Drop Shipping is the Easiest Way to Deliver This Holiday

By Frank Poore

If the chilly summer wasn't enough of a reminder, the holiday season will soon be upon us. There's no need to remind shipping companies, which have been prepping for Christmas since last year's delivery disaster, which resulted in missed delivery target dates and some not-so-merry customers. IBM Digital Analytics found that in 2013, the last holiday shopping weekend before Christmas saw 37 percent more sales than the year prior, which shattered UPS and FedEx estimates.

This year, anticipating an influx of last-minute, high-priority orders, UPS recently invested $175 million in a network upgrade that it believes will make delivery faster and more reliable.

With millions of Merry Christmases and Happy Hanukkahs on the line, it's important that omnichannel newcomers like Wal-Mart and Sears adjust for the effects of increased online shopping. One solution is for retailers to offer more products, while simultaneously ensuring faster delivery by transferring the shipping responsibilities to the manufacturer or supplier via drop shipping.

There are several benefits to drop shipping, providing the process is well managed with an integrated platform that efficiently connects retailers with their suppliers. Such platforms give retailers a single interface that allows them to manage their entire supplier network, including drop shippers, with a single, streamlined process. This eliminates fulfillment headaches and guarantees that drop shippers always follow a retailer's business process to guarantee a reliable and branded delivery experience.

By leveraging an integrated platform to manage suppliers and drop-shipping solutions more effectively, retailers can take advantage of the following benefits:

1. The ability to integrate any supplier: Retailers need their suppliers to effectively fulfill orders. Companies that use drop shipping can trust that an effective platform has the capability to integrate any supplier, regardless of their technical sophistication or system compatibilities. Effective drop-ship platforms should support the onboarding of suppliers through the entire process, including initial setup, testing and ongoing monitoring of the flow of transactions.

2. Real-time alerts and tracking: Equally important for retailers is "Big Brother" oversight of the marketplace. Being omnipresent means retailers must establish rules and alerts that monitor their third-party sellers, as well as provide real-time tracking of order status. An integrated platform oversees all drop shipping, allowing retailers greater control by improving visibility and management of shipping and fulfillment that's directly tied to customer service and brand reputation. Retailers should expect the platform to provide proactive visibility into fulfillment problems — and solutions — to prevent negative customer experiences.

3. Rapid shipping solutions: Shipping service levels should take into consideration factors like delivery window, inventory location and destination. Monitoring shipments closely lets retailers optimize deliveries. A good platform implements smart shipping procedures on the retailer's behalf. These calculate the best way to get every item delivered at the best price, expediting or upgrading shipments when necessary, and calculating when standard shipping options are timely enough.

Many retailers have already caught on to drop shipping as a fast, easy and secure delivery method and are turning to third-party platforms to connect with suppliers. However, if hiring an outside provider doesn't seem appealing, another option is to develop your own technology in-house.

With so many ways to implement drop shipping, satisfying spikes in holiday demand has never been easier.

Frank Poore is the CEO of CommerceHub, a provider of hosted integration, drop-ship fulfillment and product content management services.