Looking back, 2021 was a year that was as successful as it was challenging.
The ecommerce industry continued it’s boom as online sales made up ~20% of total retail sales during the year, and online holiday sales were reportedly up 11% (a 61% increase over 2019!). Under the DCL Logistics roof, year-over-year order volume grew by more than 50% which exceeded our expectations.
The challenges were new and difficult to navigate. The labor shortage affected many industries, but particularly ours which is built on operators moving goods from place to place. Supply chain issues made major mainstream headlines as shipping delays, port congestion, and material shortages created major ripples.
The good always seemed to come with a challenge. At DCL our customers saw massive growth from the ecommerce boom, but also heavy backorders from supply chain constraints and unprecedented demand. We saw transit times even out across the industry as carriers adjusted to the overall capacity constraints, yet there were more surcharges and a few big bumps in transportation.
As we head into a new calendar year with another strong (albeit very busy!) holiday season behind us, it feels like we’re all still trying to adjust, trying to find some sense of normal. At DCL we have leaned on our agile culture. We’re adapting to the constant and unforeseen changes that have become the new normal. We understand that as an important supply chain partner to many high-growth brands we must look beyond how we execute today, that it takes understanding, empathy, and collaborative communication to truly support our customer’s business in the long run.
To keep up with demand and continue our commitment to dedicated customer support, we have invested in specific areas of our business. These are the aspects of this growing, changing ecommerce-driven industry that we believe will push us forward into another successful year. Here are the adjustments we’ve made and how we see them bridging our customers’ growth in 2022 and beyond.
More Automation for Increased Order Volumes and Capacity
The use of robots in the warehouse was a big topic in 2021 as the COVID-19 pandemic accelerated the proliferation of many types of warehouse automation. Workers needed to be physically distanced to protect against the spread of COVID-19. The ecommerce industry’s boom continued to surge, requiring a higher throughput of orders. The use of conveyance and robotics filled these gaps, and created stability where the labor shortage left an inconsistent workforce.
At DCL, all of our warehouses are now outfitted with automated conveyance, which immediately allowed us to support increased capacity. This gives us the ability to scale quickly and offset the continued rise in labor costs.
Enhanced Freight Detail for Greater Clarity of Shipping Costs
We upgraded our shipping platform with a more extensible, API-based infrastructure. It will enable a simpler rollout of new features and greater flexibility when it comes to adding alternative carriers such as Passport (International), WeShip (domestic private carrier network) and Pitney Bowes (parcel carrier).
We are always looking for ways we can give our customers the data and resources they need. We enhanced our shipping and freight details to include more precise shipping costs upfront, and more detail in the makeup of those shipping costs. Detailed shipping costs have become increasingly more important as carriers continue to add surcharges frequently which now make up a material portion of most company’s overall shipping costs.
Expanding Internationally for More Shipping Options
We recently added Passport, an international shipping carrier for DTC brands with high-touch customer support and integrated duty and tax calculator. This is only the start of our plans to add more international shipping options this year and beyond. With global reach more important than ever, DCL customers now have the option to cost-effectively ship internationally directly out of our facilities.
Expanding to the Northeast for Faster Shipping to More Regions
Fast shipping is now part of the new normal. Giving our brands a competitive advantage in the market means keeping up with these new standards.
One of our biggest announcements is the opening of a sixth facility to our national footprint of warehouses. York, Pennsylvania will be our new East Coast hub. With this addition we will be able to give our customers faster shipping to more urban areas including next-day ground to New York City, two-day ground to Florida and everywhere in between. We expect to be operational by the early summer.
Investment in People to Continue Dedicated Customer Support
The logistics and fulfillment industry is still largely operated by manual labor. In 2021 warehouse, trucking fleets, ports, and manufacturing sites were greatly affected by the shrinking workforce. This was particularly difficult to navigate as online shopping only rose, sending order volume for most companies higher and higher each month.
At DCL we doubled down on our investment in our employees, raising wages and putting an aggressive plan in place to bring on more full-time employees at all levels—from warehouse workers to middle management to leadership positions. We know this will provide our customers with more stability and a higher quality service.
In 2021, despite the labor shortage, we nearly doubled our team across all departments and levels and improved our systems to keep our workforce healthy. As part of our effort to bolster our technology and security infrastructure, our VP of Technology, Craig Watson, will now be leading two departments: Automation and Infrastructure.
Looking Ahead to Scale and Grow
It took creativity and flexibility for most brands to make it through the beginning of the pandemic. Reflecting on the last two years, it’s clear that the DCL roster of brands has incredible perseverance and stamina. In the 40 years that DCL has been in operation, we’ve seen how much resilience this business requires. 2021 was one of the toughest.
The team at DCL is committed to being a partner that brands can scale with. Let’s knock 2022 out of the water!