How The Peak Holiday Season Will Be Different For the Transportation Industry This Year

• November 06, 2020
• Madeline S.

The holiday shopping season is one of the busiest for the transportation and logistics industry. It’s quickly approaching, and trucking companies can expect some significant changes this year due to COVID-19. From an extended season to increased volume, here are some of the ways the peak holiday season will be different this year for the industry.

Extended Season

Black Friday has marked the start of the holiday season for the past few years, pushing the beginning of the season earlier and earlier as it grows. November and December are still the peak months of holiday shipping, but that might change this year. A new report by Voxware found that 51% of consumers expect to start holiday shopping earlier this year. Shippers and consumers have been embracing online shopping due to the pandemic, and the threat of a second wave in the fall and winter months means that people are looking to get their holiday gifts as soon as possible, extending the peak holiday season for carriers.

Increased Volume

Parcel volumes increased rapidly during the COVID-19 pandemic. With physical retail locations shut down or restricted, consumers turned to online shopping for everything from gifts to household goods. As a result of COVID-19, e-commerce accounted for 16.1% of total U.S. retail sales during the second quarter of 2020. Even as physical locations open up again, consumers have been slow to return to them. The threat of a second wave, travel restrictions, and tighter holiday budgets will have more consumers shopping online for holiday gifts. The peak holiday season is always busy for carriers, but they should brace themselves for even more volume this year.

E-Commerce Focused

The peak holiday season has been increasingly e-commerce focused, and that is expected to increase this year. Last year, e-commerce spending in the U.S. reached a new record of $142.5 billion, up 13.1% from the previous year. That number was already expected to rise for 2020, but COVID-19 may see those numbers surging even higher than predicted. The Voxware survey found that 76% of consumers stated they intend to purchase more than half of their gifts online this year. An e-commerce heavy peak holiday season poses a number of challenges for the industry, but companies that embrace this new normal and work with shippers will be rewarded.

Tight Capacity

Surcharges and additional costs will likely not be enough to manage capacity. The transportation and logistics industry has been struggling with a driver shortage for years, and COVID-19 exacerbated that problem with many older drivers retiring earlier than expected due to health risks. Many companies also didn’t survive the pandemic, further restricting capacity. With fewer trucks and drivers, increased parcel volume, and an extended season, carriers should expect capacity to be tighter than normal this peak holiday season.

The peak holiday season is always a busy time for the transportation and logistics industry, and this year is going to be even more challenging as a result of the pandemic. This holiday season may be a difficult one, but it has the opportunity to be the most profitable yet for the trucking and transportation industry.

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