Parcel - November 2008 - (Page 20)

trends REGIONALS: MORE SHIPPERS HIT THE GROUND RUNNING Economic crisis drives companies toward lower-priced alternatives By Ted Kauffman Y ou might say that the ground parcel industry has undergone a dramatic transformation in the last century. In 1914, in one of the earliest and most unusual ground deliveries, the parents of May Peirstorff in Grangeville, Idaho, wanted to ﬁnd the least expensive way to send their four-year-old to visit her grandmother 100 miles away. With no regulations to prevent such a delivery, they turned to a parcel post service, which shipped a 48-pound human package via rail cargo. Since then, industry changes have included regulation, globalization, technological advances, e-commerce, economic volatility and ever-ﬂuctuating consumer demands. Throughout this time, companies have weighed the options of multiple carriers that offer multiple services. Today, this multi-billion-dollar industry includes the United States Postal Service (USPS) and national and regional carriers that provide sameday, overnight and deferred services via air or ground transport. (Other services like LTL/truckload, rail and barge aren’t considered “mainstream” business alternatives due to their much slower transit times.) Over the years, what hasn’t changed is the need to deliver goods in a timely and cost-effective manner. Regardless of economic conditions, a long-held perception has been that the best-known national carriers provide the most reliable service—at least that is what has been instilled in many consumers’ minds through relentless advertising efforts. This branding has often led to knee-jerk decisions to ship parcels with the industry goliaths via overnight air. Today, however, change is deﬁnitely “in the air.” Due to the credit crisis and high cost of fuel, a new paradigm is evolving—and less expensive ground products are becoming more popular shipping solutions. A recent report by Morgan Stanley indicates that ground revenue has grown at three times the rate of air revenue from 1999 to 2007. This coincides with another compelling statistic: fuel prices are up roughly four-fold since 2003. While www.PARCELindustry.com 20 November 2008 http://www.PARCELindustry.com

Table of Contents Feed for the Digital Edition of Parcel - November 2008

Parcel - Novembr 2008 Contents Editor's Note What Would Augello Say? Best Practices Survey Results Are You Managing Your Parcel Network? How to Create Shipping Profit Centers Regionals: More Shippers Hit the Ground Running Handling Product Returns PARCEL Forum Continues to Deliver the Goods Product Profile On the Mark New Products & Services Advertiser Index Wrap Up

Parcel - November 2008

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