Six months ago, who would have predicted that 2012 would turn out to be the year that it's been? And we still have six more months to go!
While its summertime and we're in the midst of the baseball season, as a Cubs fan I've already resigned myself to next year (OK I'm busted, the year after next) and anxiously await the start of the football season. And as all football fans know, at halftime the commentators show first half highlights and make their predictions on what will happen in the second half. So with that in mind, let's take a look at the 2012 parcel game...
--UPS opened up the scoring by going long, airing it out and making the play to acquire TNT. Being headquartered in Atlanta, they know how to play big time SEC football.
--While there was plenty of speculation that FedEx would make a counter offer they stuck with a solid ground game: Announcing acquisitions to expand service in Poland, France and Brazil; with additional plans to open more stations throughout their existing European footprint.
--The USPS continues to facilitate e-commerce plays through their last-mile delivery and first-mile return capabilities. While their current financial challenge makes it tough to score, let's face the fact that today's B2C growth wouldn't be what it is without this important player.
--While not making the highlight reel, regional carriers continue to quietly score points with new customer wins and a coordinated strategic alliance message.
--At the end of June, instead of running out the clock we get blindsided with the sudden closure of Streamlite, an announcement from EquaShip that they will not re-launch, and a last second play from Congress who (finally) passed a two-year Highway Bill.
Wow, that was quite a half! What keys to the game will carry over from the first half and what new options will decide the game in the second half?
--Look for the UPS-TNT deal to close in the third quarter. What, if any, assets will European regulators require them to sell off? Watch to see if FedEx or DHL make a play on that.
--FedEx is to provide details of their Express operating cost structure plan to further improve the unit's operational efficiency, adjusted to current economic levels at their Investor Conference in early-October.
--For all us parcel wonks, Parcel Forum 2012 celebrates 10-years with a solid conference line-up October 23-25th in Chicago. That's sure to score a touchdown.
--Then there's the big play, potential game changer November 6th election that will impact us all.
--Another series of annual rate increase announcements will come out this fall. Will the base rate and accessorial increases be higher, lower, or the same as last year?
--Late in the game we'll expect to see plenty of "free shipping" plays to attract more e-commerce orders over the holiday with fewer postal consolidators now in business to service those needs.
For people who think football's a contact sport, they should try playing the parcel shipping game!
Wasn't so long ago that we played the game with a level of certainty, holding on to expectations of what business would look like for a period of time to come. Welcome to the new world of volatility. While tactical rate negotiations and contractual terms are still important; strategic risk management practices will play an increasingly important role going forward.
Here are three lessons I took out of the first half of 2012 that support that premise and will play out for a period of time to come:
First, understanding a carrier's financial position will be as, if not more important than knowing their service portfolio.
Second, anticipate potential operating authority or scope of operation changes in advance rather than reacting after the fact.
Third, develop alternative carrier and alternative mode contingency plans using a series of defined trigger events as mileposts. You'll have indicators to help you predict if or when you need to make adjustments.
For players who prefer to play one-on-one, good luck keeping up with today's volatility game. For players who prefer to win, they understand the need to be a part of a team, one who's on their side and here to help.
Doug Kahl is Founder and Principal of Integrity Logistics Consulting Group; Executive Consultant Parcel, TranzAct Technologies; active CSCMP Arizona Board Member; and a contributing writer to PARCEL.
While its summertime and we're in the midst of the baseball season, as a Cubs fan I've already resigned myself to next year (OK I'm busted, the year after next) and anxiously await the start of the football season. And as all football fans know, at halftime the commentators show first half highlights and make their predictions on what will happen in the second half. So with that in mind, let's take a look at the 2012 parcel game...
--UPS opened up the scoring by going long, airing it out and making the play to acquire TNT. Being headquartered in Atlanta, they know how to play big time SEC football.
--While there was plenty of speculation that FedEx would make a counter offer they stuck with a solid ground game: Announcing acquisitions to expand service in Poland, France and Brazil; with additional plans to open more stations throughout their existing European footprint.
--The USPS continues to facilitate e-commerce plays through their last-mile delivery and first-mile return capabilities. While their current financial challenge makes it tough to score, let's face the fact that today's B2C growth wouldn't be what it is without this important player.
--While not making the highlight reel, regional carriers continue to quietly score points with new customer wins and a coordinated strategic alliance message.
--At the end of June, instead of running out the clock we get blindsided with the sudden closure of Streamlite, an announcement from EquaShip that they will not re-launch, and a last second play from Congress who (finally) passed a two-year Highway Bill.
Wow, that was quite a half! What keys to the game will carry over from the first half and what new options will decide the game in the second half?
--Look for the UPS-TNT deal to close in the third quarter. What, if any, assets will European regulators require them to sell off? Watch to see if FedEx or DHL make a play on that.
--FedEx is to provide details of their Express operating cost structure plan to further improve the unit's operational efficiency, adjusted to current economic levels at their Investor Conference in early-October.
--For all us parcel wonks, Parcel Forum 2012 celebrates 10-years with a solid conference line-up October 23-25th in Chicago. That's sure to score a touchdown.
--Then there's the big play, potential game changer November 6th election that will impact us all.
--Another series of annual rate increase announcements will come out this fall. Will the base rate and accessorial increases be higher, lower, or the same as last year?
--Late in the game we'll expect to see plenty of "free shipping" plays to attract more e-commerce orders over the holiday with fewer postal consolidators now in business to service those needs.
For people who think football's a contact sport, they should try playing the parcel shipping game!
Wasn't so long ago that we played the game with a level of certainty, holding on to expectations of what business would look like for a period of time to come. Welcome to the new world of volatility. While tactical rate negotiations and contractual terms are still important; strategic risk management practices will play an increasingly important role going forward.
Here are three lessons I took out of the first half of 2012 that support that premise and will play out for a period of time to come:
First, understanding a carrier's financial position will be as, if not more important than knowing their service portfolio.
Second, anticipate potential operating authority or scope of operation changes in advance rather than reacting after the fact.
Third, develop alternative carrier and alternative mode contingency plans using a series of defined trigger events as mileposts. You'll have indicators to help you predict if or when you need to make adjustments.
For players who prefer to play one-on-one, good luck keeping up with today's volatility game. For players who prefer to win, they understand the need to be a part of a team, one who's on their side and here to help.
Doug Kahl is Founder and Principal of Integrity Logistics Consulting Group; Executive Consultant Parcel, TranzAct Technologies; active CSCMP Arizona Board Member; and a contributing writer to PARCEL.
