning they won’t pick up or ship orders on those days. A delay of even just one day can result in major backlogs and bottlenecks that further delay shipping.
During the holiday shopping season, spikes in order volumes can easily cause shipping delays on a large scale. Couriers may not have the capacity to handle a rise in demand during peak shipping seasons. Additionally, the shipping volume will also build up during those days when the courier isn’t in service, overwhelming the supply chain.
The shipping industry cannot function without the individuals that pick and pack orders, load and unload packages, sort them, and transport them to the assigned destination. Any labor-related issues can hit the industry hard, resulting in expensive delays.
During the COVID-19 pandemic, outbreaks in factories and warehouses were a major cause of shipping delays. Strikes, workforce shortages, and economic factors can also spark labor-related issues that delay shipping.
Incorrect shipping data
An old phone number, a small typo, or an incorrect address can also cause shipping delays. If the courier service doesn’t have sufficient information to deliver the package to the correct address, it may result in a lot of back and forth between different parties.
The package might end up getting sent back to the shipper, which is disappointing for the customer and expensive for the merchant.
The impact of shipping issues (on everyone)
Regardless of the cause, shipping delays have huge ramifications for ecommerce businesses. Here are just a few of the problems retailers face as a result of shipping issues, and how these issues affect all those involved in the supply chain.
How delays frustrate customers
Disappointment can turn into frustration if the delay takes too long — especially if the business does nothing to communicate with customers about it. With regards to the 2021-2022 supply chain crisis, 66% of consumers are already aware of supply chain delays, and subsequently more forgiving; they’re just looking for transparency from retailers about delays.
But even if a merchant is perfectly transparent, delays can still deter customers from converting. In 2022, 32% of customers abandoned their carts because of long shipping times. Even brand loyalty may not stop them from walking away, as 56% of consumers in 2020 chose to order from new retailers because they would experience shipping delays with their regular retailer.
“For us, changing from a 3 week lead time to 3 days through ShipBob is what drove our sales. Even now, one of the primary reviews we get on Etsy is, ‘My order arrived really quickly!’ Having the stock locally in the US means that lead times and shipping times are minimal, and that you’ll get higher conversion rates because you’re offering better lead times.”
John Greenhalgh, Co-Founder of A Year of Dates
How shipping issues damage retailers
When customers’ expectations around shipping are not met, the merchant suffers as well.
Carts abandoned due to shipping delays are lost sales and revenue for retailers. If that weren’t bad enough, shipping delays can also prompt dissatisfied customers to leave bad reviews that dissuade other potential buyers from going through with their purchases, further reducing sales and revenue. Loyal customers may lose trust in your brand if they feel they can no longer trust you to make timely deliveries.
Shipping delays impact a retailer’s demand forecasting and inventory management as well. In the finely-calibrated rhythm of restocking, a shipping delay can prevent your store from having enough of the right SKUs to meet demand — meaning you could end up severely overstocking or understocking.
How to address and prepare in advance for shipping delays
Shipping delays are inevitable — so as a merchant, the best ways to mitigate the their impact are to:
- Prepare for shipping delays in advance.
- Anticipate when shipping delays may occur.
- Deploy a honed strategy when you experience a shipping delay.
- Create contingency plans for unforeseen disruptions.
Here are a few tips to help you implement these strategies for your business, and handle shipping delays like a pro.
Offer free shipping where possible (to mitigate trust damage)
In 2021, one survey found that when given the choice between free shipping or faster shipping, 83% of consumers preferred free shipping. This implies that the majority of consumers are more likely to wait a few extra days for their order (and convert in the first place) if they can count on free shipping. So if your business can afford it, offering free shipping is a great way to insulate your customer satisfaction from shipping delays.
“We distribute inventory across ShipBob’s fulfillment network so we can be closer to major distribution hubs, shipping carriers, and more of our customers. This has helped reduce not only transit times but shipping costs.
We’ve seen an uplift in conversions by offering free shipping thresholds and 2-day shipping. Since switching to ShipBob from our previous 3PL, our fulfillment cost on comparable orders went down by 25%.”
Michael Peters, VP of E-Commerce Operations at TB12
Communicate often and clearly with suppliers and customers
Transparency and communication are essential to ensure that shipping issues or mistakes don’t cause further disruptions and customer frustration.
Keep an open line of communication with your suppliers so you immediately get updated in case of possible delays, which will allow you to mitigate the issue ahead of time. Additionally, this will allow you to arrange for alternative suppliers and back-up inventory when necessary.
Moreover, communicating clearly and regularly with your customers can help minimize their disappointment. Sending customers follow-up texts or emails regularly and providing attentive customer support when there’s a delay in their order is key to keeping customers happy in the face of unexpected challenges.
Provide shipment trackers
Being able to see exactly where their order is can give antsy customers some peace of mind. Even if a shipment is delayed, ecommerce order tracking gives customers an estimated ship date and ETA for their package, and reassurance that the package is on its way. This visibility improves the customer experience, and can even bolster a customer’s trust in your brand.
“With ShipBob, I’m able to offer competitive shipping rates and move more units than I would shipping from Australia with ridiculous postage prices. ShipBob also provides tracking, even for international orders, and helps with overseas customs.”
Lee Nania, Founder of Sub Submarine
Compensate with refunds, vouchers, and cashback
In the long run, bad reviews and lost customers may cost a business far more than compensation for a single bad shipping experience.
Consider offering refunds, vouchers, or cash to customers who are facing significant shipment delays. However, make sure to carefully assess when compensation makes sense, as compensating every late delivery will significantly impact profit margins.
Offer local pick-up options
Some delivery delays may occur due to a backlog on the courier’s end (often resulting from labor shortages and limitations in resources). As a result, many packages may not get delivered for a while, even though they’ve already reached the carrier facility in the destination city.
Offering local pick-up options gives customers a way to get to their package, rather than waiting for their package to get to them. While this option is typically only viable in larger cities or for businesses that have brick-and-mortar or B2B locations, in-store pickup or pickup at a carrier storefront (such as an Australia Post location) can ease customer frustrations.
Monitor your entire supply chain, regularly
To avoid shipping delays in the first place, it is essential that merchants keep tabs on every phase and activity within their supply chain, from procurement to distribution. When you know what’s happening at every stage of the supply chain, it becomes easier to anticipate problems that could cause shipping delays.
For example, if a new regulation in your supplier’s country could affect raw materials supply, you could mitigate delays by looking for back-up suppliers well ahead of time. Similarly, if your inventory is fully stocked, but you hear about a huge winter storm approaching, you can reorder more units ahead of time to prevent backorders.
Mitigate fulfillment issues with ShipBob
As a global omnifulfillment platform, ShipBob’s fulfillment solutions not only enable you to outsource picking and packing; they also improve your visibility into shipping operations to mitigate delays.
ShipBob’s software and dashboard provides real-time inventory and order tracking, so you can see every movement of your SKUs through the supply chain. You can also track orders from our fulfillment centers to your customer’s doorstep, and share the information with customers to keep them in the loop.
When it comes time to ship an order, ShipBob’s distributed inventory strategy enables you to provide affordable shipping that delights customers. Moreover, ShipBob offers discounted shipping rates that are pre-negotiated for you.
“The biggest logistical problem that our organisation has had in recent years is one faced by hundreds of businesses around Australia. The tyranny of distance. With ShipBob, we’ve been able to remove that.
With hubs in Sydney and Melbourne, which are two of our largest markets, we’ve been able to put our products closer to those who want them. We’ve been able to cut our freight and postage spend while removing labour costs.
For Betoota Outfitters, working with ShipBob has been easy and affordable. It’s been the perfect growth partner for our organisation and we look forward to working with them for years to come.”
– Errol Parker, Editor-at-Large, The Betoota Advocate
ShipBob also regularly shares data on transit times, carriers, and other performance metrics. Our fulfillment SLA badges, shipping performance data, and carrier-specific performance reports give you visibility into shipping performance, so you can facilitate transparency for your business and for your customers.
To learn more about how ShipBob can help you manage shipping delays and delivery, click the button below to speak to a fulfillment expert.
Shipping delays FAQs
Here are answers to some of the most common questions about shipping delays.
What shipping delays can I expect in 2023?
According to ShipBob’s data on leading carriers, shipping performance is improving with average days in transit seeing a downward trend, which is likely to lessen shipping delays in 2023. However, because it is impossible to predict certain factors that can delay shipments (such as global emergencies or weather anomalies), some delays are impossible to foresee.
Is there a shipping crisis right now? Why?
The pandemic resulted in a major shipping crisis that has lasted for a couple of years. However, things are starting to calm down since the onset of the pandemic, and the shipping industry will hopefully recover in 2023.
What are the most congested ports in the world?
The most congested ports in the world include the Shanghai Port, Singapore Port, Port of Busan, Shenzhen Port, Port of Guangzhou, Port of Hong Kong, Port of Ningbo, and Port of Qingdao. However, it appears that the supply chain and shipping crisis has improved in the past two years, with ports becoming less congested and shipping rates coming down.
Why are shipping costs so high?
Shipping costs increased significantly last year because carriers implemented fuel surcharges on top of typical annual general rate increases (GRI). Peak season surcharges further led to the increase in shipping costs.