Category: Industry News

Legacy delivery companies like FedEx Corp. and United Parcel Service Inc. played a huge role in the decline of the U.S. Postal Service, but it’s time for them to pay the piper–technology has brought them face-to-face with their own competitive threat: Amazon.com Inc., Uber and other startups.

Mobility, brought upon by the proliferation of smartphones, apps and connected devices, has created a climate of instant gratification and given way to a fast-growing market for on-demand delivery services, such as Postmates.

“It’s a changing of the guards,” said Roger Kay, a technology analyst and founder of consulting company Endpoint Technologies Associates “If the old guards can’t provide a comparable experience and comparable price, in some sense they aren’t going to be competitive anymore.”

Changing end markets
The big three changes since the last recession are:

• A strong increase in business-to-consumer, or B2C, e-commerce-based package deliveries as online shopping increases in popularity
• Customers increasingly prefer cheaper, less time sensitive deliveries over faster, more expensive options.
• Increasing protectionst trade policies by governments worldwide are causing growth in global trade (trade between countries) to lag domestic GDP growth. This is not great news for transportation companies.

The Supreme Court of the United States recently issued its decision in Young v. United Parcel Service, Inc.. Vacating and remanding the Fourth Circuit’s decision, the Court concluded that the Pregnancy Discrimination Act (“PDA”) “requires courts to consider the extent to which an employer’s policy treats pregnant workers less favorably than it treats nonpregnant workers similar in their ability or inability to work” and that there was a genuine dispute regarding “whether UPS provided more favorable treatment to at least some employees whose situation cannot reasonably be distinguished from Young’s.” Young v. United Parcel Service, Inc., 575 U.S. ___ (2015).

An Atlanta startup wants to do the shipping industry what Uber has done to the taxi business.

Roadie puts unused capacity in passenger vehicles to work by connecting people with stuff to send with drivers heading in the right direction. Essentially, the service allows drivers to monetize their daily commute, or vacation road-trip to Disney.

“There’s somebody going just about everywhere from everywhere all the time,” Roadie CEO Marc Gorlin said. “If you can tap that traffic, you have a larger distribution network than UPS, FedEx and USPS combined.”