Consumer need for speed in package delivery, which has reached its apex with same-day shipping, has placed retailers in a tough spot when it comes to managing transportation costs.
The result is increased competition among shippers for retail volume in a market dominated by FedEx and UPS, according to a new survey from global consulting firm AlixPartners. Retail executives surveyed say as more — especially younger — consumers demand same-day delivery, the financial payoff isn’t there.
Some alternative parcel delivery companies identified as benefitting from the move to diversify last-mile delivery include OnTrac, Pandion, and LSO/Lone Star Overnight. Additional delivery companies include Uber Eats and Uber Connect, Postmates, DoorDash, Instacart, and Shipt. Free delivery is still the big draw for consumers, with 92% saying that factors into their buying decisions, but the consumer threshold of waiting for product delivery is 3.
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