Wednesday, September 19, 2012

Package Deal

Parcel giants expand international facilities despite current downturn.

Small package carriers are the most profitable segment of the transportation industry, and have been largely insulated from the turmoil that has seen demand and profits whipsawed for ocean, LTL and truckload operators. With international expedited freight now seeing a “bump on the road” in their own category, the parcel duopoly of FedEx and UPS, plus international carrier DHL, are putting the pedal to the metal and moving to expand their networks with new facilities.

Internationally, air cargo was down 3.3 percent in July from year-ago levels, reported the International Air Transport Association, with a 3.6 percent decline in both North America and Europe. Asia-Pacific carriers transported 7.6 percent less freight than a year ago, with Air China profits falling 77 percent on a 22.7 percent drop in cargo revenue. Only the Middle East bucked the trend, with air freight traffic surging 16 percent year on year.

UPS just opened a new facility in Halifax, and DHL is opening an additional distribution center in India, where the company handled nearly 9 million international shipments last year. FedEx is nearly doubling its International Service network, adding destinations in Australia, Austria, Brazil, Canada, Denmark, Japan, Luxembourg and Mexico. The company now offers time-definite, customs-cleared, door-to-door service to 19 countries, with one-to-three day delivery, depending on the origin and destination, said FedEx.

With expedited service your most expensive transportation option, it pays to use it wisely. Too many shippers overspend on expedited shipping – for example, shipping packages by priority overnight that would arrive next day with routine, and much cheaper, standard ground service. Are you getting the most out of your logistics dollar?

SPECIAL NOTICE – Inventory Planning Webinar:
Please be on the lookout for a special invitation to our inventory planning webinar scheduled for 11am on Wednesday, Oct. 10th.

Kirk Shearer
800-989-0054 x103

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