Best/Top Analysis

Delivery Companies: 2020 Winners

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FedEx, UPS, and DHL are three examples of companies in the United States package and letter delivery industry that have seen success in 2020 as a result of the COVID-19 pandemic. Details supporting this statement are provided below.

FedEx

  • FedEx, according to Chief Information Officer Robert Carter, has been “in peak since the beginning of the pandemic” and is now bracing for “a record-breaking peak” this 2020 holiday season.
  • The company has prepared well for the holiday surge with all its investments in process optimization and automation. Four of these investments are especially helpful in moving the holiday volume, and they are the company’s investments in a cargo recognition and organization system (CoRos), a parcel tracking tool called SenseAware ID, a collaborative project with Microsoft called FedEx Surround, and automated delivery modes such as drones and delivery robots.
  • The CoRos, developed with Mercedes-Benz, automates package scanning as the package is placed into a delivery van, while SenseAware ID gives shippers increased visibility into the movement of parcels across FedEx’s network.
  • FedEx Surround combines scan, conveyance, and sensor data with external data such as traffic and weather to provide useful insights to shippers, while drones and delivery robots offer reliable autonomous last-mile delivery services.
  • Data from ShipMatrix shows that FedEx had performed well in terms of on-time delivery during the week of October 11. That week, FedEx Ground, which accounts for most of the company’s deliveries to residences, had a performance rating of 95.5%, while FedEx parcel services, as a whole, had a performance rating of 96%.
  • To cope with increased work volume, FedEx’s delivery networks are also now operating 24/7.

UPS

  • UPS has seen its drone delivery service grow because of the COVID-19 pandemic. The COVID-19 pandemic has served as an impetus for the increased exploration of medical supply delivery via drones.
  • UPS has recently teamed up with Drone Up and Workhorse Group, both aerial drone companies, and the Center for Innovative Technology in Virginia to explore the use of drones in the delivery of medical supplies during this COVID-19 crisis.
  • When it entered this partnership, the company, through its UPS Flight Forward unit, had already been successfully performing drone delivery services for a North Carolina hospital for over a year.
  • Drone delivery tests in Virginia started in April. Though the results of these tests are not publicly available, Scott Price, the chief strategy and transformation officer of UPS, shared that they have “proven through ongoing commercial drone delivery programs that effective drone delivery of medical products is faster than conventional ground-based transportation” and that “drones offer a low-touch option for the delivery of lab specimens and medical products that could make a significant impact in an urgent response application.”
  • After receiving a Part 135 certification in 2019, UPS had also started working with drone provider Matternet to launch a commercial drone delivery business in North Carolina. This business, to date, has made over 2,200 deliveries or 4,400 flights.
  • The fact that there was news last July indicating that UPS was expanding its drone delivery service in North Carolina and to Florida suggests that the business is a successful and growing venture.
  • A Forbes article also indicates that “Amazon, Google, and UPS are set to redefine the landscape of delivery more broadly” because of their drone delivery services.

DHL

  • Even though DHL has faced several safety-related challenges since the onset of the coronavirus pandemic, it has enjoyed surges in several areas of its business.
  • In an interview with Jeff Berman, news editor at the Logistics Management Group, Rick MacDonald, president of DHL Supply Chain’s retail sector business in North America, shared that DHL has experienced surges in several parts of its business because of the COVID-19 pandemic and the resulting increase in online purchases.
  • Apart from implementing safety measures, DHL has adapted to the increased work volume by extending work shifts and hiring more people.
  • As a company that focuses on long haul or line haul transportation, not final mile delivery, it has taken steps to make processes in its facilities more efficient and to provide better support to final mile delivery service providers.
  • One of the steps it has taken is the use of robotics and mechanical machines in its facilities to increase both capacity and efficiency and to allow workers to focus on jobs they enjoy doing.
  • DHL uses robots or mechanical machines in jobs that workers do not want to perform, such as jobs that require frequent walking or lifting of heavy items. It has enlisted the help of LocusBots, for example, to cut down walking time in its facilities.
  • Another step it has taken to improve work efficiency is its introduction of IDEA, a pick routing tool that is powered by artificial intelligence and that integrates with the warehouse management system (WMS) and the enterprise resource planning (ERP) system.
  • The tool prioritizes time-critical shipments and optimizes picking routes and workload distribution among warehouse workers. It is especially designed for warehouse environments where order sizes are small but the stock-keeping unit (SKU) count is high.
  • Initial deployment results show that the distance traveled by workers has dropped by as much as 50% and productivity has increased by as much as 30%.
GLENN TREVOR
Glenn is the Lead Operations Research Analyst at Simple Manifestation with experience in research, statistical data analysis and interview techniques. A holder of degree in Economics. A true specialist in quantitative and qualitative research.

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