DC Velocity - June 2020

24 DC VELOCITY JUNE 2020 www.dcvelocity.comadding more products to their online menus and enablingdelivery to more locations. He cites as an example farmsupply retailer Tractor Supply Co., which last month beganoffering same-day delivery using Roadie from its entirenetwork of 1,863 stores. TheHome Depot is another majorretailer that for more than ayear has offered its customerssame-day delivery via Roadie.

Gorlin notes that same-dayhome delivery is not entirelynew; it’s just been reimaginedthrough the lens of e-commerce and mobile smartphonetechnology. “In the old times,we used to get visits from themilk man, the egg man, and the bread man, who all delivered to our front porch,” he recalls. “So, in some ways,interest in [home delivery of consumer staples] is like areturn to the past.”

ADJUSTING FOR THE RE-MIX

Covid- 19 has driven significant increases in e-commerce–
generated traffic for both FedEx and UPS. At the same
time, more expensive business-to-consumer home deliver-
ies have skyrocketed, while business-to-business volumes
declined precipitously.

UPS’s first-quarter 2020 e-commerce shipments wereup 19%, noted Brian Newman, UPS’s CFO, in the company’s earnings call. Business-to-consumer deliveries by quarter’s end approached nearly70% of U.S. deliveries, whilecommercial deliveries turnednegative. The overall result wasa 10% increase in total milesdriven and a 15% increase inaverage daily stops.

UPS Chief Sales and SolutionsOfficer Kate Gutmann addedthat during the pandemic,FedEx as well has seen a significant increase in e-commerce shipments and expects the trend to continue. FedEx’sKelly says he believes the industry is experiencing whatlikely will be an irreversible shift in consumer behavior