To the casual observer, North
America’s giant express carriers—namely UPS and FedEx—seem to have it all.
America’s giant express carriers—namely UPS and FedEx—seem to have it all.
They devote hundreds of millions of
dollars to purchasing the latest transportation assets and
information systems, and offer just about any service imaginable
today to the shipper, from parcel and less-than-truckload to air and
ocean freight forwarding and customs brokerage. They are the most
recognized brands among the general public today when it comes to
moving goods, and people will generally pay a premium, although not
always happily, for one of these two entities to handle their
shipments.
dollars to purchasing the latest transportation assets and
information systems, and offer just about any service imaginable
today to the shipper, from parcel and less-than-truckload to air and
ocean freight forwarding and customs brokerage. They are the most
recognized brands among the general public today when it comes to
moving goods, and people will generally pay a premium, although not
always happily, for one of these two entities to handle their
shipments.
However, they’re not invincible.
With the increasing emergence of e-commerce—buying items online and
having them primarily delivered to one’s doorstep instead of
getting them at the store—UPS and FedEx have both experienced their
share of service blunders. That became apparent in a most public way
once again around the 2015 Christmas holiday shopping period, when
the two express carriers in certain markets quite frankly choked on
the amount of volume of packages being pushed through their
transportation channels, resulting in missed delivery windows and
unhappy customers. With the mild winter so far around most of the
country, UPS and FedEx couldn’t blame that for the
shortcomings.
The increasingly frustrated mega-online retailer
Amazon wants to reduce its reliance on UPS, for example, by entering
the freight transportation and logistics services business itself.
Rumors are swirling that it plans to buy a French parcel delivery
company this spring. It’s uncertain how far Amazon will go with
adding freight delivery services to its expansive retail operations,
but the point is there are certain services and cost aspects about
using express carriers that the company clearly doesn’t like and
wants to change.
With the increasing emergence of e-commerce—buying items online and
having them primarily delivered to one’s doorstep instead of
getting them at the store—UPS and FedEx have both experienced their
share of service blunders. That became apparent in a most public way
once again around the 2015 Christmas holiday shopping period, when
the two express carriers in certain markets quite frankly choked on
the amount of volume of packages being pushed through their
transportation channels, resulting in missed delivery windows and
unhappy customers. With the mild winter so far around most of the
country, UPS and FedEx couldn’t blame that for the
shortcomings.
The increasingly frustrated mega-online retailer
Amazon wants to reduce its reliance on UPS, for example, by entering
the freight transportation and logistics services business itself.
Rumors are swirling that it plans to buy a French parcel delivery
company this spring. It’s uncertain how far Amazon will go with
adding freight delivery services to its expansive retail operations,
but the point is there are certain services and cost aspects about
using express carriers that the company clearly doesn’t like and
wants to change.
Most retailers, even many big name
brands, don’t have the internal wherewithal to internalize their
freight transportation and logistics management, as they perhaps once
did many years ago before third party services providers took over
much of these activities.
brands, don’t have the internal wherewithal to internalize their
freight transportation and logistics management, as they perhaps once
did many years ago before third party services providers took over
much of these activities.
Yet, retailers are just as much to
blame for the service failures experienced with the express carriers
during the end-of-the-year holiday season. The fact is that tidal
waves of freight being funneled through finite systems can cause even
the most sophisticated transportation service provider to choke. UPS
and FedEx, and even the U.S. Postal Service, did a noble job handling
these volumes. But it doesn’t have to be this way.
blame for the service failures experienced with the express carriers
during the end-of-the-year holiday season. The fact is that tidal
waves of freight being funneled through finite systems can cause even
the most sophisticated transportation service provider to choke. UPS
and FedEx, and even the U.S. Postal Service, did a noble job handling
these volumes. But it doesn’t have to be this way.
As e-commerce continues to take a
larger portion of retail sales and drive more freight into the
domestic transportation system, these waves of holiday packages will
only get larger and more difficult to handle. That’s why it’s now
more important than ever during the off-holiday periods for retailers
to develop secure ways to more efficiently share shipping forecast
data with their largest service providers, such as UPS and FedEx. If
these companies have a clearer idea of what may be coming from their
biggest customers, then they can devote the necessary resources to
eliminate former and future service hiccups.
larger portion of retail sales and drive more freight into the
domestic transportation system, these waves of holiday packages will
only get larger and more difficult to handle. That’s why it’s now
more important than ever during the off-holiday periods for retailers
to develop secure ways to more efficiently share shipping forecast
data with their largest service providers, such as UPS and FedEx. If
these companies have a clearer idea of what may be coming from their
biggest customers, then they can devote the necessary resources to
eliminate former and future service hiccups.
The knock-on effect of efficient
shipment data-sharing is clear—happy retailers and transportation
service providers, and most importantly, happy customers, means a
happy holiday season for all.
shipment data-sharing is clear—happy retailers and transportation
service providers, and most importantly, happy customers, means a
happy holiday season for all.
