Regional parcel carriers are a vast group and each has its own set of strengths that your organization can leverage to enhance your supply chain. They can provide better transit, white glove services, special handling, and, in most cases, better prices. In order to understand how regional parcel carriers can provide value for your organization, it is important to know the evolution of the types of regional carriers and the niches each fills. The momentum is changing. Shippers are coming to understand that there are alternatives in the parcel delivery space, and you can join the wave.
Let’s Define the Two
There are two major types of regional carriers; carriers that can provide multi-state solutions and others that are couriers or “micro-regionals” that cover smaller geographic regions such as cities or partial states.
Several highly successful regional parcel carriers started as priority next day delivery companies. They focused at the start to deliver early morning, mid-morning, or by noon. As the economy ebbed and waned, these carriers moved to general parcel ground freight that rides along the same network as their priority packages.
Certain industries adopted the regional model years ago. Office supplies, automotive, post office integrators, and medical/pharmaceutical distribution are industries that have leveraged regional parcel carriers for various reasons. These companies with resources to control pricing across the supply chain had the ability to purchase the best rates on truckloads or pallets into metropolitan regions and then leverage regional carriers to fit their needs.
Office supplies started shipping larger items, such as desks, that were costly to move with other modes. Over time, the office supply companies learned that the regional carriers could handle these larger items at a fair price and also handle their multiple package deliveries well. There is a point where the per package price of a national parcel carrier becomes price prohibitive, and regionals can capitalize on this. A gray area of shipping also exists between 70 and 200 pounds per shipment, where regional parcel carriers can excel against traditional parcel and LTL.
Medical companies hired regional parcel carriers on a dedicated basis to monitor the controlled pharmaceutical substances. They learned that these same regional transportation practices can be used for more aspects of their business. By using regional carriers, the medical supply companies were able to find a lower cost carrier willing to provide white glove service, allowing them to capitalize on the savings.
Automotive companies need early morning deliveries and were able to do this by controlling line haul and leveraging regional providers for early delivery to local mechanic shops. Price for delivering is important, but timing is usually more important to achieve their goal of getting customers on the road quicker.
Postal integrators are a unique breed and have come more recently into the model. National parcel carriers have leveraged “last-mile” delivery companies to deliver packages to the local post office, which then handles final delivery to residential consumers. Many regional carriers do some work with the post office, but the post office is always looking for other carriers to grow their network.
Zone skipping can be a fantastic way to leverage regional carriers and provide value for your supply chain through faster transit, lower cost, or both. There are a handful of larger regional parcel carriers that together cover most of the USA and have the ability to manage a regional carrier network for you. Most smaller or medium sized companies have regional shipping patterns with 80% of their shipments staying within zones 2 through 5; this is the sweet spot for the multi-state regional carriers. Regional carriers will thrive on service and offer a very competitive rate, which allows the customer to realize cost savings in their short-haul deliveries through zone skipping.
I have always said that moving an item from point A to point B has unlimited paths. A single carrier to service all needs does not exist at an optimal price. Some industries have already figured out the value regional parcel carriers can provide. If you have not given consideration to regional carrier networks, now is your opportunity to take another look at your supply chain and jump ahead of your competition by leveraging the competencies these carriers hold.
Kent Szalla is General Manager of PITT OHIO GROUND and US Cargo. For more information, visitwww.pittohio.com
Let’s Define the Two
There are two major types of regional carriers; carriers that can provide multi-state solutions and others that are couriers or “micro-regionals” that cover smaller geographic regions such as cities or partial states.
Several highly successful regional parcel carriers started as priority next day delivery companies. They focused at the start to deliver early morning, mid-morning, or by noon. As the economy ebbed and waned, these carriers moved to general parcel ground freight that rides along the same network as their priority packages.
Certain industries adopted the regional model years ago. Office supplies, automotive, post office integrators, and medical/pharmaceutical distribution are industries that have leveraged regional parcel carriers for various reasons. These companies with resources to control pricing across the supply chain had the ability to purchase the best rates on truckloads or pallets into metropolitan regions and then leverage regional carriers to fit their needs.
Office supplies started shipping larger items, such as desks, that were costly to move with other modes. Over time, the office supply companies learned that the regional carriers could handle these larger items at a fair price and also handle their multiple package deliveries well. There is a point where the per package price of a national parcel carrier becomes price prohibitive, and regionals can capitalize on this. A gray area of shipping also exists between 70 and 200 pounds per shipment, where regional parcel carriers can excel against traditional parcel and LTL.
Medical companies hired regional parcel carriers on a dedicated basis to monitor the controlled pharmaceutical substances. They learned that these same regional transportation practices can be used for more aspects of their business. By using regional carriers, the medical supply companies were able to find a lower cost carrier willing to provide white glove service, allowing them to capitalize on the savings.
Automotive companies need early morning deliveries and were able to do this by controlling line haul and leveraging regional providers for early delivery to local mechanic shops. Price for delivering is important, but timing is usually more important to achieve their goal of getting customers on the road quicker.
Postal integrators are a unique breed and have come more recently into the model. National parcel carriers have leveraged “last-mile” delivery companies to deliver packages to the local post office, which then handles final delivery to residential consumers. Many regional carriers do some work with the post office, but the post office is always looking for other carriers to grow their network.
Zone skipping can be a fantastic way to leverage regional carriers and provide value for your supply chain through faster transit, lower cost, or both. There are a handful of larger regional parcel carriers that together cover most of the USA and have the ability to manage a regional carrier network for you. Most smaller or medium sized companies have regional shipping patterns with 80% of their shipments staying within zones 2 through 5; this is the sweet spot for the multi-state regional carriers. Regional carriers will thrive on service and offer a very competitive rate, which allows the customer to realize cost savings in their short-haul deliveries through zone skipping.
I have always said that moving an item from point A to point B has unlimited paths. A single carrier to service all needs does not exist at an optimal price. Some industries have already figured out the value regional parcel carriers can provide. If you have not given consideration to regional carrier networks, now is your opportunity to take another look at your supply chain and jump ahead of your competition by leveraging the competencies these carriers hold.
Kent Szalla is General Manager of PITT OHIO GROUND and US Cargo. For more information, visitwww.pittohio.com
