This Week in Logistics News (September 30-October 6)

This has been a tough week. The senseless shooting in Las Vegas has left me grasping for something to write. But I just don’t even know what to say. However, this is not the appropriate place for me to step up on my soapbox, so I’ll share something my colleague Steve Banker said in his opening keynote at MercuryGate’s user conference in Las Vegas earlier this week. Steve said he was glad that the conference wasn’t canceled, because if it was, the bad guys win…

And now, on to the news.

In following a service by its subsidiary, Walmart will soon offer free, same-day delivery on orders in New York City. The company already offers free, two-day shipping on orders over $35, a move Walmart made in response to Amazon Prime’s two-day shipping program. So how is Walmart planning on making same-day deliveries? By acquisition of course. The company has acquired New York City-based logistics startup Parcel (potentially for less than $10 million). Since its founding in 2013, Parcel has handled both scheduled and same-day deliveries for meal-kit providers and e-commerce companies. The startup has built a database of every New York City building it has delivered to, featuring information and photos for each building’s service entrance to maximize efficiency in an environment that can be hard to navigate quickly. This information should help Walmart speed up delivery service in the city.

Amazon is testing a new delivery service in the US geared towards making more items available for two-day delivery. The service, named Seller Flex, began in India two years ago, and allows Amazon to oversee the pick-up of packages from warehouses and third-party merchants selling on Amazon will also oversee the delivery of these packages, which gives the company the option of making deliveries themselves, or route the packages through UPS or FedEx. The key is that Amazon is in control of how these deliveries are made, making it easier to service more customers with more deliveries. This seems to be another logical step in Amazon’s move to become full-service logistics provider.

There have been signs of improvement in the Puerto Rico supply chain which had been at a near stand-still since Hurricane Maria slammed the island. A steady flow of trucks started arriving at port operations early Saturday morning to pick up containers and bring them to distributors, stores, and other clients in Puerto Rico. Cargo, storage yard, and distribution companies kept their doors open all weekend in order to try and alleviate the backlog of emergency supplies like food, medicine, water, and construction materials at San Juan’s port. While the backlog is easing, the flow of goods is still slow. One hundred percent of the FEMA cargo has been picked, but only 20 percent of the commercial loads have been sent out.

Robots are at it again. Deutsche Post has selected the German town of Bad Hersfeld as its test site for a robot to accompany mail deliverers on their routes and carry their mail items. The robots, dubbed PostBOT, are self-propelled electric robots that are capable of carrying up to six postal trays. This relieves the burden of carrying heavy loads while enabling the post carriers to go hands-free, thus making it easier and quicker to distribute the mail. Deutsche Post will evaluate the pilot program to see how well the robots support staff with their physically demanding work, and make a decision on further deployment.

Instacart has not rushed into overexpansion, specifically outside of the US. However, with Amazon’s acquisition of Whole Foods, Instacart is now looking for greener pastures. The grocery delivery start-up is close to a deal with Loblaw Cos., Canada’s largest grocer. The deal will allow Instacart to begin delivering groceries from Loblaw stores in Toronto and then expand nationally throughout the grocery chain over the next year. The Canadian grocery delivery market could soon be crowded, as Amazon has announced plans to roll out its Prime Now membership delivery service into Canada later this year, and earlier this month, Metro Inc. announced it would focus on online grocery delivery in Quebec.

Target is testing curbside pick-up in fifty Twin Cities stores. The service, named Drive Up, launched earlier this week. Customers can place an order through Target’s app, and at check-out, select “Drive Up”, rather than in-store pick-up or delivery. When they are on their way to the store, they press a button to let Target know. Once they arrive, they park in a specified parking area and a Target employee brings the order out to the car. The program is similar to buy online, pick-up in-store, except that the customer does not even have to get out of their car. While this limits up-sell and cross-sell opportunities, it is still more profitable than ship from store.

And finally, UPS and Chinese express delivery company SF Holding announced they have received approval from Chinese regulators for an international package delivery services joint venture. The two companies have been working together since 2015, but the partnership is now official. With approval from China’s Ministry of Commerce, the firms said in a statement that they will initially provide package delivery services from China to the United States, which will be expanded to other countries. The venture will combine SF’s 13,000 service points in 331 cities in China with UPS’ global network spanning 220 countries.

That’s all for this week. For the song of the week, I wanted to pick a song in remembrance of Tom Petty. However, I realized that picking just one would be nearly impossible for me. So the song of the week is not a song, it is Tom Petty’s greatest hits. Enjoy.

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