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How to Identify Your Freight Class: A Quick Guide

colorful freights at a port

In logistics and transportation, there’s a critical element that affects shipping costs and strategies: freight class. This often-overlooked measurement plays a pivotal role in determining the price of shipping goods across various carriers and businesses in Less Than Truckload (LTL) freight.

What is Freight Class?

Freight class, as defined by the National Motor Freight Traffic Association (NMFTA), standardizes pricing in the LTL freight sector. Essentially, it’s a system that categorizes different types of products or commodities based on their characteristics and assigns them a specific freight class number. This number ranges between 60 and 400, with lower numbers representing heavier, denser items, and higher numbers indicating lighter, bulkier, or more delicate items.

Calculating Freight Density

The process of calculating freight density is a crucial step in determining its freight class. Here’s a simplified guide to this calculation:

  1. Measure the length, width, and height of the freight in inches, including packaging.
  2. Multiply these dimensions to obtain the cubic inches.
  3. Divide the cubic inches by 1,728 (the cubic inches in a cubic foot) to convert to cubic feet.
  4. Divide the weight of the freight in pounds by the cubic feet calculated in the previous step. This gives you the density of the freight.

In equation form: Density = Weight (lbs) / Volume (cubic feet)

Factors Influencing Freight Class

Several factors play a role in determining a product’s freight class. Understanding these factors can provide insights into how the classification system operates:

1. Commodity and Density: While some commodities have pre-defined freight classes, others are density-based. Density is determined by the ratio of the total cubic feet to the total weight in pounds. Generally, a lower density corresponds to a higher freight class. This means that lightweight items that occupy a lot of space might end up with a higher class and, subsequently, a higher shipping cost.

2. Stowability: Stowing freight efficiently is essential for optimizing transportation resources. Freight that’s difficult to load due to its weight, size, shape, or regulatory restrictions may incur a higher freight class. Items that cannot be loaded with other goods due to safety concerns are also assigned a higher class.

3. Handling: Freight goes through various handling checkpoints during its journey. Items that require special handling due to their fragility, weight, shape, or hazardous nature might be classified as a higher freight class. This classification accounts for the extra care and resources needed to transport such items safely.

4. Liability: The likelihood of theft, damage, or harm to other freight or workers is an important consideration. Freight that poses higher liability risks, such as perishable items or hazardous materials, tends to have a higher assigned class due to the increased responsibility and potential costs associated with their transportation.

Unveiling the Impact

These factors create a comprehensive classification system that ensures fair pricing and efficient handling of various types of cargo. By comprehending the nuances of freight class, shippers can make informed decisions about packaging, shipping methods, and cost-effective strategies to optimize their supply chain.

So, the next time you’re shipping goods, remember that beyond weight and size, it’s also commodity characteristics, stowability, handling requirements, and liability considerations that determine your freight class. Unlocking the secrets of this classification system could potentially lead to more streamlined shipping processes and enhanced cost savings for your business.

For expert guidance and support in mastering freight shipping, connect with us at US Cargo Link.

6 Ways to Lower Freight Shipping Costs

colorful freights at a port

The shipping industry is evolving, and so are the strategies to optimize freight costs. Managing costs is crucial for maintaining a healthy bottom line. In this blog post, we’ll delve into some valuable insights and tips based on key principles on how to manage and reduce freight shipping costs.

1. Know Your Transportation Options:

The foundation of effective cost management begins with understanding your shipping options. As US Cargo Link offers a range of logistics solutions, businesses can choose between ocean, air, and ground transportation methods. By aligning your cargo with the most suitable mode, you can unlock potential savings. For instance, ocean shipping, known for its cost-effectiveness, is a prudent choice for international goods. Hence, combining multiple modes can lead to even better results, reducing costs while ensuring timely deliveries.

2. Consolidation for Efficiency:

Consolidation is a strategy that US Cargo Link recognizes as a game-changer. By combining LTL shipments or partnering with nearby companies, you can benefit from shared resources and reduced expenses. This approach not only drives down costs but also enhances transit performance, a win-win scenario.

3. Packaging and Design Optimization:

Much like the importance of smart packaging in logistics, US Cargo Link emphasizes efficient packing. Consider adopting packaging strategies that maximize the use of space, allowing you to ship more products with fewer pallet spaces. Collaborating with carriers to optimize packaging can lead to lower freight costs without compromising product protection.

4. Leverage Relationships and Contract Rates:

US Cargo Link’s advice on building carrier relationships aligns with nurturing partnerships to reduce freight costs. Negotiating attractive rates with high-volume carriers can yield favorable terms and consistent savings. Contracting long-term arrangements not only provides cost certainty but also enables carriers to optimize their operations, resulting in mutual benefits.

5. Strategic Timing and Logistics Planning:

In line with US Cargo Link’s approach to off-peak shipping, effective logistics planning plays a vital role in cost reduction. By analyzing shipping patterns, you can identify optimal times to schedule shipments, taking advantage of lower rates during off-peak periods. Implementing a comprehensive logistics strategy allows you to make informed decisions that lead to enhanced efficiency and cost savings.

6. Embrace Innovation and Outsourcing:

US Cargo Link’s recommendation to outsource freight management resonates with the idea of leveraging technology and expertise. Embracing innovations such as transportation management software (TMS) can streamline operations, optimize rates, and enhance overall efficiency. Outsourcing to experienced logistics partners enables businesses to tap into industry knowledge, driving down costs while maintaining quality service.

In the dynamic world of logistics, cost management is a continuous endeavor. By understanding transportation options, embracing consolidation, optimizing packaging, fostering relationships, strategic planning, and leveraging technology, companies can achieve significant savings while ensuring seamless logistics operations.

At US Cargo Link, we believe the path to lower freight shipping costs is a strategic blend of innovation, collaboration, and proactive decision-making. Contact us now to optimize you freight costs!

Factors that Impact Freight Rates

a bustling port nestled along the coastline, where there's a multitude of meticulously stacked freight containers

In the ever-evolving world of freight shipping, understanding the intricacies of pricing and factors affecting costs is essential for businesses seeking to streamline their supply chain operations and optimize budgets. Let’s delve into the key elements that influence freight rates.

  1. Delivery Speed: During the pandemic, the landscape of delivery expectations has undergone a dramatic transformation. Flexibility and speed are no longer merely desirable. The demand for flexibility and speed isn’t just a convenience—it’s a game-changer that directly influences your freight costs.
  2. Weight, Density, and Freight Class: The weight and density of shipments significantly impact freight class, which, in turn, affects costs. Employing lightweight yet durable packaging and partnering with efficient shippers can lead to better rates. The larger the package, the higher the freight class, and the more it’ll cost.
  3. Distance and Geographic Optimization: Geography plays a pivotal role in freight costs, with longer distances generally translating to higher expenses. The key lies in strategic geographic optimization, which involves setting up fulfillment centers strategically, reducing outlying deliveries, and maximizing truck capacity.
  4. Seasonal Trends: The ebb and flow of seasonal demands directly influence freight rates. Accurate forecasting, based on historical trends, mitigates budgetary challenges during periods of heightened demand.
  5. Disruptions: Supply chain disruptions have become a norm, necessitating proactive strategies to manage unforeseen challenges. By devising robust contingency plans, you can navigate disruptions and their subsequent impact on freight costs.
  6. Fuel Costs and Freight Demand: Fuel costs and fluctuating demand directly influence shipping rates. Awareness of regional fuel costs and fluctuations empowers you to anticipate variations in shipping expenses. Monitoring supply and demand trends enables you to leverage favorable market conditions to your advantage.
  7. Accessorial Charges: Accessorial charges can significantly impact freight costs. Being well-informed about potential accessorial charges, such as lift gates and special deliveries, enables you to accurately budget and avoid unforeseen expenses.

By integrating these insights into your freight shipping strategy, you can navigate the complex landscape of freight rates with confidence. Remember, a well-informed approach, proactive planning, and strategic partnerships are the keys to optimizing costs while ensuring efficient and reliable deliveries.

For expert guidance and support in mastering freight shipping, connect with us at US Cargo Link.

5 Keys to Successful Supply Chain and Logistics Management

a bustling port nestled along the coastline, where there's a multitude of meticulously stacked freight containers

In today’s fast-paced business world, logistics management stands as a critical and complex aspect of supply chain operations. Companies must continuously adapt to ever-changing demands and challenges to ensure the efficient movement of goods from manufacturers to consumers. Here are 5 key elements that ensure smooth logistics activities:

1. Planning:

Logistics planning serves as the backbone of a smooth supply chain operation. The fluctuating nature of supply and demand in the market requires constant coordination and organization. Warehouses and storage units act as crucial components to maintain a steady supply of goods. Proper logistics planning ensures timely delivery and effective handling of products, contributing to a healthy supply chain.

2. Packaging:

Packaging/unitization plays a pivotal role in preserving product quality and ensuring safe transport. The design, materials, and branding of packaging are carefully strategized to create a positive consumer experience. Unitization assists in optimizing storage and transportation by bundling goods into easily transportable shapes. The goal is to fit products into a cuboid shape, which helps streamline the logistics process.

3. Inventory Control:

Inventory management is a vital element in logistics management, playing a critical role in controlling the flow of goods and products going in and out of warehouses. It involves predicting consumer demand by analyzing sales data and utilizing statistical tools to ensure optimal inventory levels. Effective inventory management enables businesses to avoid stockouts and oversupply. A well-managed inventory system enables businesses to optimize their supply chain and maintain healthy profit margins.

4. Transportation:

Transportation is a major cost driver in logistics management, making it essential to find fast and cost-effective methods for product delivery. Different products require various transportation modes, ranging from road vehicles to air transport. In the era of e-commerce, customers expect rapid and reliable deliveries, underscoring the need for transparent and efficient transportation services.

5. Information Management:

Data-driven logistics is the future of the industry. Effective IT management systems throughout the supply chain enable businesses to enhance efficiency, reduce errors, and meet customer demands accurately. From inventory flow, procurement or auditing to warehouses and transportation, data analysis supports strategic decision-making and helps achieve business goals.

The ever-evolving landscape of supply chain management demands a comprehensive understanding of logistics management. By focusing on the critical components of planning, packaging, inventory control, transportation, and information management, businesses can build a strong foundation for efficient supply chain operations. A well-executed logistics strategy empowers companies to stay ahead of the curve, reduce costs, and deliver exceptional customer satisfaction, all essential elements for sustainable success in the dynamic world of modern business.

Ready to optimize your supply chain and streamline your logistics operations? Choose US Cargo Link! Partner with us and get seamless, cost-effective, and customized solutions for all your logistics needs. Contact us today and let’s unlock the full potential of your supply chain together.

How to select the right Third-Party Logistics Partner

Three skilled personnel engaging in warehouse operations sealing successful partnerships with a firm handshake

In today’s fast-paced business world, effective supply chain management is essential for success. The complexity of logistics increases tremendously as businesses grow and enter new markets. This is where Third-Party Logistics (3PL) providers come in, offering expertise, resources, and efficiency to streamline the supply chain process. Based on a recent survey conducted in 2022 with over 300 participants from the shipping industry, 86% of shippers acknowledged the cost-effective benefits of collaborating with a Third-Party Logistics (3PL) provider for their logistics needs. In this article, we will explore the benefits of 3PL and provide insights on how to choose the right 3PL partner for your company.

Understanding 3PL and its Advantages:

Third-Party Logistics, or 3PL providers offer outsourced logistics services, including transportation, warehousing, inventory management, order fulfillment, and more.

There are many benefits that come with 3PL services. Firstly, it allows companies to focus on their core competencies by offloading non-core activities to experts. 3PL organizations are experts and can impart clients with their experience and connections to quickly streamline process. Moreover, partnering with a 3PL can lead to cost savings through economies of scale, improved inventory management, and reduced transportation expenses.

Selecting the Right 3PL Partner:

Choosing the compatible 3PL partner requires careful consideration and a thorough evaluation of various factors. Here are some key considerations to guide your decision-making process:

  1. Expertise and Services: Assess your specific logistical needs and ensure that the 3PL provider offers the required services and expertise to meet them effectively.
  2. Network and Reach: Evaluate the 3PL’s network of warehouses, distribution centers, and transportation capabilities.
  3. Technology and Integration: Ensure that the 3PL provider utilizes advanced software and systems for real-time tracking, visibility, and analytics.
  4. Reliability and Track Record: Look for a 3PL partner with a proven track record of reliability, on-time delivery, and exceptional customer service (references and client testimonials, …)
  5. Flexibility and Scalability: A flexible 3PL partner will adapt to your evolving needs, offering scalable solutions and the ability to accommodate growth or seasonal fluctuations.

Selecting the right 3PL partner can significantly improve your supply chain efficiency, reduce costs, and increase customer satisfaction. Collaborating with a reliable and capable 3PL provider will not only streamline your logistics processes but also allow you to focus on your core competencies, ultimately driving your business toward long-term success in an increasingly competitive marketplace.

At US Cargo Link, we are an asset-based logistics provider, meaning we own all the assets necessary to run a client’s supply chain. These could include trucks, warehouses, distribution centers, etc. Contact us today to see how we can fulfill your logistic needs!

The Evolution of Warehousing in 2023: Meeting Modern Demands

Employee skillfully navigates lift truck, moving pallets with care

In 2023, warehouses are going through an exciting transformation to meet the changing needs of modern supply chains. With advancing technology and higher customer expectations, warehouses are adopting innovative solutions to improve efficiency and create exceptional experiences. Let’s dive into the key trends shaping the warehousing world this year.

Automation and Robotics: Warehouses are embracing automation and robotics to streamline processes and boost productivity. Robots like autonomous guided vehicles (AGVs) and robotic picking systems are revolutionizing order fulfillment, reducing errors, and speeding up deliveries. These technologies turn traditional warehouses into smart and efficient hubs, making operations smoother and more reliable. Industry predictions indicate a significant potential for growth. From its estimated value of $3.6 billion in 2021, the market for robotic automation in warehouses is expected to soar to $18 billion by the year 2025.

Smart Warehouses: Smart warehousing is gaining momentum in 2023. Warehouses now use Internet of Things (IoT) devices and sensors throughout their infrastructure. These devices provide real-time data on inventory levels, environmental conditions, and equipment performance. Artificial intelligence (AI)-powered technologies further enhance warehouse operations, enabling proactive maintenance, accurate inventory management, and improved safety measures. These advancements lead to better overall efficiency.

The Evolution of Warehousing in 2023 Meeting Modern Demands

Warehouse Management Systems (WMS): Warehouse Management Systems are playing an increasingly crucial role this year. WMS solutions are evolving to integrate with emerging technologies, providing end-to-end visibility, efficient order processing, and seamless inventory tracking. Cloud-based platforms and mobile applications allow warehouse managers to remotely monitor operations and access critical information anytime, anywhere.

As we venture further into 2023, the warehousing landscape continues to evolve, driven by advancements in technology and ever-growing consumer expectations. Warehouses are undergoing a significant transformation to optimize operations, boost efficiency, and deliver seamless customer experiences. The adoption of automation, robotics, and AI-powered technologies is revolutionizing traditional warehouses into smart and efficient hubs. Additionally, the integration of IoT devices and sensors, along with the evolution of Warehouse Management Systems, enables real-time data analysis, proactive maintenance, and seamless inventory tracking. With these advancements, warehouses are well-equipped to meet the ever-increasing demands of modern supply chains.

Ready to optimize your warehousing operations this summer? Look no further than US Cargo Link! Our dedicated team is committed to providing top-notch warehousing solutions tailored to your unique needs. Check out our warehousing service here!

IoT – Hit or miss?

As discussed in our recent blog IoT and the 4th Industrial Revolution, the transportation industry is the second- largest segment investing in the IoT (internet of things). The question now is, are these new mobile devices and technology advances helping prove their ROI?Banker, Cunnane, and Reiser recently published an article discussing how some of these technologies sound like great ideas, but create no real ROI. They describe it as “ideas that have much hype, but no real sense of actual profit”.

UniversalIoT can help in so many different ways, but what we really need to focus on are the ways it can impact how carriers, shippers, 3pl, and freight brokers will approach business moving forward. It’s all about the dollar signs. All the new “shiny” technology may sound exciting, but if the cost is more than it’s worth, what’s the point? What’s the point of looking smart if you go broke in the process?

Many products including AI, Blockchain, delivery by drone, and autonomous vehicles sound very impressive, but we need to dig deeper as Jeff Berman suggests.

Recent studies have shown that drone logistics is less than 5 years away from becoming a reality. The global drone logistic market is listed as a million US dollar value in 2019 and in 2025 as stated by Rohit. However, with winds, weather, algorithm, and outside error probabilities, the drone just looks promising. Promising meaning high in performance, but still too young to verify all the benefits as suggested by ARC’s 2020 Supply Chain Technology Maturity Curve.

Although we anticipate the IoT can make our lives much easier in the logistics world, we must truly evaluate weather we’ll receive a profit from these pricey technologies and in the meantime continue to fully utilize the traditional forms of business + impeccable customer service that has gotten us to where we are today in logistics.

Don’t forget to sign up for our e-newsletter so you can get the best of our blog on a monthly basis straight to your inbox!

We offer competitively low prices, end-to-end solutions, and one-on-one attention for every client– large or small. Contact us today to see how we an fulfill your logistics needs!

Top 3 Logistic Trends for 2020

2020 is here and now it’s more appropriate than ever to study up on the most popular trends to prepare for possible new challenges within the new year.  We are currently in a highly transformative era in which experts are dubbing, “The 4th Industrial Revolution”.  Technology is advancing in an exponential rate and businesses are shifting priorities to keep up with the competition and the ever changing landscape of this industry.  In this post, we will explore the top 3 logistic trends for 2020.

#1 Sustainability and Visibility

More and more logistics companies are integrating sustainability efforts into their overall strategy.  Climate change has become a popular public concern, and everyone wants to do their part especially since the logistics industry plays a large part in greenhouse gas contributions right next to energy/power plants.  The idea of “going green” has embedded not only the minds of consumers, but political, economic, and financial leaders as well.  While green logistics is ideal, it is not an easy feat.  Not everyone has the resources to become net zero carbon which is why visibility and sustainability go together in this trend.  Logistics companies are providing more visibility in their operations so everyone—inside the company, and out—has access to information that would reveal issues that may otherwise remain hidden.  Things like empty miles, dwell time, trackability, etc. 

Related articles: The Impact of Weather and Climate on Logistics; Visibility is the Master Key to Solve Most Challenges in Logistics.

#2 Utilization of Advanced Technology

Technology has been advancing at an exponential rate.  We already have drones and self-driving semitrucks making deliveries.  Soon, everything that we can automate and digitalize will be automated and digitalized.  Robots are becoming more intelligent.  Not only can they perform simple tasks, but they now have the capabilities to learn, recognize patterns, make decisions, and adapting independently.  The developments on artificial intelligence (AI) are particularly important in the logistics industry because eventually, it’ll become and important tool for efficiency.  It will be no surprise to us when AI dramatically influences the transport industry and change the traditional processes of freight forwarding. 

Related articles: Advancement in Logistics: Technology vs Humans

#3 Managing Customer Expectations and Partnerships

With the implementation of advanced technology, many companies will be looking for ways to minimize freight costs while still being efficient in their operations.  In 2020, companies will be seeking out effective partnerships that can help reduce costs, minimize risks associated with shipping cargo, decrease delays in delivery, and enhance customer value and satisfaction.  Customer expectations will be shifting due to the advancement of technology.  Not only will customers become data-enabled but they will also be wanting to associate themselves with a business that aligns with their individual ideals.  Catch-all solutions will be obsolete, and companies would have to rely on transparency and technology to give them that competitive edge. 

Related articles: What’s the Difference Between Customer Experience and Customer Expectations?; Is Customer Experience Growing in its Importance in Differentiating Brands?

Don’t forget to sign up for our e-newsletter so you can get the best of our blog on a monthly basis straight to your inbox!

We offer competitively low prices, end-to-end solutions, and one-on-one attention for every client– large or small. Contact us today to see how we an fulfill your logistics needs!

Top 3 Tips to Keep up with Holiday Demands

The busiest season in logistics is undoubtedly during the holidays.  It requires a lot of planning and attention to detail.  If you don’t already have a game plan, it may already be too late as inventories increase as early as August in anticipation for the end-of-the-year bustle.  In this blog, we’ll cover the top 3 tips to keep up with holiday demands.

Tip #1 – Take the Initiative and be Proactive

Every year, the average consumer spends around $800 for gifts, shopping as early as October.  Companies must be in constant communication with their carriers as they will be in high demand over the next few weeks. In 2013, Amazon sold more products than they initially anticipated, making UPS, Fed-Ex, and other partners struggle to keep up with the demands.  In fact, many packages that year did not make it in time.  UPS and FedEx actually deal with a lot of outside carriers prior to the holidays for extra transportation support which is why communication and reassuring capacity concerns are being addressed is so crucial during this time. 

Tip #2 – Go over Last Year’s Results

Re-familiarize yourself with last year’s numbers and recognize all the wins and losses from that year.  Have a meeting with your team to go over what went well, and what could’ve been done better to avoid making the same mistakes this year.

Tip #3 – Embrace the Chaos

While it is important to always have a plan B, C, and D during the holidays, recognize that operations aren’t ever going to be perfect during this time of year.  You can always set deadlines earlier and plan for increased staffing needs to compensate for any foreseeable delays but, things are going to be hectic! All that will be in your realm of control is to be prepared, plan well, and stay flexible. 

Don’t forget to sign up for our e-newsletter so you can get the best of our blog on a monthly basis straight to your inbox!.

We offer competitively low prices, end-to-end solutions, and one-on-one attention for every client– large or small. Contact us today to see how we can fulfill your logistic needs!

[OPINION] Is Amazon Taking the Right Steps?

Amazon is still shaking up traditional logistics as we know it since we last spoke about it.  Shortly after our last blog post about them, Amazon workers went on strike for Prime Day.  Two months ago, Amazon workers walked out again for climate strike.  Finally, last month Amazon announced they will be cutting ties with delivery companies linked to deaths resulting in more than 2,000 workers across eight states to be laid off. Yet, even with all these protests, walkouts, and bad publicity, Amazon has managed to stay in headlines of logistics news over new, exciting initiatives introduced this year.

Today, we’ll dive into the two highly publicized worker strikes Amazon experienced, the motivations behind them, and the new initiatives announced presumably as a response. We’ll also analyze the implication of the most recent mass lay off to hopefully answer the question: Is Amazon taking the right steps?

It is hard to discuss logistics news without acknowledging the omnipotent presence that is, Amazon.  Amazon has grown from an online bookstore to an e-commerce dominator where the smallest changes sends tidal waves changing the landscape of all other e-commerce, retail, and logistics business everywhere.  Let’s first talk about the July 16, 2019 Prime Day Worker’s Strike.

The Prime Day Worker’s Strike, though highly publicized, was not as successful as it was originally anticipated despite many social media posts from customers expressing that they would not divulge in the sale to stand in solidarity with Amazon’s employees.  Prime Day is one of Amazon’s largest sale outside of Black Friday/Cyber Monday with the ability to rake in up to $5.8 billion, globally in one day.  In the end, only 7 sites across Germany and Shakopee, Minnesota participated in the strike. 

The motivation for these strikes were sound.  Unions are much stronger in Europe, and German Amazon workers routinely strike during huge shopping events like Prime Day often because of low wages, inhumane working conditions, and almost impossible standards/quota.   More than 2,000 workers participated.  Minnesota’s motivation was more or less the same except Shakopee has a sizable group of East African Muslims as employees that claim even though they are federally allowed breaks for prayer, taking those breaks makes it extremely difficult to meet their quota.  With Prime Day coinciding with Ramadan, most find it practically impossible to fast and pray in their work environment.  It is already common knowledge that with low wages and individual religious practices aside, Amazon employees are often assigned so much work, it is already a difficult to find time to go to the bathroom without throwing their entire day completely off.  Even with Amazon’s raise of “industry-leading pay” to $15/hour for all full-time employees, a lot of workers are still fighting for job stability and full-time status to receive that rate of pay. Almost all who participated in the strike had the time taken off from their allotted 20 hours unpaid time off, of which if they surpassed, is grounds for termination.  Amazon went on record to say “roughly 15 associates” participated in the Shakopee protest though other news sources reported up to 78 participated.

In the end, the result of 2019 Prime Day Workers’ Strike barely put a dent in Amazon’s bottom line.  Considering there was a workers’ strike last year, this year’s strike was further propelled by Amazon’s announcement of their one-day prime shipping. 

Then, there was the thousands of Amazon employees that walked out for climate strike.  Amazon is arguably one of the least sustainable companies because e-commerce is inherently less green than traditional retail stores because of transportation emissions.  Amazon worsens it by utilizing van deliveries instead of full truckloads.  Currently, none of the vans are electric either.  However, strategically the day before the scheduled climate change strike, Jeff Bezos unveiled a climate plan for Amazon with the end goal of reaching net-zero carbon emissions by 2040 and purchasing 100,000 electric delivery vans starting in 2021.  The question still stands: Is this enough?

Amazon has also since added an “Amazon Day” shipping option that allows the customer to select one day of the week to consolidate all their purchases throughout the week to deliver on the selected day with the least amount of packaging as possible for waste reduction. However, this is an opt-in service and not a default setting at check out.  Yet, when customers choose to opt-in, they are eligible to receive digital credits. 

Is Amazon Taking the Right Steps

While these two sustainable initiatives sound great, it Is also worth mentioning that earlier this month they have announced that $1 items can be delivered for free with this one-day shipping as well.  Previously, an order that was under $25 was not subject for free prime shipping.  That is all about to change with huge ramifications for one-stop grab-and-go retailers like drug stores.  There are other implied ramifications…

On October 11, 2019 Amazon announced that they will be cutting ties with a few of their delivery-service partners (DSPs) because of deaths resulting in more than 2,000 layoffs. You can find the list of layoffs here. This does not come as a surprise since Amazon hold their DSPs to a standard of delivering an upward of 300 packages a day. This is not the first time Amazon has decided to terminate contracts with delivery firms on short notice. Amazon has disclosed that has around 800 delivery firms under contract and at least three Amazon DSPs have filed for bankruptcy since 2018. Since 2014, Amazon has contracted DSPs rather than hiring their own drivers and control a lot of the delivery process. That being said, they also deny any and all liability when people get hurt. It is speculated by Business Insider that “the layoffs could be a sign that Amazon is moving to rely more on these newer, smaller companies over its older partners.” However, smaller and newer 3PLs have no experience in delivering the quantities Amazon expects and may even rely on loans from Amazon to get started. Amazon essentially controls the financial wellness of all these 3PLs without ever being responsible to pay their DSPs’ drivers wages and benefits. This year in 2019, Amazon has become it’s own largest delivery provider surpassing even USPS.

So, is Amazon taking the right steps?

It is an opinion that Amazon is trying to do too much at once.  It’s hard to wrap your head around strategies for a such a large and wealthy company like Amazon.  Seemingly all set goals are reachable but also….contradictory.  It is possible for a company like Amazon to reach net-zero carbon emissions by 2040 since so many companies are already there right now. For example, Unilever, Apple, and soon, Ikea.  However, I do tend to side with the opposing idea that it is not soon enough, and they should be pushing for 2030 especially with their recent introduction of $1 and one-day Prime shipping.  Even though 100,000 electric delivery vans sound better than 20,000 gas powered delivery vans, their “Amazon Day” shipping is still not the default setting during checkout and the incentive to opt-in seems lackluster.  It’s almost as if every time they find a solution for one hot button issue, they counteract it with another premium service literally nobody asked for.  Their recent shift from older and larger partners to smaller 3PLs suggests their interest still lies in self-preservation and maybe to take advantage of smaller DSPs with their continuation of denying safety liabilities and exploitation of workers. Considering absolutely everything, Amazon must sort out its internal issues and focus on the wellness of their employees before trying to heighten their customers’ experience and expectations further.   

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