MrFedEx
Engorged Member
A strike would be suicidal.
Why? Do you think Ground would be able to handle the volume or that customers would defect? Sooner or later, you need to stand your ground. We didn't, and look where we are at Express today.
A strike would be suicidal.
I hope you are wrong. Because if you are right the the whole industry gets thrown into a quagmire.Which begs the question, has UPS dropped prices to match Ground? Not from what I've heard. Your statement may have been true at one time, but if FedEx Ground now has the ability to offer similar service for considerably less, do you think the big volume shippers looking to save money will stay loyal to UPS? And if UPS loses enough of that business it will severely impact their ability to provide high pay and great benefits. FedEx Express slowed pay progression and cut benefits to increase profits. UPS will eventually have to do the same just to have profits. Assuming of course there won't be a labor friendly federal gov't with a spine that'll end FedEx Ground's advantage. That probably won't ever happen for one simple reason. It's not just FedEx lobbying for exemptions, etc. Shipping goods is a huge part of the economy and business leaders know what FedEx Ground means to their bottom line. When a Democrat administration and Congress failed to help Express employees it wasn't just Fred S throwing money around but the whole business community. We can't fight the inevitable, and neither can UPS. UPS is the last vestige of the golden years of package delivery. But the times they are a-changin'....
I hope you are wrong. Because if you are right the the whole industry gets thrown into a quagmire.
I hope you are wrong. Because if you are right the the whole industry gets thrown into a quagmire.
Add to this Amazon building regional warehouses and looking to offer same and/or next day delivery using local carriers and strategically located lockers.
Our senior said recently that Amazon and other big shippers are building regional facilities to take advantage of FedEx Ground's prices. Are there regional delivery operations big enough to compete with Ground?
No but they will offer the flexiblity neither Ground or UPS can---like same day delivery.
Same day delivery would have to be extremely localized otherwise the cost would
OnTrac is a California company that used to be called California Overnight. They have expanded their delivery areas to WA, OR, UT, AZ, CO and NV. They do overnight and Amazon is one of their clients. They definitely have some growing pains but they are growing.
Same day delivery is definitely possible for them. Even late pickup and early AM is possible for them since they are regional. Amazon gives them the cash infusion they need while they grow. I just wonder what they pay their drivers.
Amazon is opening distribution centers to capitalize on shorter shipping times, same day deliveries and even looking into their own delivery service. I wouldn't be surprised to find out that they have some money invested in OnTrac.
I have heard (probably on BC) about other shipping companies that are cropping up. The domestic market is going to change real soon.
The market to go after for Ex is international. If you want something to get to Asia or Europe you still need planes.
Same day delivery would have to be extremely localized otherwise the cost would
OnTrac is a California company that used to be called California Overnight. They have expanded their delivery areas to WA, OR, UT, AZ, CO and NV. They do overnight and Amazon is one of their clients. They definitely have some growing pains but they are growing.
Same day delivery is definitely possible for them. Even late pickup and early AM is possible for them since they are regional. Amazon gives them the cash infusion they need while they grow. I just wonder what they pay their drivers.
Amazon is opening distribution centers to capitalize on shorter shipping times, same day deliveries and even looking into their own delivery service. I wouldn't be surprised to find out that they have some money invested in OnTrac.
I have heard (probably on BC) about other shipping companies that are cropping up. The domestic market is going to change real soon.
The market to go after for Ex is international. If you want something to get to Asia or Europe you still need planes.
But to do same day delivery you'd have to keep it fairly localized. Is there a large enough market for that? I can't see Amazon building a network of distribution centers 50-100 miles apart, would cost billions. Not to mention the need to stock slow movers on the chance someone wanted same day service for that item. How many people are going to pay the cost of delivering an item to them that's located in a warehouse 200 miles away? Even local same day costs would be prohibitive. Even if the driver made minimum wage you'd have to charge enough in shipping to pay his costs plus fuel and make a profit too. If Amazon did offer same day it would have to be only in the biggest cities. Might be a reason FedEx is developing Cheetah over at Office.
According to their CFO, same-day is not feasible for every market so it doesn't seem to be the holy grail for them--but he doesn't deny they aren't looking into it.
But, they are trying to reduce their shipping costs and the transit times. I pay nothing as a Prime member for shipping on Amazon for some things and i get Saturday delivery at no extra charge. That's crazy. They want to get you your package the next day, hoping your need for instant gratification will keep you buying stuff from them. (Oh, the irony that is--isn't Fedex the reason everyone wants it right now!?)
I don't know how (or if I can) post links, but Googling amazon, same day, 3pl, and distribution centers has been very informative. My BIL is in cargo/freight/cartage and he was telling us (me and DH) that things are going to change. Obviously Fedex is trying to catch-up. I think they were under the impression that with the demise of DHL and the USPS they would own the world with UPS. But they can't buy Amazon like they buy out all the other competition, heck, Amazon can probably buy Fedex. As Fedex was once the game changer, Google and Amazon are the game changers now.
Is there really a market for same day delivery? Will getting that DVD of " The worlds greatest backyard fights" really make a difference if it comes that day or 3 or 4 days later? To most people, getting free shipping is the way to go. Even if it means having to wait 3 -7 days for it. As long as they come home from a long day of work and see that package laying by the door, they forget how long they waited to receive it.
Things might, but no matter the industry the biggest players always generate resentment. Ever deliver to a Walmart and have one of their employees tell you they are the world's biggest retailer and you'll just have to wait until they get to you? I have at several locations. It might be wishful thinking that FedEx and UPS will become obsolete in at least regional markets. The only way that will happen is building infrastructure. Building infrastructure on a regional basis to just undercut an already cheap FedEx Ground wouldn't return much on their investment. OnTrac is probably growing serving certain specialized segments of the shipping market where they can be competitive. FedEx Ground puts out a small army of delivery people every day, backed by logistical support and a 24/7 movement of freight by truck. Until a company can match that they won't be competitive in small package delivery.
I pay nothing as a Prime member for shipping
Prime you pay 79.00 a year for
I'm confused, everyone pays $79 a year for prime except you?
It's not to undercut. They will have the ability to choose who is the best (cheapest) shipper for the shipment. They even bought a robotic picker thingy company (Kiva) to make it even more efficient. If Fedex ground is the cheapest way to get it there that's what they choose. Why do you think your Amazon pkgs are so haphazard. Unlike some of our large shippers you can't count on having Amazon on any given day.
They have given up the state sales tax fight and decided to go another route. A lot of people stopped buying from them in certain states (like Texas) because of this. But they have been educated at the Fred S School of Business--change is good.
So, Amazon isn't the only player in the game, but if they are successful then others will follow suit.
I had more but I accidentally deleted it ---
...just don't buy the idea that any company without Ground's infrastructure can duplicate or even surpass Ground.
Suppose Amazon builds a warehouse in Dallas, TX., and contracts with a local carrier to deliver exclusively within the Dallas metro area. You would not need a feeder network or infrastructure to accomplish this.