Riverstone Logistics’ Post

Parcel carrier diversification is evolving. After winning non-stop volume from the FDX and UPS supply during the pandemic, the regional parcel carriers’ volume grab is stalling out. Here’s some reasons why: 1. The number one thing that makes it impossible for many brands to work with various regionals: the cost of line haul to inject into a regional network is too expensive Why? LTL carriers can’t get it there on time. They don’t guarantee delivery times and can’t make critical sort times. So you’re almost guaranteed to have to pay for an FTL even if you don’t need all 26 pallet positions To combat this, regionals are investing in their middle mile now to lower their cost to pickup from shippers. Some of the biggest advantages UPS and FDX have up against regionals are their connected sort centers and highly-dense intra freight networks to facilitate low cost pick ups and movements within their network - AKA their middle mile. 2. Pricing leverage from concentration: The nationals have begun offering aggressive discounts to take over larger shares of a shipper’s network. It’s working. But there’s going to be newer types of carrier diversification ignited from this too. Now we’re going to see more shippers mix and match middle mile providers to zone skip within FDX and UPS networks for lower costs and higher service qualities. We’ve already seen a significant increase in intra carrier diversification being deployed for high volume W/:\RP shippers. We ultimately think working with regionals is worth the squeeze for better time in transits and lower costs in many scenarios. However, you have to pick the right diversification mix for you and your network. Learn more on how W/:\RP can help you navigate your parcel injections to enable the perfect carrier diversification mix for your network: https://lnkd.in/gqW5QPMy  #middlemile #ecommerce #freight #innovation

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