Sizing up Peak Season and the Parcel Market

August 26, 2021


John Haber, President of Transportation Insight’s parcel business unit and founder of Spend Management Experts which was acquired by Transportation Insight earlier this year, recently chatted with Jeff Berman, group news editor for trade magazine Logistics Management and the Peerless Supply Chain Group about the holiday peak season.

As the holiday peak season quickly approaches, Haber describes the current overall market best, “mayhem in the supply chain” by noting capacity concerns, driver shortages, and not enough infrastructure in capacity in the parcel marketplace.

“Capacity will be a major concern during the holiday season,” Haber told Berman. FedEx has been capping capacity, UPS has been shedding a number of its Enterprise customers as it focuses more on profits versus volumes, and several regional parcel carriers have already run out of capacity for the rest of the year.

“Shippers more than ever need to be looking at different strategies to mitigate capacity issues,” according to Haber. Looking beyond UPS and FedEx and understanding the different available options is important. Services such as zone skipping, drop shipping, and managing inventories effectively by having them at the right place (i.e. closer to customers) will allow shippers to utilize the many local couriers available.

Amazon, for example, has built a number of delivery facilities in urban areas, closer to customers, so that they can cherry-pick volumes in dense, urban areas. This is helping to further set the e-commerce giant up as a third-party delivery provider, something they were testing in certain geographic locations prior to the pandemic. The test was temporarily suspended but it is rumored that it will return and will eventually help balance out the duopoly of FedEx and UPS according to Haber.

While there may no longer be any available capacity from the regional parcel carriers for the upcoming holiday peak season, some such as LaserShip and LSO are expanding operations into new US states. Could we possibly see a network that links these carriers into a new national network to take on FedEx and UPS? Time will tell. One thing is for sure, the last-mile market is changing quickly with new entrants, new technologies, and more.

Be sure to check out John and Jeff’s full interview here.

 


ABOUT SPEND MANAGEMENT EXPERTS

Spend Management Experts has united with Transportation Insight to become North America’s #1 provider of small parcel management and optimization services.  Our team of best-in-class analysts employs cost modeling techniques to help clients optimize their supply chain spend, reducing costs by 20% or more.  Our approach is non-invasive to daily supply chain operations as we employ unparalleled market intelligence and proprietary cost modeling technology, targeting hidden costs and identifying savings opportunities. After establishing the success criteria, SME leverages proven project plans, data warehousing, and milestone documents to ensure an optimized and implementable solution. We build strong business cases based on your data to negotiate better terms, pricing, and service for our clients. We deliver your competitive edge.

Connect with Spend Management Experts on TwitterLinkedIn, and the Spend Management Experts blog.

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Sizing up Peak Season and the Parcel Market

August 26, 2021


John Haber, President of Transportation Insight’s parcel business unit and founder of Spend Management Experts which was acquired by Transportation Insight earlier this year, recently chatted with Jeff Berman, group news editor for trade magazine Logistics Management and the Peerless Supply Chain Group about the holiday peak season. As the holiday peak season quickly approaches, Haber describes the current overall market best, “mayhem in the supply chain” by noting capacity concerns, driver shortages, and not enough infrastructure in capacity in the parcel marketplace. “Capacity will be a major concern during the holiday season,” Haber told Berman. FedEx has been capping capacity, UPS has been shedding a number of its Enterprise customers as it focuses more on profits versus volumes, and several regional parcel carriers have already run out of capacity for the rest of the year. “Shippers more than ever need to be looking at different strategies to mitigate capacity issues,” according to Haber. Looking beyond UPS and FedEx and understanding the different available options is important. Services such as zone skipping, drop shipping, and managing inventories effectively by having them at the right place (i.e. closer to customers) will allow shippers to utilize the many local couriers available. Amazon, for example, has built a number of delivery facilities in urban areas, closer to customers, so that they can cherry-pick volumes in dense, urban areas. This is helping to further set the e-commerce giant up as a third-party delivery provider, something they were testing in certain geographic locations prior to the pandemic. The test was temporarily suspended but it is rumored that it will return and will eventually help balance out the duopoly of FedEx and UPS according to Haber. While there may no longer be any available capacity from the regional parcel carriers for the upcoming holiday peak season, some such as LaserShip and LSO are expanding operations into new US states. Could we possibly see a network that links these carriers into a new national network to take on FedEx and UPS? Time will tell. One thing is for sure, the last-mile market is changing quickly with new entrants, new technologies, and more. Be sure to check out John and Jeff’s full interview here.  


ABOUT SPEND MANAGEMENT EXPERTS Spend Management Experts has united with Transportation Insight to become North America’s #1 provider of small parcel management and optimization services.  Our team of best-in-class analysts employs cost modeling techniques to help clients optimize their supply chain spend, reducing costs by 20% or more.  Our approach is non-invasive to daily supply chain operations as we employ unparalleled market intelligence and proprietary cost modeling technology, targeting hidden costs and identifying savings opportunities. After establishing the success criteria, SME leverages proven project plans, data warehousing, and milestone documents to ensure an optimized and implementable solution. We build strong business cases based on your data to negotiate better terms, pricing, and service for our clients. We deliver your competitive edge. Connect with Spend Management Experts on TwitterLinkedIn, and the Spend Management Experts blog.

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