Consumers return to in-person shopping, but entrepreneurs prepare for e-commerce to stay

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When jewellery designer Chantal Mittag discovered that a custom engagement ring she’d couriered never reached her client, she immediately began sleuthing. According to Fedex, the sorely missed package was signed for by a building concierge at the address Mittag provided; an impossibility, since the ring’s destination was a house, not a condo.

“It was delivered to a different house and signed for by someone who wasn’t a resident of the address,” Ms. Mittag recalls. “It took three days to find it. Meanwhile, my client’s father went knocking on doors around the neighbourhood, asking about the package. Eventually, Fedex sent the driver to go get it back.”

Throughout the pandemic, small business owners like Ms. Mittag learned to manage the financial and reputational challenges of shipping goods via courier systems under severe strain. Two years later, consumers’ enthusiasm for online shopping persists, forcing entrepreneurs and their shippers of choice to iron out pandemic-era challenges for good.

“During the height of the pandemic, our predicted growth over five years happened in six months,” says Purolator’s marketing director Stacey Cummings. “There were definitely slowdowns in the shipping process along the way that we’re seeing level out now.”

Today, businesses like Fedex, Canada Post and Purolator are back in more predictable territory, partially due to fewer parcels being sent via courier and mail services. Though many Canadians are still partial to online shopping, the reopening of bricks-and-mortar stores has taken some pressure off of delivery systems. A high rate of vaccinations and lower rates of COVID-19 at shipping facilities have also improved the flow of goods through warehouses.

“We’re seeing stabilization in volume patterns today, but the new normal will be constantly changing with shifting patterns of behaviour,” Ms. Cummings explains. “With more e-commerce businesses and more consumer adoption of tech, patterns could shift again. We’re quite behind with tech-enabled purchasing patterns in Canada versus other countries.”

In 2020, Statistics Canada reported 82 per cent of Canadians shopped online, up from 73 per cent in 2018, spending a total of $84.4-billion, with 76 per cent reporting they purchased physical goods, as opposed to software or services. That’s where the challenges with shipping to consumers began – 38 per cent of respondents said they received their goods later than indicated at the time they placed their order.

“For us, the majority of packages that are feared lost don’t permanently disappear,” says Julie Yoo, owner of I Miss You Vintage Inc., a luxury consignment shop in Toronto. “We have had delays [shipping packages] that were eventually able to be located and ultimately delivered.”

For Ms. Yoo, the pandemic didn’t cause any increase in missing shipments. She was able to weather the surge of online business when her storefront closed, partly thanks to resources from the software platform she employed to host the digital incarnation of her physical boutique.

“Our Shopify order system sends tracking information to our buyer, so they can monitor [their purchase]. We haven’t had any issues tracking shipments, as most tracking numbers update regularly and are easy to monitor online.”

According to Ms. Cummings, Purolator is still experiencing a higher number of shipments than they were before the pandemic. Conversely, Canada Post reported a decrease in revenue during the first quarter of 2022, attributable mainly to a decline in the volume of packages being shipped, which dropped by 23 million pieces, or 23.1 per cent, compared to the year before when most physical stores were closed due to the pandemic.

For Ms. Yoo, the cost of Canada Post’s services pushed her to explore other shipping options.

“I have strong feelings on the high cost of shipping and insurance with our national postal service. The rates are incredibly high compared to other postal services, and it’s a major disadvantage for Canadian small businesses selling online. We can’t stay competitive on the international market.”

A challenge Ms. Yoo and Ms. Mittag continue to face is making sure packages are being left in the right hands. Most shipping services charge an additional fee for obtaining a signature upon delivery, but both entrepreneurs say packages are often delivered without being handed directly to the recipient, so they’ve put strategies in place to mitigate losses.

“We regularly sell and ship high value goods so secure delivery is a priority for us,” says Ms. Yoo. “During the pandemic Canada Post was not obtaining signatures even though they were charging for the service. We found ourselves paying higher rates to courier companies like FedEx or DHL and upgrading at our cost to a faster service standard, so the items would have the shortest possible transit time and therefore less opportunity for loss.”

For Ms. Mittag, the concern is that packages containing precious stones or sentimental artifacts could be left on her doorstep.

“There have been many times that I require a signature with a ring that’s shipping back to me, and they’ll just drop it on my step, so that gives me anxiety all the time. Whenever I have a shipment arriving, I wait on Fedex. I’m chained to my house until they arrive, so I don’t have to live with the worry that someone is going to see the package left outside my house.”

These days, however, Ms. Mittag says delivery services are generally at, or even above, par.

“Canada Post feels back to normal now, to me. Even if something is sent as a two-day priority shipment, it sometimes arrives early, and that gets the clients excited.”