Small Parcel Shipping Trends: Looking Ahead to 2020
As we approach the final days of 2019, now is a good time to look where the small parcel shipping industry has been this year — and where it’s likely headed in 2020.
The winds of change continue to blow through the industry, powered by the growing influence of technology and ecommerce. Add in the turbulence of Amazon continuing to aggressively build out its own delivery infrastructure, and 2020 is likely to be an interesting ride for shippers and logistics companies.
The following are seven top stories that have impacted small parcel shipping this year and whose effect will continue into 2020.
And now there are three
As we noted in our recently published, in-depth analysis of the UPS 2020 GRI, the carrier is using its SurePost service to align itself more firmly with the USPS. This is no doubt intended to put UPS in a good position in relation to Amazon’s moves into logistics. Read and download our report here (you don’t need to submit your email address … it’s completely free): Free Analysis: UPS 2020 GRI.
FedEx is also taking anticipatory steps to prepare for the growing logistical strength of Amazon by not renewing some of its contracts with the ecommerce behemoth. Read: FedEx split with Amazon continues as Ground contract won’t be renewed.
And of course, Amazon is continuing with its moves to become a logistics provider and compete with the big two. Read: Amazon Is Building a Delivery Service to Rival UPS and FedEx.
All roads lead to the customer
Consumers are taking advantage of a greater variety of ways to receive their purchases. Picking up their items in store is becoming more popular, and in response, many retailers are offering faster ways for customers to order online and get the products they want. This trend benefits retailers too. In-store fulfillment saves on many of the costs generated by inventory management, shipping, and managing fulfillment from centrally located fulfillment centers. Read: For a fast supply chain, Target is betting on in-store fulfillment.
For those customers who do want their packages delivered, a trend that we identified back in 2018 is continuing, with many retailers and manufacturers utilizing regional small parcel carriers to save money and benefit from faster transit times. Read (page 8): Can Your Lower Your Parcel Shipping Costs With a Regional Carrier?
Of course, no discussion of small parcel shipping trends would be complete without mentioning technology. Delivery robots and drones are coming! Read: Thousands of autonomous delivery robots are about to descend on US college campuses and Watch: Drone Delivery Around the World.
Get a tailwind behind you
Changes in customer demand, carrier competition, and technology are causing ever-faster change in the small parcel shipping industry. A McKinsey report shows that “riding the right waves of change, created by industry and geographic trends, is the most important contributor to business results … a company benefiting from such tailwinds is 4-8 times more likely to rise to the top of future performers.”
For you as a shipper or logistics professional, therefore, it’s important to remain diligent in understanding how your options (and costs) for delivery are evolving, so you can take early advantage of small parcel shipping trends to get a tailwind behind you.