28 DC VELOCITY JUNE 2019 www.dcvelocity.com
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percent of retail purchases this year,
will grow to 20 percent in 2025. All
of which continues to drive package
and parcel volume.
“More customers in retail and
manufacturing are demanding faster
delivery times,” said David Abney,
UPS chairman and chief executive,
in the company’s first-quarter 2019
earnings call. Among the innova-
tions UPS has introduced recent-
ly is UPS eFulfillment, a program
that supports SMB (small and medi-
um-sized) shippers that sell across
multiple marketplaces and Web
stores. The program includes a tech-
nology platform that connects users to 21
marketplaces via one UPS login, as well as
the physical fulfillment services—storage,
order fulfillment, packaging, and ship-
ping—for those orders.
This and other innovations UPS has
planned “are about giving our small and
mid-sized customers a platform to really
punch above their weight,” Abney said in
the earnings call. “It allows these smaller businesses to actually compete with
larger e-tailers but without having all the
infrastructure and the costs that would
burden them. It’s a big focus of our SMB
imperative,” he added. UPS is actively
partnering with e-commerce platforms
such as Shopify, Shoprunner, Inexption,
and Ware2Go.
FedEx expects the U.S. parcel market
alone to double in size to more than
100 million packages per day by 2026,
with e-commerce a significant driver of
accelerating volumes. “When you view
the unprecedented growth opportunity
in our industry in the years ahead and
the very small number of providers that’ll
be able to address the opportunity, it
becomes clear why we are optimistic,”
says Scott Harkins, senior vice president
of customer channel marketing, FedEx
Services.
A FLUID MARKET
Competitive market dynamics, the time
of day when consumers typically order
goods, and their expectations for responsive parcel shipping services all continue to evolve. According to research by
marketing data and analytics company
Comscore, the majority of online orders
are placed after 4 p.m., and 64 percent of
shippers expect orders placed by 5 p.m. to
qualify for delivery the next day. Another
industry report estimated that, on average, retailers that ship from their stores
can achieve a 20- to 40-percent increase
in incremental e-commerce revenue and
a margin increase of 30-plus percent on
markdown items.
It’s a fluid market, and Harkins says
FedEx constantly tests and develops solutions to meet shipper needs as online platforms mature and customer demands—
such as how and when they want their
goods delivered—change. He cited the
