RILA parcel and last-mile panel focuses on benefits of using regional carriers

By Jeff Berman, Group News Editor · February 28, 2020

Given the ever-increasing role that the intersection of e-commerce and last-mile logistics has in the retail supply chain, it does not come as a huge surprise that meeting ever-increasing consumer delivery expectations is a top challenge, especially for regional last-mile logistics players. That was a key theme at a session at this week’s RILA (Retail Industry Leaders Association) LINK 2020 Conference in Dallas.

John Janson, Director, Global Logistics, for SanMar Apparel, the lone shipper on the session’s panel, pointed to the Amazon effect and the pronounced impact it has had.

“Everything you order from Amazon is on your doorstep the next day or two days at the most,” he said. “That is kind of pushing the industry into later pickups, more flexibility, and the ability to make that delivery for either a B2B or B2C customer. It is not only having an effect on the regional marketplace, as the gap is also probably closing for national carriers. They may need to start thinking about being a seven day a week business, because if they are not offering that capacity it will go to somebody else.”

On the shipper side, Janson said not bracing for Amazon and its deep portfolio of delivery capabilities ended up costing some shippers that dismissed, or doubted, the impact the global e-commerce bellwether would eventually have.

“Those shippers said ‘we have a brand you cannot get anywhere else’…but one recently filed for bankruptcy and another was recently sold,” he said. “It really comes down to survival.”

Jason Lu, Head of Americas Logistics for Bloomberg, agreed with Janson, in that consumer expectations, for the time required from order to delivery, have gone up. Lu looked back at his time at Hello Fresh, a Web-based online meal services provider, which looked at time in transit as a competitive advantage to meet and exceed customer expectations.

That is on display in the ability to provide one-day service from Chicago to myriad Midwest locations, something that Dave Meyers, Vice President, Sales, for United Delivery Services, says is a key benefit for his customers.

“That is a huge advantage for us in order to provide more delivery solutions for shippers,” he explained. “And that means we don’t have to rely on express services, unless we have to on a Saturday. It is really about providing more delivery services and options for shippers.

The session also took a look at what are viewed as key benefits of using regional, last-mile providers.

SanMar’s Janson explained that saying all regional last-mile carriers are the same would be a misnomer, as certain providers match up better with certain shippers, depending on size, scale, and scope, among other things.

And Bloomberg’s Lu said cost, flexibility, and service each play a significant role.

“It comes down to finding a partner…and taking time to invest in a strategy, with a focus on saving money and reducing transit time,” he said. They need to commit to the strategy and to each other and be able to manage the relationship and move forward in a positive way.”

Looking at the ongoing impact of e-commerce on last-mile operations, Mark Magill, Vice President, Business Development, for OnTrac, pointed to how FedEx recently stated that current e-commerce volume could double over the next seven years, which he described as intense.

“Someone has to deliver all of those packages,” he said. “If you view the alternatives for the folks that do it correctly and with the right technology, you can be successful, but if anything goes wrong within a relationship, you can be handcuffed.”

February 28, 2020