BY MARK B. SOLOMON, EXECUTIVE EDITOR–NEWS
OPTIMIZING FREIGHT SPEND
Strategy
NOWHERE IS IT WRI TTEN THAT ALL E-COMMERCE
deliveries must consist of symmetrical four-pound parcels. In fact, the focus of the online fulfillment saga’s next
chapter could be on items that don’t look anything like
what has come before.
Small, lightweight shipments handled through traditional conveyance systems have dominated e-commerce’s early days. But the broadening of online inventories now gives consumers
and businesses access to goods
of all shapes, weights, and
sizes. These include so-called
large-format items that weigh
more than 150 pounds and
usually require two people to
deliver and perhaps install,
as well as relatively light
but bulky products that are
incompatible with conveyors.
They could be skis, mattress-es, treadmills, or desks. Or
they could be furniture items
ordered on Seattle-based
Amazon.com Inc., the world’s
largest e-tailer, which recently
announced it would enter the
space.
U.S. online sales of noncon-
veyable goods have hit $30 bil-
lion, equal to about 10 percent
of total e-commerce sales,
according to Omaha, Neb.-
based truckload and logistics
company Werner Enterprises
Inc., which in May launched a service to deliver such
items the “last” mile to residences from stores, factories,
or DCs. For-hire last-mile deliveries of heavy goods
ordered online have grown at a nearly 9-percent com-
pound annual rate since 2012 and are now a $7.6 billion-
a-year business, said consultancy SJ Consulting.
E-commerce rewrote the rules for parcel carriers,
which had to adjust to business-to-consumer (B2C)
deliveries overtaking their traditional business-to-busi-
ness (B2B) market. The continued growth of large-for-
mat orders will rewrite the rules yet again, but this time
for multiple types of carriers. Parcel service providers
are expanding their physical networks in part to accom-
modate orders that can’t be
handled via conveyor. FedEx
Ground, the ground parcel unit
that handles the bulk of e-com-
merce deliveries for its parent,
Memphis, Tenn.-based FedEx
Corp., has added 10 million
square feet of capacity in the past
18 months, with four major U.S.
hubs and 19 automated stations.
Meanwhile, less-than-truckload
(LTL) carriers with minimal
exposure to residences and with
drivers accustomed to serving
docks will now be expected to go
into a home and work directly
with customers. And truckload
carriers, the biggest collective
players in U.S. shipping, will dive
in as e-commerce growth pro-
vides attractive levels of ship-
ment density centered around
major markets.
Kevin P. Knight, chief exec-
utive officer of Phoenix-based
Knight Transportation, which
will become the nation’s biggest truckload carrier
should its $6 billion merger with hometown rival Swift
Transportation Co. LLC win shareholder approval,
reportedly said on a recent analyst call that e-commerce
volume growth “has allowed truckload to be in the game,
Almost anything can be ordered online. That has helped spawn
a logistics ecosystem designed to deliver the big and heavy stuff.
Going heavy to the home
