What is Big Data in the Parcel Shipping Industry?

Big Data in Parcel Shipping

For the last few years, players across the parcel shipping industry have been boasting about how they’ve harnessed “big data” to increase innovation and efficiency. They’ve been able to mine huge datasets about parcels, delivery times, customer satisfaction and even weather patterns for insights they hadn’t seen before. That information can guide companies to make decisions that cut shipping costs significantly.

But big data analytics is only helpful if it’s good data. There’s an old saying in statistics: “garbage in, garbage out.”

Every business that ships products should be collecting data in real time or as close to it as possible. Data can lift the veil on inefficiencies you didn’t realize your company had. And leaders can feel confident with data-driven decision making.

Big data is key to relevance in the parcel shipping and logistics industry. Below, is what you need to know to start using it.

What is “Big Data?”

Organizations have been collecting data and analyzing it with traditional tools, like Microsoft Excel, for decades. Big data means more than a lot of data. It’s a set of information that includes not only traditional metrics like parcel weights and zone distributions, but non-traditional information sources like text, video and satellite inputs. This could include camera footage from inside a warehouse, satellite data about freeway traffic or written customer reviews.

The volume of data available here can be daunting, especially if you imagine collecting it all in real time. That’s why your first step should be figuring out what question you want to answer. Do you want to understand how winter weather affected your holiday shipping last year? Do you think you can make transit more efficient?

Further, big data draws links between all aspects of your supply chain from your supplier to your inventory on hand, to your warehouses to your customers. This information can remind you when it’s time to order more replacement inventory because your stock is running low. It can reveal not only which of your vendors missed shipments, but also which manufacturers’ products got the best customer reviews.

Ultimately, big data is a powerful tool that can help you understand almost anything about your supply chain.

Related: Why Data Is Key To Successfully Managing Your Supply Chain

What is Good Data?

Remember, big data is useless if your inputs are weak. In other words, to make a data set worthwhile, you need information that meets certain standards, including:

  • A lot of information ideally gathered over a long period of time
  • Information about a number of different products, traveling different distances, using various modes of transportation
  • Data gathered in real time or soon after parcels are shipped, not retroactively
  • You need to be able to trust that your data is accurate

What makes data trustworthy? A lot of data will provide more insight than a little, because it minimizes the statistical impact of exceptions and outliers. A wide variety of data offers more information when it’s time to model the impact a new carrier or new contract would have. And the more quickly data is gathered, the sooner you can apply it to operations.

Further, what you collect needs to be consistent from day to day and month to month. If you suddenly start separating packages priced by dimensional weight from packages priced by actual weight, but forget to incorporate that into your calculations, you’ll get different and inaccurate outputs.

Finally, it’s critical to double-check your units. Make sure all your packages are measured in either pounds or kilograms, but not both. The same goes for inches and miles.

Reveel can help your company start collecting data in real time about your shipments, including what you send, where it goes and how well your carrier performs. Our consultants then can help you decide what other information you need to turn good data into big data, and answer those key questions.

How Can Big Data Help my Company Save on Shipping Costs?

A data analyst looks at information with a totally different perspective than a supply chain manager. Reviewing numbers or other types of information if you’re working with big data, can reveal inefficiencies you’d never noticed. It can lift the veil on parts of your shipping profile where you’re spending too much money, and suggest contractual agreements that you could try to renegotiate. This can help you capture more market share and reduce your shipping spend almost immediately.

Not only does big data takes into account information like traffic jams, weather and even port strikes, it can do even more. It can help you quantify the impact of external events on your supply chain. And that can help you prepare contingency plans for the next time a similar event occurs.

Traditional data is retroactive, backward-looking. It’s extremely valuable for decisions that generate ongoing cost savings.

Big data can help you forecast, plan and secure huge savings in the future for your business.


The Reveel App uses AI and machine learning to provide an unparalleled look into what’s impacting your bottom line. Through invoice audits, peer benchmarking, and rate modeling/simulations, you can see the health of your operation and assess pricing changes from parcel carriers like FedEx and UPS. Sign up for a free Reveel account today to see how you can leverage automation to synthesize your data, ship more for less, and reduce the time needed to identify issues and action items. 

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