Retailers are aggressively implementing omnichannel shipping strategies to fulfill orders from inventory located in closer proximity to their customers. They are shipping from fulfillment centers, stores, 3PL warehouses, and suppliers to achieve faster delivery at reduced shipping costs. And, increasingly, they are using alternative delivery services, including local carriers, to do it.
Harnessing Local Carrier Resources for Value-Added Delivery
For years, large e-commerce marketplaces have been stoking consumer expectations for free, faster (now same-day), and reliable delivery. With consumers buying larger and more complex goods such as furniture, appliances, and exercise equipment, it’s not unusual for e-commerce merchants to offer same-day delivery as well as white glove services, such as over-the-threshold setup and waste removal. No more dropping stuff off at the end of the driveway.
Global, national, and regional carriers have traditionally serviced shipper needs very effectively, but now product-specific delivery services are becoming part of the e-commerce merchant’s brand. According to an IBISWorld report, there are more than 500,000 businesses in the global courier & delivery services industry with more than 2,819,000 employees. They use a wide range of vehicles that defy conventional ways of thinking about transportation modes; in other words, they employ whatever it takes. Bicycles, cars, parcel vans, flatbed trucks, and freight delivery vehicles are now being enlisted to meet consumer expectations. Robots and self-driving vehicles are already in the plans.
Enter the Last-Mile Intermediaries
Managing this cacophony of transportation service will not be for the faint of heart. It takes technology, transportation management expertise, boots on the ground, and a constant vigilance to ensure deliveries happen on time and seamlessly. Many traditional transportation companies are entering the fray. Global parcel carriers are offering metro services, while traditional freight carriers are starting to look more like parcel carriers making single shipment residential services but using local contract carrier to complete value-added deliveries.
Increasingly, 3PLs are jumping on the e-commerce bandwagon, managing national networks of local delivery services to make residential deliveries.
Private Carrier Networks Will Differentiate E-commerce Brands
Retailers and e-commerce merchants will no doubt be seeking to build out their own proprietary networks as a way of differentiating their brand. It is well known that shipping and returns are leading factors in shopping cart abandonment. How these businesses deliver is as important (and sometimes more important) that what they are delivering. And with e-commerce trends indicating faster growth outside of domestic borders, shippers are going to have to transform their logistics strategies or risk extinction.
The days of shipping systems as a point solution are drawing to a close. Shippers need access to an expanding global network of local carrier services in a way that will enable retailers, e-commerce merchants, and 3PLs to compete in the new delivery paradigm.
For more than 25 years, Bob Malley has helped thousands of businesses reduce transportation costs and streamline fulfillment with parcel TMS technology. As founder of Tracer Research, Inc., and later as Kewill CEO, Bob introduced Clippership, one of the first integrated multi-carrier shipping systems. As managing director of Pierbridge, Bob has built a global organization that continues to innovate Transtream, an enterprise-class parcel TMS platform. For more information on how to get ready for the new world of local carrier delivery, download our eBook, “Omnichannel Retailers Delivering from the Endless Aisle.”