It gets a lot of supply chain professionals riled up: FedEx and UPS. That is, the duopoly, at least in North America, of the two dominant shippers.
The electronics supply chain leans mostly on parcel ground shipping for its parts, and so price increases or capacity issues with the Big Two cause widespread ripples. Just as Danny Stephens, Avnet's vice president for global transportation, points out in a recent interview with EBN, the two shipping giants raise their prices about 4 percent to 5 percent every year. They attribute the increases partly to their continued investments in technology.
But smaller companies — and even some larger ones — that do business with the two dominant shippers might question how much technology they really need. The bigger companies can absorb that 4 percent to 5 percent impact or negotiate to lessen it, but it's much harder for small to midsized companies to absorb the increase or pass it on.
Of course, one opposing view of the shipping duopoly holds that UPS and FedEx, as two strongly positioned players, can be much more cost-effective and provide better services (plus the ever-improving technology they tout).
Which side of the argument do you fall on? While you ponder that, take a look at this infographic that offers a compare and contrast of the Big Two: