Fulfillment and customer service vendor Radial is hiring extra temporary employees to help its retail clients meet online holiday shopping demands. The additional 20,000 seasonal staffers will nearly triple its current company head count of 7,000, says Stefan Weitz, chief product and strategy officer at Radial.
Radial, formerly known as eBay Enterprise, launched in April and provides its omnichannel software services to midsized retailers as well as the big retail chains that formed its customer base in the past.
Radial operates 26 distribution centers and six call centers in the United States, Canada and Europe. Over the next few months, Radial will add more than 20,000 additional workers in those centers in locations including Eau Claire, Wis.; Louisville, Ky.; Memphis, Tenn.; Groveport, Ohio; Mississauga, Ontario; Manchester, United Kingdom; and Halle, Germany.
The seasonal employees are starting now as Weitz says Radial’s distribution centers already are taking in inventory for the holidays, and workers will continue to start through October. Radial’s holiday workforce is at 25% bigger than eBay Enterprise hired in 2015, Weitz says. Most employees’ contracts will end in mid-January but a spokeswoman for Radial says some positions may turn into full-time roles.
Radial works with more than 70 online retailers for fulfillment services. Its retail clients include Fanatics Inc., No. 38 in the Internet Retailer 2016 Top 500 Guide, GNC Holdings Inc. (No. 166) and Toys R Us Inc. (No. 35).
“Many” of Radial’s retail clients are forecasting a 10% or greater year-over-year increase in holiday web sales, Weitz says, though he declines to be more specific. The National Retail Federation in July forecast online and other nonstore sales to increase 7-10% in 2016, up from an earlier estimate of 6-9%.
Weitz says Radial communicates with its merchants on a weekly and sometimes daily basis to forecast order volume, and those discussions ramp up as the holidays approach. “For the holidays it is a balance of communication, art and science,” Weitz says, regarding planning for the peak holiday fulfillment season. “When we wanted to get more detail for peak we asked what clients have seen over the year and we looked at what we could expect given their current volume for the year. We sat down with merchandise planners to discuss the products they think are going to be hot, and we discussed what they were planning from a promotion and product standpoint.”
Radial is recruiting new employees through local online and print advertising, and the workers fill a variety of warehouse roles from receiving shipments and breaking down pallets to picking, packing and gift wrapping orders, Weitz says. He won’t say how much Radial is paying seasonal staff except that the rate is competitive for each market.
“Holiday is prime for discovering the extent to which Amazon has shrunk the remaining share of the consumer’s wallet that all other retailers have to fight over,” Weitz says. “It’s a reminder that the rise in consumer demand is surpassed only by the risk of retailers failing against Amazon. Time is running out: Retailers need to seriously consider how they offer customers choice, convenience and control. And it means more than just front-end aesthetics. It’s about having adequate back-end muscle to deliver a truly world-class customer experience at scale—post-checkout—for the holidays and beyond.”
As of late 2015 eBay Enterprise (now Radial) served 523 of the Top 1000 global online retailers, according to the Internet Retailer Vendors to the Top 1000, a 21% increase from a year earlier. The combined 2015 web sales of those 523 retailers is $134.6 billion, according to Internet Retailer estimates.
While Radial is helping its merchant clients meet warehousing demands such as picking, packing and shipping orders in a timely fashion during the holiday rush, retailers also need to manage the final leg of transactions—delivery. That’s why planning and clear, frequent communication before and during the peak season between e-retailers and their delivery carriers is critical. At AccessoryGeeks.com (No. 839), which handles most of its own fulfillment, those conversations started internally in July, and get more earnest in late September and early October. That’s when the e-retailer of smartphone accessories and small electronics makes appointments with its shipping representatives at DHL, UPS Inc. and OnTrac Inc. to go over its seasonal forecast and associated shipping requirements.
“We look at the previous years’ performance, and if situations arose where there were delayed shipments to certain states,” says David Byun, president of CGETC Inc., Accessory Geeks’ parent company. “We have a conversation about how we are going to handle the holiday season.”
For most shipments departing from its 22,500-square-foot Los Angeles-area fulfillment center, AccessoryGeeks uses DHL Global, with final delivery by the U.S. Postal Service. The retailer also uses UPS for some shipments and OnTrac for shipments in that vendor’s eight-state coverage area. It uses Fulfillment by Amazon for orders placed on Amazon.com Inc., a fast-growing part of its overall shipping volume.
UPS says it began reaching out in July to e-retailers that ship more than 5,000 packages daily to learn about their planned holiday promotions and shipping volume projections, including the size of packages. As the holiday season nears, UPS will be in daily contact with high-volume shippers so it can adjust how packages enter its network. It may, for example, recommend UPS pick up outbound orders on a Saturday or Sunday instead of waiting for Monday, when packages will have piled up over the weekend at e-retailers’ warehouses.
Newgistics Inc. says it requests initial forecasts from retailers between July and September. It also talks to transportation providers to make sure enough trucks and drivers will be available to handle extra loads, and additional pickups and routes. Newgistics says peak season volume increased 15% in 2015, and the daily volume change from nonpeak to peak is about 50-60%.
E-retailers also must decide how late in the season they will take orders with the expectation that carriers will be able to deliver on time. UPS, FedEx Corp. and the USPS delivered 60 million packages on Christmas Eve 2015, according to estimates from ShipMatrix Inc., which tracked shipments from more than 1,000 retail shippers.