We all saw it coming. A surge in online demand, Covid workplace restrictions, and an unwillingness for the USPS to ramp up capacity during the pandemic. Fedex and UPS were all over customers confirming schedules, max deliveries, and raising rates for the holidays. USPS did raise rates, but is clearly overwhelmed at this point and its getting uglier by the day.
This does not just impact USPS shipments. The Post Office is the “last mile” for some packages for every major carrier including UPS (Surepost), Fedex (Smartpost), and many Amazon orders.
How bad is it? Yeoman estimates that 20-30% of USPS packages that were shipped from businesses last week are not even scanned into USPS system. Worse, it appears that USPS is not scanning items as they move through the system. We have confirmed multiple reports of items not showing as scanned, but arriving at the end customer address.
We recommend that you take the following steps immediately
- Stop shipping packages via USPS including overnight
- Do not start using them again until you see tracking info on your existing packages. That will be the easiest way to confirm if your local shipments are moving.
- We estimate this will be at least two weeks
- For Fedex and UPS, do not ship any Ontrac, Smartpost, or Surepost. It will likely be the same 2 week time period
- Visit your local post office
- Meet with the postmaster and discuss their current backlog. They are typically very upfront and can let you know their current backlog
- Huddle the finance team and figure out the critical 'refund, recall, and discount' numbers you can live with.
- Work with your Customer Service team to create an action plan for communicating to your online customers, especially for Amazon orders.
Managing your Amazon customer service is going to be extra critical for you. There's a lot of flexibility with your own site, but Amazon can shut down your operations if you fail to meet their performance metrics. All Amazon merchants know that the two big shipping metrics to watch are Late Shipment and Pre-Filled Cancellation Rates, but most never look at “Order Defect Rate.”
That’s a little-discussed customer service metric that requires you stay below 1% of defects. There are two types of defects that are going to spike:
- Negative Feedback: If a customer complains about your shipping
- A-Z Claim: When a customer goes directly to Amazon and says they want a refund
These are both likely to spike due to this USPS issue. Yeoman’s clients have seen multiple messages from customers that are frustrated that their package is showing as shipped, but there is not tracking info available. Customer’s don’t realize that USPS isn’t scanning and they will blame you.
Yeoman recommends responding to all messages immediately with the following approach.
First Customer Message:
Look up the tracking number for USPS and
- Enable alert tracking on the packages in question, have it text (or email) your Customer Service team.
If the tracking number is not showing as scanned provide a message that includes these points:
- “Thank you for the note and we certainly understand your concern. As you may have heard, USPS is currently overwhelmed with the volume. Your package shipped USPS Priority Mail on XX. We met with the local postmaster and confirmed that they have not been scanning packages consistently when they are picked up or as they moves through their system. We have had some customers receive packages that were never scanned at all from pick-up to delivery.
- This is very frustrating for all of us. Your package is in the USPS pipeline but they are unable to give a status. We are unable to pull the package back from them but do expect it to arrive before the holidays (NOTE: Only if your team estimates it can)
- We will continue to monitor your package and let you know as soon as we find out. I apologize for this issue. USPS Priority mail is normally only XX days to your location."
If the tracking number is showing as "scanned and in transit":
- “Thank you for the note. As you may have heard, USPS is currently overwhelmed with the volume. Your package shipped USPS Priority Mail on XX. The package currently is XXXX.
- This is very frustrating for all of us. Your package is in the USPS pipeline but they are overwhelmed even with Priority Packages. We know it will arrive, but can’t tell if it will arrive before the holidays
- I apologize for this issue and will let you know if we hear of any changes.
Second Customer Message: You can expect replies from the majority of customers, and you should restate status and provide any updates according to your standard policy.
Third Customer Message: If the customer replies negatively or continues their inquiries, consider an approach that offers options for a return or discount. Your Finance team should weigh-in on the margin impact and you’ll need an approval process, but the messaging would be similar to the following:
- "Thank you for the note. We are continuing to try to get updates, but USPS continues to be overwhelmed. We confirmed with our local Postmaster that all packages are picked up, but they are having delays.
- I’d like to offer you two options:
- XXX% Discount: USPS will not refund the postage for delivering the Priority package late, but we’d like to offer you a XXX% refund at our expense for the delay.
- Refund the order: The package will eventually arrive but we can offer you a full refund now. You’ll just need to leave the package closed, and Amazon will issue you a return slip so you can send back the package once it arrives. We’ll refund an additional XXX% for the hassle of sending it back. (Amazon allows a max of $20 additional refund on most orders)
- Hopefully the package will arrive on time but I’d like to give you these options just in case. Please let us know your thoughts."
If a customer agrees to either option, you’ll need to confirm that via Amazon messaging within your merchant portal and work with your Accounting team to process the discount or return.
The next few weeks will be bumpy for your customer service team so make sure you give them support and the flexibility they need. The pandemic bump to ecommerce is definitely going to take a hit with this surge, but being proactive with the customer base and providing clear and empathic communications will help you well beyond the holidays.
Stay Safe and Happy Holidays from the Yeoman Team