I’m Jay Kent, managing director of SLB Performance, a consulting firm that helps companies reduce supply chain costs, implement BI tools, and improve in-stock and customer service. After 25 years of leading some of the most complex supply chains in the industry, I began advising companies in multiple industries and verticals. To mitigate costs and improve efficiencies, it’s important to understand the market. So, twice a month, I’ll share parcel news and thoughts. Be sure to hit the subscribe button to receive the latest newsletter in your LinkedIn notifications.
As we enter the heart of the holiday peak season, a few announcements worth noting:
- Walgreens recently closed a warehouse in Edwardsville, Ill., dedicated to filling e-commerce orders and is now having its store employees pick and pack items for same-day delivery through third-party apps such as DoorDash and Uber Technologies’ Eats division, according to a WSJ story (subscription may be required). Walgreens says 78% of Americans live within 5 miles of one of its stores.
- HelloFresh has launched its own delivery fleet network and is currently available in 19 major metropolitan areas. “HelloFresh is always innovating to provide a best-in-class experience for our customers,” said Nunzio Di Savino, Vice President of US Logistics for HelloFresh. “Our delivery fleet is one new way that we’re ensuring customers’ orders arrive fresh and on time. Our main priority will always be to offer our customers the most seamless end-to-end experience.”
Meanwhile, the USPS reported its financial results for the 2023 fiscal year ended September 30. The net loss totaled $6.5 billion, compared to net income of $56.0 billion for the prior year. Total operating revenue was $78.2 billion for the year, a decrease of $321 million compared to the same period last year, as package revenue increases were offset by mail revenue declines. “…Continued rising costs in several areas of our business pose a challenge,” said Chief Financial Officer Joseph Corbett. “We, however, remain steadfast in our commitment to grow package revenue and manage the costs within our control, such as by reducing work hours by 28 million hours and by taking calculated steps to decrease transportation costs consistent with the tenet of our Delivering for America plan to optimize our networks.”
Good story from Max Garland of Supply Chain Dive – The parcel delivery market may be swinging in shippers’ favor, but UPS and FedEx customers will still have to contend with rate increases for 2024. Very good points from Kevin Miller, VP of data insights at logistics software provider Sifted – companies should also consider what they can adjust internally to avoid unnecessary shipping costs, such as using less bulky packaging or splitting a large item into two individual shipments to avoid surcharges. Shippers may also opt for less expensive ground transportation for more time-sensitive deliveries if the destination is close enough to the shipment’s origin.
In case you missed it, I recently chatted with Steve Ferreira. Check out what I had to say starting at 17:22.
That’s it for now. Comments are always welcome. Reach out if you’d like to learn how to lower or even possibly eliminate the Additional Handling surcharge or any other parcel fee. Stay tuned for the next newsletter on Nov 29, and don’t forget to hit the subscribe button to ensure you receive it in your LinkedIn notices.- Jay