Many businesses take their logistics for granted. How products move is usually an after-thought, secondary to the product itself. But certain events have the power to highlight the importance of logistics to the flow of every day life. Especially when those events can bring almost everything to a crashing halt.
The recent negotiations between UPS and the Teamsters union are a perfect example. In the United States, UPS moves over 20 million packages every single day. And the 340,000 members of the Teamsters union are the ones who make it happen. Right now though, the two sides are struggling to agree on a new contract. And that could have dire consequences for the rest of the shipping world.
The last time UPS workers went on strike was in 1997, over 25 years ago. Then, the UPS workforce was only half of what it is now, and e-commerce wasn’t even invented. Still, that 15-day strike cost UPS over $600 million dollars. It went on to damage every major sector in the country. Today, the ripple effects from a potential strike would be catastrophic.
Now that I’ve got your attention, I want to mention that even if a strike happens, it doesn’t mean you should lose all hope. There are things you can do to help mititgate the impact of a strike on your logistics department.
Here’s three for example:
- Talk to your carrier partners … All of them. Parcel, LTL, Truck Load, Mail Consolidator, if you have a rep, get them on the phone or in the office. Talk through all your options. Are they going to cap your volume? Will they continue to support your drop trailer? Will their cut off times move earlier? What are their plans for accepting new customers during this period, how ever long it may be? What extra fees should you expect? Even if the strike only lasts a week, the impact will last much longer.
- Talk to your fulfillment partners. For locations shipping more than one customer, how will they handle capacity limits? Do they have processes in place to rank which volume gets shipped first each day? How will they deal with earlier cut off times?
- Talk to your internal teams. Communicate the risks, and make sure they understand the implications. Look at your planned launches and be ready to pivot. You should be ready to update your shipping policies ON THE FLY. Get your team to put together a worst-case scenario SOP so you know which levers to pull when you need to pull them.
And finally, a personal piece of bonus advice: Get your back-to-school shopping done in July. No matter what happens, the kiddos are still going to need fresh gear.
I also want to mention that these are steps everyone should take. FedEx shippers, regional shippers, Fulfillment by Amazon customers, LTL shippers, everyone. A UPS strike will have a massive effect on every sector of the logistics and supply chain industries. Even if you don’t ship with UPS, you need to start planning for how the strike will affect the carriers you do work with. Because trust me, it will.
The bright side is, the advantages of putting plans in place now can be far-reaching. Having a resilient carrier portfolio will help you handle future black-swan events. Creating an adaptable team will help you survive the annual pains of Peak Season. And being confident in your logistics department will help everyone sleep at night.
Even if we do avoid a UPS strike this time around, they are not the only carrier having a tough time. At some point, things will go sideways. They always do. All the problems during the Pandemic showed us how vital shipping is the modern world. But they also showed us how fragile the industry can be. And that’s all the more reason we can’t take it for granted anymore.