Global parcel volume increased 21% in 2021 to 159 billion pieces, according to an annual Pitney Bowes shipping index that tracks activity in 13 markets, but revenue increased at a slightly lower rate of 17% as declines in per-piece yield in China acted as a check on that growth.
The situation in the parcel industry — high shipping rates, increased surcharges and shipping delays — is a convergence of many complex issues, including supply/demand imbalance, a rough economy and geopolitical woes. Let’s take a closer look at how ecommerce and government laws have disrupted supply chains.
The U.S. Postal Service is shortening the promised service levels for two of its ground delivery products, syncing them with its First-Class Package Service (FCPS), a move the USPS says will drive efficiency by consolidating processing and transportation of volume from all three products.
U.S. Postmaster General Louis DeJoy outlined plans to streamline facilities and delivery networks to make them more efficient by significantly reducing the number of processing plants and delivery units, eliminating redundancies in an effort to improve performance.
While U.S. parcel volume rose nearly 6% to 21.5B pieces in 2021, it was the slowest growth in five years, and considerably less than the massive 31.5% gain in a pandemic-driven 2020, according to Pitney Bowes’ annual index. It also showed smaller carriers growing rapidly but still holding a tiny percentage of the overall pie.
Adding a cubic pricing option for users of USPS Parcel Select Ground product will be a boon for shippers with small, dense and heavy packages but not so much for others, experts said ahead of the July 10 live date for the change. In general, packages must be under 20 lbs. and there’s a 50,000 package a year minimum.
Postmaster General Louis DeJoy said the U.S. Postal Service will be forced to initiate “uncomfortable” price increases for market dominant USPS products such as first-class mail, marketing mail and periodicals, while shippers using Parcel Select Ground can benefit from use of cubic pricing.
As much as ecommerce sellers want every shopper that loads up their cart to complete a purchase, the reality is that some simply won’t. However, many shoppers that vanish at the sight of added shipping fees will in fact hit the “buy” button IF they are given more shipping options and control over how they receive their order.
Via.Delivery, a startup platform offering the power of buy online, pickup in store (BOPIS) to smaller retail and ecommerce businesses, has expanded beyond its Russian roots with a launch here that features 21,000+ pickup locations at pharmacies, convenience marts and grocery stores.
President Biden is close to getting Louis DeJoy removed as Postmaster General, which would end a rocky 18-month tenure for the Trump appointee and would-be reformer who, it was frequently noted, was a major donor to the campaign of the former president and 2020 RNC finance chair.