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Retailers accelerate last-mile investments, expand carrier networks

Tech firm data reveal last-mile trends, show on-time performance improved among carriers in April.

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DC Velocity Staff
By DC Velocity StaffMay 20, 2021
DC Velocity Staff
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Retailers are accelerating their last-mile investments and adding delivery partners to meet higher customer expectations, according to data from Austin, Texas-based last-mile technology firm Convey, released Wednesday.

Convey surveyed 600 retail decision makers and analyzed its own performance and market share data for FedEx, UPS, USPS, and regional carriers to assess recent and future last-mile delivery trends. The company found that a majority of retailers (57%) have expanded their carrier network over the past year and that most (81%) are focused on investing in more complex last-mile initiatives in the next 12 months. Respondents said they’ve expanded their carrier networks in order to meet customer demand for faster delivery, to balance delivery costs with customer expectations, and as a way to offer innovative delivery options in order to remain competitive.

Convey’s analysis also found that on-time performance for package delivery has stabilized since the start of the pandemic last year. Analyzing its shipment data for April—which the firm says includes tens of millions of packages shipped from more than 500,000 locations across North America—the firm found that 82% of parcel shipments were delivered on time, up from 77% in April 2020.

“This is likely due to the fact that volume-related network stress has decreased (no panic buying; brick and mortar reopening),” the researchers wrote. “In addition, carriers have caught up to new processes and labor impacts are less common.”

They added that on-time performance hasn’t quite caught up to April 2019 levels (89%) due to performance issues at FedEx, which maintains the largest share of the market, according to Convey data. FedEx performed lower than other carriers in April 2021, according to Convey—71% on-time performance compared to 88% for UPS and 90% for USPS—with its most inexpensive service levels hit hardest.

“FedEx recently announced significant open positions for its Ground service, so we will continue to monitor and see if these new hires positively impact their on-time-performance,” according to Convey.

Convey data also show that market share has held steady among the leading carriers over the past three months, with FedEx at 36%, UPS 28%, USPS 9%, DHL 10%, and regional carriers at 16%.
ArticleTruckingTransportation
convey
ArticleTruckingTransportation
convey

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