Regional Carriers Grow, Interest High

Nov 15, 2012 12:58 AM  By

At the recent Parcel Forum at the Hyatt Regency O’Hare, the sessions and exhibitors relating to regional carriers had great attendance and interest.

PITT OHIO general manager Kent Szalla led a panel of merchants that use regional carriers to deliver at least some of their packages. PITT OHIO began as an LTL but is now a total transportation provider and a member of The Reliance Network, a national alliance of regional carriers.

On the panel were Randy Abood and Kevin Peters from Dealer Tire, Tony Byrne of UR Source, and Mike Bollman from Amway.

The panel agreed that regional carriers especially excel when a good portion of your shipments are less than 500 miles away, but due to alliances that are now being formed, regional carriers can be considered for much wider delivery areas.

Dealer Tire is 12 years old with $12 billion in sales. They sell wholesale tires to dealers, and use a total of 30 regional carriers including Eastern Connection. Dealer Tire reports that regional carriers are usually better at customer service than FedEx and UPS. They still use a lot of FedEx and FedEx 2 day. Dealer Tire used to be in the 40% range for next day deliveries, now they are in the 99% range.

Dealer Tire recommends educating and communicating with your regional carriers. They held a carrier summit to talk about their needs, desires, and improvements that they wanted to make. Many service improvements were made, including almost eliminating damage claims.

UR Source has one location and distributes about 5,000 packages a week, spending about $2.5 million in shipping annually. Byrne uses PITT OHIO to help him make connections across the country through the Reliance Network, which covers Canada and the United States. Byrne used to work hard at zone skipping to California and Texas.

Byrne said he has decreased his turnaround time using regional carriers and can ship on Friday from Philadelphia and deliver to the west coast on Tuesday with two day shipping.

Bollman is the North American Logistics Manager for health and beauty merchant Amway, and works on both the inbound and parcel side. Bollman uses multi-carriers and consolidators, national and regional carriers and couriers.

Bollman has spent the last three years shifting to multi-state regional carriers to reduce his line haul costs, get better service and have less damage. He says that claims damage is two times as much with nationals than regionals. He ships 10 million packages a year.

Amway has been using local couriers for a long time, but now they are finding couriers with a bigger regional footprint.

Panel members were enthusiastic about the growing alliances between regional carriers to form more of a national network. PITT OHIO is a member of the Reliance Network (http://www.thereliancenetwork.com), which “creates a unified, across-the-continent coalition for all freight services”. It is comprised of Averitt, Canadian Freightways, Kingsway, Lakeville Motor Express, Land Air Express of New England, Mountain Valley Express, Peninsula Truck Lines, Inc., and PITT OHIO.

There were plenty of questions, including how do regional carriers track package milestones while zone skipping? Most people agree that there is a delay in reporting package milestones when zone skipping and using regional carrier, because packages don’t get scanned as often.

There was agreement that the regional carriers are less expensive, tend to deliver faster or pick up later, create considerably fewer damage claims, and provide better customer service for inquiries and requests than the national carriers.

However, there was a lot of concern about professional delivery image due to lack of uniforms and official vehicles from many regional carriers. Also, the larger merchants on the panel admitted that it could be more work to manage more carriers, and/or could effect your rates from your national carriers.