Regional parcel carriers have gained much interest over the last few months since the 2013 peak holiday season. So who are the major players in the regional parcel carrier space and why would anyone want to utilize a regional parcel carrier? Regional parcel carriers have a rate structure that can be up to 30% cheaper. In additional regional parcel carriers do not charge all of the accessorial charges that UPS and FedEx charge resulting in lower costs. UPS and FedEx have up upwards of 44 accessorial charges. Regional parcel carriers may not weigh a shipment based upon dimensional weight. However, they may weigh on actual weight. It is estimated that regional parcel carriers have about 3% of the parcel market share with around $1 billion in combined revenue. The regional players are much smaller than UPS and FedEx.
Regional parcel carriers focus on a certain geographical areas. They usually cater to small and medium size businesses and specialize in business to business deliveries. Most of their shipments are delivered within one to two days. Many of the regional carriers utilize independent contractors to pick up and deliver shipments.
As mentioned earlier, regional parcel carriers focus on a particular geographic area. Here are a few of the major players and the geographical areas served. Please note that if a state is listed the regional parcel company may not serve the entire state. Please check the company’s website to review the service map.
OnTrac is a west coast based parcel carrier that serves WA, OR, CA, NV, UT and CO. Website: www.ontrac.com.
LSO (Lone Star Overnight) is a south west carrier that serves TX, OK, AR, LA and NM. Website: www.lso.com.
Eastern Connection is an eastern and mid-western regional carrier serving ME, NH, MA, NY, CT, RI, NJ, MD, DE, PA, VA, OH, KY, IA, MI and WV. Website: www.easternconnection.com
Spee Dee Delivery is a Midwestern carrier that serves NE, WI, SD, ND, IA, MI, IL and MO. Website: www.speedeedelivery.com
Pitt Ohio Express serves the following states, MI, WI, and IL, IN, OH, MI, PA, WV, VA, MA, DE, NJ, CT, MA, RI, NH, ME and KY. Website: www.pittohio.com
Purolator is a well known Canadian carrier and serves the Canadian parcel market. Website: www.purolator.com
There are several other regional players; however, they are more oriented toward the courier business.
The advantages to utilizing a regional parcel carrier are costs savings, fewer surcharges and a larger next day delivery footprint. The downsides are most regional parcel carriers have limited delivery range, utilize independent contractors, offer limited value added services (free consulting services) and limited bundled solutions. If you are considering utilizing regional parcel carriers it is important to understand where you are shipping your goods and understand your existing parcel contracts.
Logistic Trends Inc. can provide your firm with valuable insights and knowledge on the regional parcel carrier space. We can be reached by email at email@example.com or by phone 770 639-2230.