I Like Big-Box and I Cannot Lie
Nearly half of small to mid-sized business (SMB) decision-makers involved in distribution, logistics, and/or procurement estimate an increase in shipping spend in 2020 compared to 2019, and big-box retailers are influencing their strategy, finds logistics technology platform uShip’s 2020 SMB Shipping Strategies report.
About 25% of decision-makers say the logistics strategies of Amazon and Walmart influence how their business thinks about shipping, and 27% say those strategies influence how their customers think about shipping.
The pressure from big-box retailers creates an underlying tension with companies that likely don’t have the infrastructure or resources to support aggressive logistics strategies. As a result, SMBs are left to decide whether to invest in teams or technology. About 20% of SMB decision-makers would rather invest in the right logistics team over technology, while nearly 30% plan to make new technology a priority.
Meanwhile, 14% say investing in new technology is too expensive and 17% prefer to invest in alternatives to traditional shipping options such as UPS, FedEx, and freight brokers.
While parcel shipping remains a fairly well-oiled machine for many businesses, shipping large and bulky e-commerce furniture, vehicles, sporting equipment, safes, and more remains a mystery to many (see chart). And when they have oversized or fragile items to deliver, many SMBs don’t find service reliable or affordable.Among SMB decision makers:
- 17% don’t trust fragile items to arrive safely or unbroken
- 15% can’t find a reliable carrier for oversized and bulky items
- 12% can’t find an affordable shipping solution
- 11% don’t know where to find alternative shipping options to organizations like UPS, XPO Logistics, and freight brokers
With the logistics sector moving quickly in favor of big-box retailers’ strategies, SMB shippers need new ways to compete and address these pain points, especially for big and bulky items. SMBs should carefully evaluate all their options and make informed decisions when searching for new shipping and supply chain strategies or partners.