7 Reasons Why a Major Parcel Carrier Might Not Be Best for Your Spare Parts Logistics Needs
If recent news is any indicator, COVID-19 has delivered a clear message to businesses — focus on your core competencies. A major parcel carrier recently announced they were selling off their freight department. Based on quotes from executives, this move is in direct response to the COVID-19 “focus” message. Global lockdowns in 2020 pushed a record number of consumers online, driving volumes for e-commerce shopping and deliveries higher than ever with no slowdown in sight. This carrier’s decision to jettison a non-core business is a smart move and we are excited for them. If you’re a high- technology OEM, your core competencies include delivering high-quality products and services, pre- and post-sale while optimizing costs. Service supply chain and logistics solutions are part of your post-sales offering but aren’t your core competency. You’ve probably spent a bit of time exploring companies who specialize in this area — companies like the one mentioned at the beginning of this article. If so, you might want to dig deeper and ask yourself:
- If e-commerce is their primary focus, will they be equally committed to serving you and your customers’ needs for mission-critical spare parts?
- If they were willing to sell their freight business as part of their overall business strategy, is their service logistics division (which is much smaller than freight) stable?
- Is service logistics a byproduct of their core business or a primary focus?
- How consistently do they meet 2- or 4-hour service level agreements?
Over the past six months, Flash Global has earned business from several top-tier high-tech companies who switched providers to partner with us — a company whose main focus is service logistics. Each decision was unique, but several common reasons were cited that motivated their switch from one of the larger e-commerce logistics and package delivery companies to Flash Global:
- Lack of global account management – each region had its own account manager, creating a “daisy chain” effect of communications and interactions. This was time-consuming and frustrating to manage.
- Spare parts logistics was not their focus – time and attention to issues were difficult to get, elongating resolution time and exacerbating time-sensitive issues.
- “Our way is the only way” – very little room for configurability or flexibility in delivery solutions, processes, or systems.
- Technology solutions were more generic in nature – global spares management has its own unique requirements that truly benefits from purpose-designed-and-built technology.
- Inconsistencies in service level performance – when e-commerce deliveries and Next Business Day is your core focus, 2- and 4-hour mission-critical deliveries can be challenging.
- Limited Global Trade (IOR/EOR) – limited as in scope as well as countries. This forces the use of other companies, leading to increased management overhead and customs delays.
- Global partner network not under “one” umbrella – different systems, processes, and connection points make it difficult to deliver a unified global service.
Focusing on core competencies is a strength, not a weakness. Making strategic business decisions to support your focus is crucial to achieving business success in 2021. Flash Global is laser-focused on our competency: service logistics.
If you’d like to learn more about how to up-level your post-sales support game, we’re here for you. Grab some time with us whenever you’re ready.