Skip to content
Search AI Powered

Latest Stories

newsworthy

Parcel company EquaShip suspends operations, goes back to drawing board to retool

Company founder promises faster, better service upon re-launch

EquaShip, a Seattle-based company that opened its doors last October, touting itself as the nation's fourth small parcel carrier behind FedEx Corp., UPS Inc., and the U.S. Postal Service, has closed its doors until further notice.

EquaShip announced earlier this month that it is "temporarily suspending" all operations while it retools its pickup and delivery network and works out the service glitches that plagued it virtually from the start. Ron Wiener, EquaShip's president and CEO, said it is possible, but unlikely, that the company could resume operations as early as the third quarter.


Wiener also ruled out a re-launch during the fourth quarter, which coincides with the busy holiday shipping season for the e-commerce merchants the company is targeting. He said EquaShip's service problems last year were exacerbated by the timing of its launch, and that performance suffered during the holiday "crunch time" for e-tailers and their service providers.

According to Wiener, EquaShip's customers had tendered only a small portion of their shipments to the company, and they had viewed the service as a type of pilot initiative. With EquaShip out of the picture, those shippers will redirect their parcels to the providers that had been handling them prior to his company's launch, Wiener said.

EquaShip's sales proposition was that it could significantly underprice FedEx and UPS on business from small to mid-size e-merchants that lacked the daily volumes to qualify for the deeply discounted package-consolidation services offered by the parcel giants and the U.S. Postal Service (USPS). A large percentage of e-commerce shipments are tendered to FedEx and UPS as well as to a cluster of parcel consolidators, who in turn induct them into the USPS' low-cost network for so-called last-mile delivery to the final destination. UPS estimates that 35 percent of its deliveries are from businesses to consumers, with many of those packages consisting of items ordered online.

EquaShip, which operated no vehicles or warehouses, used the St. Paul, Minn.-based consolidator Blue Package Delivery LLC to handle parcel pickup and the subsequent line-haul to the postal system. However, Wiener said Blue was unable to meet the transit-time needs of EquaShip's customers. He also said that Blue's I.T. integration with the "first mile" carriers that pick up at origin was too limited and thus restricted shipment visibility.

According to Wiener, Blue's routing capabilities, which are well-suited for hauling parcels to USPS for shippers that operate multiple warehouses, did not align well with the need for fast and predictable transit times demanded by EquaShip's customers, which were shipping from a single point of origin.

Wiener estimated that even in the best-case scenario, Blue was hitting Equaship's delivery commitments only 65 percent of the time, generally an unacceptable performance ratio in the parcel delivery world.

"We assumed this was working right," Wiener admitted. "We're not going to take a carrier's word for it ever again."

Executives at Blue declined to comment.

At this point, EquaShip is evaluating other carriers. It plans to rely on a regional carrier network augmented by a national parcel consolidator for long-haul deliveries, Wiener said. He added that customer response to the company's strategy was overwhelmingly positive.

"Demand generation was not the problem," he said.

The Latest

More Stories

Trucking industry experiences record-high congestion costs

Trucking industry experiences record-high congestion costs

Congestion on U.S. highways is costing the trucking industry big, according to research from the American Transportation Research Institute (ATRI), released today.

The group found that traffic congestion on U.S. highways added $108.8 billion in costs to the trucking industry in 2022, a record high. The information comes from ATRI’s Cost of Congestion study, which is part of the organization’s ongoing highway performance measurement research.

Keep ReadingShow less

Featured

From pingpong diplomacy to supply chain diplomacy?

There’s a photo from 1971 that John Kent, professor of supply chain management at the University of Arkansas, likes to show. It’s of a shaggy-haired 18-year-old named Glenn Cowan grinning at three-time world table tennis champion Zhuang Zedong, while holding a silk tapestry Zhuang had just given him. Cowan was a member of the U.S. table tennis team who participated in the 1971 World Table Tennis Championships in Nagoya, Japan. Story has it that one morning, he overslept and missed his bus to the tournament and had to hitch a ride with the Chinese national team and met and connected with Zhuang.

Cowan and Zhuang’s interaction led to an invitation for the U.S. team to visit China. At the time, the two countries were just beginning to emerge from a 20-year period of decidedly frosty relations, strict travel bans, and trade restrictions. The highly publicized trip signaled a willingness on both sides to renew relations and launched the term “pingpong diplomacy.”

Keep ReadingShow less
forklift driving through warehouse

Hyster-Yale to expand domestic manufacturing

Hyster-Yale Materials Handling today announced its plans to fulfill the domestic manufacturing requirements of the Build America, Buy America (BABA) Act for certain portions of its lineup of forklift trucks and container handling equipment.

That means the Greenville, North Carolina-based company now plans to expand its existing American manufacturing with a targeted set of high-capacity models, including electric options, that align with the needs of infrastructure projects subject to BABA requirements. The company’s plans include determining the optimal production location in the United States, strategically expanding sourcing agreements to meet local material requirements, and further developing electric power options for high-capacity equipment.

Keep ReadingShow less
map of truck routes in US

California moves a step closer to requiring EV sales only by 2035

Federal regulators today gave California a green light to tackle the remaining steps to finalize its plan to gradually shift new car sales in the state by 2035 to only zero-emissions models — meaning battery-electric, hydrogen fuel cell, and plug-in hybrid cars — known as the Advanced Clean Cars II Rule.

In a separate move, the U.S. Environmental Protection Agency (EPA) also gave its approval for the state to advance its Heavy-Duty Omnibus Rule, which is crafted to significantly reduce smog-forming nitrogen oxide (NOx) emissions from new heavy-duty, diesel-powered trucks.

Keep ReadingShow less
chart of global trade forecast

Tariff threat pours cold water on global trade forecast

Global trade will see a moderate rebound in 2025, likely growing by 3.6% in volume terms, helped by companies restocking and households renewing purchases of durable goods while reducing spending on services, according to a forecast from trade credit insurer Allianz Trade.

The end of the year for 2024 will also likely be supported by companies rushing to ship goods in anticipation of the higher tariffs likely to be imposed by the coming Trump administration, and other potential disruptions in the coming quarters, the report said.

Keep ReadingShow less