For years, companies have enlisted the aid of "logistics consultants" to increase productivity and reduce costs in their supply chains. Shippers have been advised to optimize their number of distribution centers and streamline steps in their supply chains, with the ultimate goal of expediting products to market. In most cases, shippers have used the giant overnight express carriers to source these goods over large geographic areas. But this reliance on the nationals isn't necessarily the norm any longer.

Today, thanks to improved sales forecasting and advanced information technology, shippers can more effectively get products to the right place, at the right time, for the right costs. Indeed, this new shift in supply chain thinking is bringing products closer to consumers and allowing shippers to take advantage of less expensive services and carrier options. These options include parcel consolidators, LTL companies, small courier networks and regional express parcel services.

Increasingly, shippers with regionally located distribution centers which are closer to their customers are turning to these alternative express parcel carriers. In a nutshell, the leading regional carriers, which rely on ground versus air transport, typically provide later pickups and earlier deliveries for less money than their national counterparts. They are more flexible, more personable and sometimes more efficient than the giants.

But as shippers continue to consider regional solutions, they are advised to perform due diligence. They should select a regional carrier that, unlike the myriad of "mom and pop" shops, exhibits "big company qualities," including multiple service offerings, technological sophistication and overall professionalism.

Well-Grounded Services

While smaller shops offer just same-day messenger services, the leading regional express carriers provide a portfolio of products that mirrors or even surpasses the nationals. Ask about 24/7 priority overnight capability, next flight out and specialized services such as medical shipping, logistics and warehousing, truck/freight and postal expedition. Also, review the scope of the service area (i.e., number of ZIP Codes covered).

One particular product offering that is now in much greater demand is less-costly, time-definite, next-day deferred ground shipments. Customers have been demanding a flexible service of this kind as an option to the more restrictive national ground services. When approaching a regional alternative about this, ask if it provides guaranteed deliveries by 5 PM the next business day with one-zone pricing. For example, Eastern Connection now offers this service from Maine to Virginia. In contrast, national carriers don't offer a one-day ground service commitment along the eastern corridor but do have higher pricing for Zone 3 and Zone 4. With the Eastern Connection model, the price of a ground package from Maine to Virginia is the same as that of a package delivered across town.

As a rule, the ability to move inventory closer to the ultimate consumer has reduced the need for premium overnight services and has opened the door for next-day ground products at a much-reduced cost. The bottom line? Shippers are realizing that a ground shipment moving on a truck with a 5 PM delivery commitment is about 20% less costly than air transport. Do the math: Over the course of a year, these savings can be very dramatic.

Technology and Reliability

Historically, regional carriers have been more flexible than the giants with regard to customized solutions that meet individual shipping needs. They are also less rigid when it comes to surcharges like oversized pieces, delivery area surcharges, shipment minimums and general discounting. But while companies have always appreciated flexibility and a "high touch" approach, they are now expecting their delivery services to offer state-of-the-art high tech as well.

Therefore, shippers should carefully review the technology capabilities of their carrier, including tracking and online proof of delivery. For example, does the company provide scanner barcoding to protect customer confidentiality and expedite tracking of shipments? Ideally, packages should be scanned at the points of pick-up, sort, delivery load and POD. In addition, has the prospective carrier invested in a proprietary shipping system to process customer shipments, and does it provide electronic data interchange (EDI) invoicing?

When regional carriers invest in advanced technology, their efficiency improves. The perception may be that the overnight giants, with their big brand names, are necessarily more reliable than their regional counterparts. But keep in mind that ground transportation requires fewer exchange points than air transport and less margin for handling errors. So take a closer look at performance ratings and ask about insurance claims and safe driver records.

When evaluating alternative delivery services, also consider the company's vehicles and the professionalism of its drivers, including identification.

Driven to Deliver

In the final analysis, shippers often don't care how their carriers move their cargo, whether by ground or air. What they want is an assurance that their packages will be delivered when promised, in good condition, at a fair price.

Certainly, the regionals will never replace the nationals. But increasingly, they are gaining market share because shippers are discovering that the premier regional services those that exhibit "big company qualities" are indeed driven to deliver. That means later pickups, earlier deliveries and increased efficiency. For less.

Jack Mitchell is the Executive Vice President of Sales and Marketing at Eastern Connection, the largest regional express parcel service on the East Coast. For more info, visit www.easternconnection.com.