FedEx is actively seeking more commercial partnerships with international postal operators to provide end-to-end supply chain solutions for e-commerce retailers, a senior executive told the World Postal Business Forum at Post-Expo in Paris.
The US integrator already has long-standing partnerships with the US Postal Service, Canada Post, Royal Mail’s Parcelforce Worldwide and Taiwan’s postal service, and earlier this year announced an international parcel agreement with Japan Post.
Now the company is looking to sign up more Posts for similar agreements, helping postal operators to “move up and down the value chain” and avoiding “commoditisation of transportation”, Carl Asmus, Vice President Supply Chain Solutions for FedEx Services, told an audience of senior postal managers yesterday.
“Postal delivery will be the dominant delivery (method) for cross-border e-commerce,” he predicted.
This is particularly likely as more and more low-value goods enter the international e-commerce business, driven by increasing consumer confidence in cross-border shopping. At the same time, consumer demands for localised products and services, transparent payments including full landed costs, and multiple shipping options are rising, he emphasised.
Yet Posts need to go beyond just providing transportation and delivery, Asmus underlined. He warned: “If you fail to move upstream or downstream in the value chain, then transportation will be commoditised. What could be more commoditised than free shipping?”
Instead, partnerships could be created to offer solutions that bundle transportation with added-value services, he suggested. One example could be ‘returns logistics’ offering repairs instead of just simple returns to the seller, an area where FedEx had made “substantial” investments, he noted. Additionally, FedEx’s Delivery Manager tool enabled consumers to control their own delivery options, he pointed out.
“Posts need to align and collaborate with cross-border enablers, so they can go to local merchants with solutions,” he said. These could then be offered as co-branded solutions in the local market.
Asmus cited the examples of FedEx’s co-branded international partnerships with USPS and Canada Post which “take the best of both networks”. He added: “I can see an opportunity where we work with other Posts to combine competences.”
Pascal Clivaz, the UPU’s deputy Director General, who was speaking during the same conference session, responded to a CEP-Research question by confirming that “every Post is free to decide on a public-private partnership”.
However, he emphasised that the UPU offered the world’s postal operators their own solution through the EMS network while the new ECOMPRO integrated e-commerce product offering is also being developed. “The UPU has to make sure that the solutions we have are open to all (Posts),” he commented.
Speaking earlier, Clivaz told the UPU World Postal Business Forum: “E-commerce is the most important driver for Posts today. The challenge is for Posts to adapt to the expectations of e-commerce where more actors are involved in the supply chain than at the domestic level.”
