The Hurricane marketing team recently caught up with Robert Dundas, Business Development Director, to talk about some of the big challenges and opportunities confronting the postal industry, in particular the exponential growth in cross-border eCommerce and a plethora of new regulations.
So, Rob, can you give us a bit of your background and how it lends itself to your role within Hurricane?
The last ten or so years of my career have been spent in the cross-border logistics industry with Skynet and Spring GDS (the cross-border arm of the Dutch post office). I then started my own consultancy business back in 2019, working with major e-retailers, looking objectively at logistics issues and creating the bespoke solutions.
During this time, how has the industry changed?
It has given me the chance to witness the rapid decline in traditional mail as more and more document traffic moved online, as well as the meteoric growth of eCommerce packet and parcel traffic, as retailers tapped into the commercial benefits of cross-border Postal solutions.
eCommerce has been somewhat of a saviour for the Posts as it has allowed them to weather the storm of a declining traditional market, the need for small (lower value) packets and parcels to be shipped domestically and worldwide gave them a lifeline they could not ignore.
Yearly research continues to prove this point, as cross-border eCommerce has meant that by 2025 there will be 200 billion parcels shipped a year.
This obviously represents a fantastic opportunity for Posts, but does it also bring risks?
The challenge for Posts is adapting their solutions to handle large volumes of low value parcels, which up until now have been allowed to move across borders with relative anonymity.
Recent regulatory changes such as the US Stop Act and the introduction of ICS2 in March 2021, has meant that these low value parcels will now be required to have an electronic data set sent with them.
Think of it like a person travelling with a passport. Without it, you are not allowed to travel to another country, the same applies for parcels which without electronic data entry into your destination country will be delayed or blocked.
How can Postal Operators manage this need for electronic data when dealing with such a high volume of parcels?
Over the last few years we have seen a dramatic shift in the workload being automated rather than being completed manually. This will be no different, to efficiently complete data sets, Posts will need to utilise technology to stay competitive and improve their value offering.
With the introduction of AI especially, data sets can now be completed and sent to the importing customs authority in a matter of minutes ensuring goods will arrive in country unhindered, or flagging early issues such as restricted or prohibited items or denied parties.
Why is it so important to have an effective and efficient solution in place once these regulations are enforced?
e-retailers live or die on the quality of their customers’ shopping experience and shipping and delivery is an important element of this. Postal Operators need to apply intense focus on their service offering if they wish to protect their market share. Integrators and couriers are waiting on the side lines to pounce on the SME eCommerce market, therefore Posts need to ensure they are prepared for compliance changes.
Ensuring accurate data sets are tied to their shipping is going to be vital in delivering shipments in line with their service commitments and protect the relationship they have with their customers. Failure to do so may result in problems with shipments, affecting transit times and the overall customer experience. The result may be their customers moving to direct competitors.
With ICS2 and other regulations coming into effect in early 2021, what is the timeline for Posts to ensure they are prepared?
Realistically, Posts only have 3-4 months to integrate, test and implement a solution into their service. We are living in unique times and with the build-up to Peak 2020 only months away, now really is the time to start preparing for compliance changes coming into effect in 2021.
However, Posts which successfully prepare will not only cement their position in the market but will be able to grow their business.
Hurricane has 2 unique SaaS based solutions utilising AI and APIs to help Posts calculate duty and taxes, screen their shipments for prohibited and restricted goods, denied parties and ensure that all their data is compliant with importing customs regulations to take advantage of fast track customs lanes.
Easy to integrate and simple to run, Hurricane is a fantastic opportunity for any Post to be prepared for changes and grow their business.