Postal Hub podcast

Cathy Morrow Roberson, founder and lead analyst at Logistics Trends and Insights, discusses what trends in consumer spending power and in-store shopping mean for e-commerce parcel volumes.

• Trends in US consumers' spending power
• What consumers are buying
• Consumers looking for bargains, and retailers looking to offload inventory
• Discretionary spending vs essential purchases
• Rising food prices and fluctuating fuel prices
• Are consumers returning to in-store shopping? If so, is this at the expense of e-commerce?
• The pandemic effect on retailers moving to omnichannel
• What does all this mean for parcel volumes?
• FedEx, UPS and USPS have been experiencing parcel volume declines
• Carriers looking for more profitable parcels
• Rate increases offsetting volume declines
• Regional carriers picking up volumes, but still representing a small percentage of overall parcel volumes
• The future for delivery and e-commerce
• Inflation and interest rates
• Excess last mile capacity
• Automating sorting facilities
• Warehousing employment in the USA

David Spottiswood, co-founder of Hurricane, and Cyril McGrane, Director International Trade at An Post, discuss An Post's experiences in implementing HS codes for inbound and outbound international parcels.

• Why data is king in cross-border e-commerce delivery
• Governments no longer ignore cross-border e-commerce
• Ireland was an early adopter of cross-border data obligations
• How An Post approached changes to security and data, while trying to meet delivery service level obligations
• Working with the regulator, Customs, and global trading partners
• How C2C transactions differ to B2B or B2C international shipments
• Why posts have to help customers in lodging international parcels
• An Post's investment in facilities in Ireland
• Building infrastructure with An Post's retail post office counters
• Handling data before the parcel arrives in Ireland
• Airlines requiring data about shipments before accepting them
• Building systems to support outbound parcels and inbound international parcels
• Postal operators don't want parcels to come back!
• Impact on customer experience
• ICS2
• An Post's international cooperation with other postal operators
• Non-compliance is no longer an option

It's episode 300! First up, Dean Maciuba (Crossroads Parcel Consulting) briefly discusses FedEx's plans to merge its Ground and Express delivery networks.

Then the USPS Inspector General, Tammy Whitcomb Hull, joins me to discuss the role of the Inspector General.

• The role of Watergate in the origins of Inspector General roles
• Oversight of the US Postal Service and Postal Regulatory Commission
• Law enforcement agents
• Audits into efficiency of the USPS
• Research and Insights Solution Centre (RISC)
• Contrasting the USPS OIG with other Inspector Generals, such as the State Department
• Field review team in post offices and mail processing centres
• Why the US Postal Service needs an Inspector General
• Investigating crimes that put the Postal Service at risk
• Ensuring the integrity of the Postal Service
• Difference between the USPS OIG and the Postal Inspection Service
• How the USPS OIG uses data in its work
• The correlation between parcel weight and postie injuries
• What the Inspector General does
• Tammy Whitcomb Hull's career path
• Mentoring withing the USPS OIG
• The Megan J Brennan Award for Excellence
• Women in the postal and logistics sectors

Paul Buijs, Assistant Professor in the Department of Operations at the University of Groning, and co-author of "A greener last mile: Reviewing the carbon emission impact of pickup points in last-mile delivery," joins me to discuss just how green out-of-home delivery might be:

• Defining pickup points (out-of-home alternatives to residential delivery)
• Out-of-home (OOH) delivery improving delivery route efficiency
• Reducing distance travelled by delivery vehicles
• Finding parking spots and time spent parking
• Time savings
• Transport used by customers collecting from OOH delivery points
• Measuring customers' tailpipe emissions when collecting OOH deliveries
• Impact of distance on consumers' decision-making process in choosing transport means
• Combining trips to collect parcels - trip chaining
• Using pickup points (OOH delivery) to reduce emissions
• Electric vehicles and collecting from PUDOs / parcel lockers
• Does OOH lose any emissions advantage as EVs become prevalent?
• Limitations on efficiency and impact on tailpipe emissions
• Consumers and delivery companies driving OOH adoption

Daniel Rueda, CEO at Open Pricer, on how parcel pricing can be leveraged to help deliver sustainable logistics solutions.

• The relationship between pricing and sustainability

• How can investments in new technology and new delivery vehicles be

• Are consumers ready to pay for environmentally sensitive delivery solutions?

• Paradoxes in delivery: price, speed, convenience (in-home vs out-of-home delivery), returns flexibility, and being environmentally friendly

• Compulsory CO2 labelling of parcel delivery options

• Using pricing to drive consumer decisions

• Improving network efficiency - increasing fleet optimisation

• Increasing load factors and the resulting environmental benefits

• The need to obsess over load factors and vehicle capacituy

• Helping e-commerce retailers

• Pricing: gross weight, volumetric, and volume

• Open Pricer's cloud pricing platform

Jonathan Bouaziz, CEO and co-founder at Kardinal, discusses next-generation route optimisation:

• The traditional use case for route optimisation in the delivery sector
• Why doesn't classic route optimisation work any more?
• Inability of some route optimisers to deal with dynamic parcel volumes and volatility
• Impact of B2C parcel volumes on route optimisation
• Maximising productivity and profitability of delivery subcontractors, while maintaining margin
• The battle for talent - keeping the best contractor drivers
• Route optimising and load balancing across territories
• Why is territory optimisation more relevant than classic route optimisation these days?
• Quality of data and impact on route optimisation tools
• Unlocking value in the delivery network - and not just focusing on the last mile
• Poor data can be overcome
• Kardinal's approach to route optimisation
• Assisting carriers negotiate with subcontractors
• Defining good mix between different delivery vehicles (e.g. vans, cargo bikes)
• Helping delivery companies meet emissions targets
• The "always on" approach to route optimisation
• Kardinal's new partnership with Escher
• The strategic imperative of reducing emissions vs the operational realities
• Defining fleet parameters, optimising territories by suitability of vehicle type, and looking towards the prospective delivery fleet
• Helping provide visibility of sustainability and profitability

Mindaugas Cerpickis, Managing Economist at Copenhagen Economics, discusses the state of the European postal sector, including declining letter volumes, growing parcel volumes, competition in the last mile, sustainability, and more

• Postal sector in Europe is expanding in terms of revenue and headcount
• Growth in total carbon emissions
• Larger, heavier parcels in the delivery stream
• Is e-commerce better for the environment than in-store shopping?
• The irrational behaviour of consumers when shopping online
• How regulations affect CO2 emissions
• Transition from letters to parcels
• What failure to adapt means for the bottom line
• Competition and market share in parcels
• Parcel pricing and the ability for postal operators to be competitive
• Network design and cost-efficiency of parcel delivery
• Increase in State aid during the pandemic, and complexities of State aid
• Accelerated letter volume decline
• Letter pricing, reducing costs in letter delivery (leading to alternative delivery models), and State aid
• Getting approval for changing letter delivery models
• Emerging trends that will impact the postal sector in coming years
• Green transition of the postal sector
• Role of postal regulators and policy makers in helping posts reduce emissions

Luke Lloyd, Head of Markets at the IPC, discusses some of the key findings from IPC's most recent Cross-border E-commerce Shopper Survey.

• How IPC surveys customers on their delivery preferences
• Reasons why consumers are overall buying less
• The value of free delivery
• E-retailers most used for most recent cross-border purchase
• Do consumers really know when they're buying cross-border?
• Importance of delivery speed
• Paying customs fees on cross-border purchases
• What triggers consumer complaints
• Consumer attitudes to sustainable delivery - including delivery speed
• Who pays for sustainable delivery?
• Consumer awareness of sustainability
• IPC's Sustainability Measurement and Management System (SMMS)

Dean Maciuba, Managing Partner North America at Crossroads Parcel Consulting, discusses the two US retail giants - Target and Walmart - and the competition with Amazon in the last mile:

• Walmart and Target's retail footprint, and where their stores are located
• Grocery as part of Walmart's retail offering
• Target and Shipt - and its success in BOPIS (buy online, pickup in store)
• Walmart and Target responding to Amazon's efforts in e-commerce and fast fulfilment / delivery
• Micro fulfilment centres vs regional fulfilment centres in supporting same-day delivery
• The advantage Walmart and Target have over Amazon in retail sites supporting fast delivery
• US consumers embracing BOPIS / click-and-collect
• Customers returning to bricks-and-mortar retailers
• FedEx stores in Walmart locations
• Returns and the physical network advantage
• UPS Store being used for Amazon e-commerce returns
• Third party returns via Walmart and Target stores
• Parcel lockers in US retailers for delivery and returns
• Walmart's GoLocal last mile delivery service
• Walmart+ in-home delivery to the garage... or even the refigerator!
• Security concerns about e-commerce delivery (including lockers)
• Transit times - Amazon dominating in one-day Prime
• Amazon's US fulfilment centre network and faster delivery times

When is a contractor not a contractor? Roel Gevaers, Professor in Last Mile Logistics and Supply Chain, University of Antwerp, discusses proposed legislation that will directly impact postal and delivery contractors:

• Background to proposed legislation targetting sham contracting / false self-employment
• Legislation only focuses on postal and parcel delivery drivers
• BIPT (postal regulator) will administer the legislation, meaning gig economy platforms are exempt
• Obligations on every postal or parcel company to monitor contractors / sub contractors
• Delivery sector needs to crack down on illicit behaviour
• Workload on BIPT
• Should existing legislation be better enforced rather than introducing new legislation?
• Different contracting models, including vehicle ownership, and work for other carriers
• How the legislation could change the contractor relationship
• Broad-based opposition to the legislation
• Impact on last mile costs
• Will delivery companies base themselves in The Netherlands to avoid compliance with Belgian legislation?
• Will the legislation in its current form protect workers from exploitation?
• Heightened interest in electrifying delivery fleets