Loyalty to a trusted brand may be noble, but blind brand loyalty is dangerous. In retail, how often do consumers stick to a brand simply because it’s the name they hear the most — through advertisements, habits, traditions, fill in the blank? It’s only when they start asking the right questions, instead of blindly following traditions, that they realize maybe the big, established name brands aren’t actually the best choice.
In terms of the trucking industry, carriers are obviously essential for shippers, but blind brand loyalty is just as common.
“There are many reasons,” said Josh Taylor, director of professional services at ShipWare, a partner of alternative delivery network SmartKargo. “Habit, tradition, fear, safety, simplicity. There’s an old expression that states, ‘No one ever got fired for buying IBM,’ and it certainly plays a role here.”
Often, those in the logistics industry choose delivery partners just like many consumers choose brand-name toothpaste — for the name’s sake.
“For the longest time they were the only two major players — that was it,” said Chris Grey, vice president of business development at SmartKargo. “However, in today’s climate, being limited to these choices has risks associated with it and many small-package shippers want alternatives — especially with market issues like pandemics, strikes, growth of tech partners and the rise of regional carriers. Not to mention that the desire of most customers is that they want their packages in two days or less.”
With big-name carriers promising to deliver to every address, inexperienced shippers view their selection of those carriers as something they can set and forget. They have other things to worry about and assume carriers are all basically the same, Grey added.
This is simply not the case. Technology is taking over the logistics and delivery space, making it easier to partner with smaller players at much lower cost yet still have a network that works efficiently. At the end of the day, all shippers want a happy customer. Delivery is the last part of the journey for an online purchase, and it should always be as satisfying as the purchase itself, while providing great value along the way.
The folks at SmartKargo have provided a brief guide on how to know when it’s time to make the switch and what to look for when evaluating alternative carriers.
Is it time to evaluate alternative carriers?
It takes time to vet new partners. Because of this, it is better to stay ahead and begin this process before periods of high network congestion, such as peak seasons, when it is hard to find new partnerships.
As far as who should consider it, Taylor believes that businesses spending a few million dollars annually on transportation should certainly seek out secondary carriers. “Companies fulfilling from multiple locations are in a particularly good position to take advantage of regional carriers offering better pricing and service,” he said.
According to both Grey and Taylor, small-package shippers should consider a number of things when evaluating whether to seek alternate carriers:
- What are your most pressing shipping needs?
- What factors are most important to you and to your clients?
- Where are your customers located and are they in regional clusters?
- What is your current shipping spend?
- What are your shipping commitments to your current carrier(s)?
Other things to consider could include delivery time frames, customer expectations, services, pricing, short-term and long-term shipping goals, and specific key performance indicators (KPI).
Considering a delivery partner
After assessing your own needs, it’s important to ask the right questions to evaluate which carriers might be a good fit. According to Taylor, transparency, reliability, predictability and value are the top traits shippers should be looking for in a carrier.
“The package needs to get from point A to point B on time. Without this reliability, it’s impossible to trust a carrier,” he said. “Shippers know that shipping costs money, but the big-name carriers boast about playing a game of smoke and mirrors with their pricing. Shippers want to know they’re getting a fair deal.”
These are the top questions small-package shippers need to ask themselves when they begin to consider a delivery partner, according to both Grey and Taylor:
- What areas do you serve, and do you deliver to commercial or residential locations, or both?
- What is your pricing, and does it change based on volume?
- What is your delivery time frame?
- What tracking technology do you use, and what technology do you use to integrate with other systems?
Taking a chance
Cutting big names out entirely would be difficult for most large shippers. But shippers need to understand the risks associated with single sourcing, according to Taylor.
“Not only will you pay more, you’re also unlikely to get the best service for the price you pay. And you’re shipping at the pleasure of the carrier,” he said. “Almost any ‘contract’ a shipper has with a carrier is technically an agreement, and it always benefits the carrier much more than the shipper.”
Many shippers have found success when adding an alternate carrier to the mix. In 2022, alternate carriers increased their volume by 25%, according to the Pitney Bowes Parcel Shipping Index. Shippers are discovering the numerous benefits of diversifying their carrier mixes with non-national carriers.
“Be balanced in order to mitigate risk and reduce your cost of shipping by looking for networks and partners that align with the needs of your organization and your customer — service flexibility, simplified pricing, faster time in transit and not so many accessorial fees are just the start,” Grey added. “Evaluate and use the right alternative networks that beat your current price point, meet your enhanced steamship line (SSL) needs and provide superior technology to delight your customers with items like visual proof of delivery (VPOD), maintenance management system (MMS) and other customer-oriented communications.”
SmartKargo’s small-package delivery platform boasts two-day transit across the U.S., flat rate pricing, no accessorial fees, easy integration with established shipping technologies, complete transparency and reporting, and over 2,500 flights a day across the U.S. with its airline partner, said Grey.
Big-name carriers may have extensive networks and technology, he added, but they have not been able to keep up with changing consumer and retailer needs over the past few years. Once small-parcel shipping skyrocketed in 2020, shippers needed to innovate to stay in business. Many regional carriers saw this newfound market need and chose to expand services and delve into new technologies to draw the overflow from national carriers. Will you deliver?
To learn more about SmartKargo, visit its website.