The Importance of Supply Chain Collaboration Between Retailers and Suppliers

Discover the 4 ways retailers benefit from collaborating with their supply chain vendors.

Over the past few years, the landscape of the global supply chain has faced various shifts and disruptions, reshaping the ways that many businesses operate and collaborate with one another. This period of transformative events and trends has exposed many companies’ vulnerabilities, tested their resilience, and most of all, proved the importance of adaptability and collaboration across the entire supply chain network. Especially when it comes to the retailer-supplier relationship, the recent rise in e-commerce and continued evolution of technology has echoed the significance of an efficient collaboration.

In today’s intricate world of commerce, where customer demands are soaring, the success of retailers and suppliers weighs heavily on their ability to collaborate seamlessly within the supply chain more than ever before. The flow of products from manufacturers to store shelves and into the consumer’s shopping cart relies on synchronized and robust supply chain operations. An interdependent relationship between both parties sets a sturdy foundation for cost savings, demand planning, continuous improvement, and improved customer experiences among many other key factors that make their collaboration crucial.

Key Benefits to Collaboration

Here we’ll take a closer look at some of the primary benefits of a strong connection between these retailers and their vendors.

  • Cost optimization: Effective supply chain collaboration between the retailer-supplier relationship presents the opportunity for significant cost savings. By working together closely, both parties can streamline processes, look for areas of improvement, and eliminate any inefficiencies. By sharing information on demand, production, and logistics, together they have better visibility in identifying cost savings such as consolidating shipments and optimizing shipping routes. Additionally, for both retailers and suppliers, the cost savings can be reinvested into bettering their business or even passed on to their customers.

  • Demand planning and forecasting: By utilizing collaborative demand planning and forecasting, retailers and suppliers can view and understand more accurate predictions of product demand, allowing for improved overall preparation. This also allows retailers to share real-time data and forecasts with suppliers who can use it for things like production scheduling, adjusting inventory levels, and clearer visibility of the supply chain for both sides to proactively tackle any potential disruptions or opportunities. Collaboration on demand planning and forecasting can also reduce the chance of products being under or overstock, ensuring the products in demand are available at the right time.

  • Continuous improvement: Working collaboratively in the supply chain drives continuous improvement for each partner involved. When retailers and suppliers work in collaboration, it enables the exchange of successful strategies and best practices, advice and lessons learned, as well as performance feedback. By partnering in analyzing data, both parties can identify inefficiencies and opportunities for optimization, fostering growth on each side. A collaborative retailer-supplier duo is also important for staying on top of trends, evolving technology, and innovative solutions, adaptations businesses should make if they want to remain competitive. Especially with the various supply chain shifts experienced in the last few years and the unpredictability of the supply chain today, retailer and supplier collaborations are important for staying resilient, agile, and responsive to changing market dynamics.

  • Enhanced customer experience: When retailers and suppliers work together like teammates, it can help them ensure product availability, timely delivery, and seamless order fulfillment. Collaborative efforts also lead to faster order processing, shorter lead times, and better delivery efficiency, resulting in a reliable service that will keep customers coming back. By working closely together to address issues and proactively face challenges, retailers and suppliers can better mitigate risk, improve their communication, and provide an exceptional customer experience. Lastly, shared real-time data and shipment tracking between the two can help both parties stay informed on potential delays and monitor daily delivery performance. All these collaborative efforts build customer loyalty and leave customers satisfied.

Supply chain collaboration between retailers and suppliers has proven crucial to finding shipping success. Working together enables opportunities for cost optimization, improved operational efficiency, positive customer experiences, and overall greater supply chain visibility. The collaboration also plays a vital role in ensuring product availability, timely delivery, and seamless order fulfillment.

After the collaborative partnership is confirmed, the next step is finding a shipping solution that streamlines these collaborative efforts and enables retailers to work with suppliers in a way that meets the unique needs of each relationship for optimal outcomes. Implementing a shipping software solution is an effective way to enhance the relationship and produce optimal operational outcomes.

Varsity Logistics offers robust and comprehensive freight and parcel shipping software solutions for IBM i/AS400 systems that enhance communication and transparency, optimize logistics processes, and enable retailers and suppliers to synchronize their operations and meet delivery expectations for the end customer. It unlocks a new level of accuracy and visibility with document generation and detailed historical data visible for analysis and reporting. The software also helps customers manage their selection of carriers and optimize shipment pricing, fostering seamless collaboration, elevating the competitive edge, and enhancing the overall customer experience.

Interested in simplifying and streamlining your supply chain strategy with shipping software? Get in touch with our team of experts today to explore the ways Varsity Logistics can enhance your shipping operations and transform the way your business handles logistics.

7 Benefits of Carrier Diversification

Learn how carrier diversification reduces costs, improves customer satisfaction, and more.

Everyone’s familiar with the saying, “Don’t put all your eggs in one basket”. The expression is a warning against concentrating all your resources or efforts into one place or thing. When relying too heavily on a single option, you potentially put everything at risk in the event of a crisis. Although this time-worn phrase dates back to the 1600’s or earlier, it still remains applicable to an abundance of situations, including your shipping strategy.

An effective way to apply this advice to your shipping strategy is by diversifying your carrier mix. This provides shippers with carrier options in the event of a supply chain disruption. The saying became especially relevant in the logistics world after the pandemic struck, causing a spike in e-commerce, disruptions in carrier networks, shifting consumer behavior, and more.

7 Reasons to Implement a Carrier Diversification Strategy

Post pandemic, in today’s rapidly evolving shipping landscape, supply chain innovation and adaptability are essential. Still, amidst times of changing consumer expectations, dynamic market conditions, labor unrest and other unforeseen circumstances, businesses are realizing that carrier diversification is a key driver of success. If you are looking to inject flexibility into your shipping processes, mitigate risks, enhance service coverage, and unlock new opportunities, then carrier diversification is a strategy to put in place. Here are seven ways having more than one major carrier can benefit your business:

1. Carrier Diversification Reduces Risk

Relying on a single carrier can pose risks such as service disruptions due to weather, labor strikes, or unforeseen circumstances. By diversifying carriers, you reduce the risk of shipping disruptions having a devastating effect on your business by distributing shipping volumes across several providers. Additionally, with an advanced multi-carrier shipping solution, if one carrier experiences an issue, you can seamlessly switch to an alternative carrier. This redundancy helps to continue the flow of goods, ensure timely delivery and business continuity, and minimize the impact on your shipping operations.

2. Carrier Diversification Increases Flexibility and Scalability

By integrating multiple carriers into your shipping software, you gain the flexibility and scalability to adapt to evolving market conditions, shifting consumer preferences, and seasonal demands. It allows you to find the best carrier suitable for specific needs on a shipment-to-shipment basis, based on factors such as cost, transit time, destination, and service level. This agility allows you to optimize your shipping operations and handle fluctuations in consumer demands efficiently.

3. Carrier Diversification Uncovers Competitive Shipping Rates

Competitive Shipping Rates: Carrier diversification enables you to compare shipping rates across multiple providers. Each carrier may offer different pricing structures, discounts, or negotiated rates based on several favors like your shipping volume, destination, or time in transit. By having options, you can identify the most cost-effective shipping solutions for your business, potentially reducing shipping expenses and passing along those savings to retailers as well.

4. Carrier Diversification Improves Geographic Coverage

Incorporating different carriers into your shipping software allows businesses access to a broader network of delivery routes and service areas. Individual carriers typically have strengths in certain regions whether that be local, regional, or international. By diversifying carriers, you can expand your shipping reach to more areas and access markets that might be underserved by a single carrier. This allows you to leverage your established expertise in different geographic locations while also growing your business. Carrier diversification helps you reach a wider customer base and opens the door to entering new markets with confidence.

5. Carrier Diversification Improves Service Levels

Different carriers have their strengths and weaknesses, such as specific routes, delivery networks, or specialized services. By diversifying carriers, you can fill the gaps in areas where some carriers might be as efficient. This allows you to tap into each carrier’s unique strengths and select the option that best aligns with your specific shipping requirements. This can result in faster delivery times, higher customer satisfaction, and overall improved service levels.

6. Carrier Diversification Empowers Negotiation

When you have multiple carriers integrated into your shipping software, it strengthens your position during carrier negotiations. You can leverage competition among carriers to compare rates or service capabilities. Carriers may also be more likely to offer you discounts, customized solutions, or other attractive incentives to secure or maintain your business. Overall, negotiation allows businesses to vouch for more favorable pricing, contractual agreements, and value-added services.

7. Carrier Diversification Improves Customer Satisfaction

Every business has the goal to provide an exceptional customer experience- after all, it’s what builds brand loyalty and customer trust. By expanding your carrier library, you increase customization abilities, flexibility, and other great options for customers. It also allows for the selection of carriers based on factors like reliability, delivery speed, and geographic range that best aligns with your customer’s needs. With higher consumer expectations surrounding deliveries today, customers appreciate carriers who can get them their goods in a safe and timely manner.

How Carrier Diversification Facilitates Growth

Overall, diversifying your carrier mix offers a variety of benefits for businesses navigating the ever-evolving world of supply chain and logistics. This strategy enables greater flexibility, improved service levels, cost optimization, risk mitigation, expanded market reach, negotiation power, and increased customer satisfaction. Integrating multiple carriers provides operational redundancy, allowing businesses backup options in the event of disruptions and other unforeseen circumstances. Additionally, carrier diversification creates the opportunity for businesses to expand their reach, enter new markets, or those that may be under serviced. Embracing a carrier diversification strategy is imperative and empowers businesses to construct resilient, streamlined, and customer-focused operations in a constantly evolving marketplace.

Need help getting started with a carrier diversification strategy or shipping software? Contact our experts today to discover how Varsity Logistics can improve the way your business does shipping.

Ship FedEx? Varsity is FedEx Compatible

Varsity proudly announces FedEx Compatible Community 2021 status achievement.

If your company ships a lot of packages a day (from the low 100s to the mid 1000s), saving a little money here and there can really add up. 

Varsity Logistics makes it easy to ship and save with FedEx, which is one of the reasons we’ve achieved FedEx Compatible Community status for 2021.

Varsity ShipSoft software works with all the major parcel carriers to generate your best method + service + price in real time so you and your customers save on shipping costs. Then, our ShipAudit software ensures that your invoices match your contract rates. 

Learn how Varsity Logistics multi-carrier shipping software can take your parcel strategy to the next level. Visit our Request a Demo page to connect with a Varsity Shipping Specialist to learn more today.

Zone Skipping: Will it Work For Your Business?

Learn how zone skipping can save money on shipping costs while improving customer experience.

Logistics operators looking to reduce transportation costs and improve transit time might want to consider Zone Skipping, a logistics technique that consolidates individual packages and ships them directly to a parcel carrier’s induction hub that’s closer in proximity to the final destination points of the consolidated packages.

How does Zone Skipping work?

Let’s say you’re shipping 5,000 parcels from Oklahoma City to Detroit at $10 each in shipping costs, which means a grand total of $50,000. The flat rate, however, is $5,000 if they all arrive in a truck. From there, shipping the individual parcels from the Detroit sorting facility will cost $7 per parcel. So, if you add the $5,000 flat rate shipment with the $7 per parcel for local delivery, the total shipping will equal $40,000 — A $10,000 savings compared to using the parcel carrier for shipping the parcels individually.

How can Zone Skipping benefit my business?

Here are 4 ways that that zone skipping can improve the way you ship parcel.

Cost Savings

As explained above, by relying on local delivery for the final zone, operators will cut costs which they then can pass onto their customers. (The savings come from eliminating multiple sort and transfer points.) The saving will not just save your company significant money on shipping, but it will earn you customer loyalty based on a faster delivery time.

Faster Transit Times

Zone Skipping means parcels no longer have to crisscross the country to multiple sorting facilities before they reach where they need to go. Now parcels will go directly to the destination via local carriers. The faster delivery times could allow you more time to accumulate additional package volume when building your zone skipping loads.

Greater E-commerce Capabilities

As e-commerce continue to dominate online retail, operations that get parcels directly to consumers without hassle will be leading the pack. Consumers now have increased expectations for how long an order will show up on their doorstep. Zone Skipping is tailor-made for meeting those immediate needs.

Fewer chances for damaged packages

Another reason why Zone Skipping is good for customer loyalty is because it reduces product damages. This is because it eliminates the number of sorting and consolidation steps performed by the parcel carrier. The fewer hands touching the packages, the greater the chances it won’t be dropped, dented, or damaged.

What do I need to implement Zone Skipping?

Here are 3 things to do before you implement a zone skipping strategy.

Evaluate the areas you serve

Zone Skipping is only cost-effective if you routinely have a large number of parcels going to the same area. How many orders are headed to the same region? How many steps are in your shipping process? Remember, the more steps reduced, the greater the cost savings to your business. Having a system that allows you to turn zone skipping on/off based on current volume is ideal.

Evaluate your internal infrastructure

You’ll need software that can handle the increased capacity requirements that result from Zone Skipping. Because of volume, Zone Skipping may overly burden a more traditional system, which could reduce efficiency and increase labor costs. So make sure your software is still capable of delivering ROI within this new process.

Open a dialogue with your local parcel carriers

These are the people you’ll rely on to make Zone Skipping a success. Partnering with local carriers to design a Zone Skipping strategy is critical in making sure your plan will work. While a reduction in sorting/shipping on your part ultimately reduces the amount they can charge you, good parcel carriers will realize that the increased volume is a significant win on their end.

Zone Skipping with Varsity Shipping Software

Zone Skipping is an effective way to reduce shipping costs and improve customer experience. Discover all the ways Varsity multi-carrier shipping software can improve your parcel processes by scheduling a demo with one of our shipping specialists today.