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Shipping in the 21st Century

By Lawrence Reaves

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Published: 03Mar2012
Word count: 510
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Specialized package delivery services came about partly as a result of dissatisfaction with the U.S. Postal Service. Because the Postal Service essentially held monopoly over the business of shipping, rates were outrageously high. Wells Fargo was one of the first specialized shipping fleets, and certainly the most well known in the latter half of the 19th Century. After all, Wells Fargo was also providing banking, and this combination proved to be perfect for its time: the California Gold Rush. The demand for swift and secure transport of finances, communication, and sundries back and forth across the country quickly made Wells Fargo the leader in transport for fifteen years. The construction of the railway system made shipping even more efficient, and rates fell. By 1918, railway shipping services incorporated to form one firm: the Railway Express Agency.

The growing availability of low-cost shipping to more locations brought with it a boom in catalog sales. The shipping industry continued to evolve at different levels of cooperation with the USPS. Wells Fargo abandoned its shipping sector to focus more fully on banking, but the ubiquity of the motor vehicle brought with it a slew of motor freight services, including the United Parcel Service. UPS began as a specialized courier, but the construction of the highway system allowed the company to grow into a huge national enterprise. Meanwhile, shipping by rail became less practical, and the U.S. Postal Service's contract with the Railway Express Agency was dissolved and the REA went belly up. Air mail also took off in 1918, delivering sensitive materials quickly and safely. Federal Express revolutionized air freight in the 1970s with the hub and spoke model, where cargo is moved from remote locations to a central point and then shipped. The Airline Deregulation Act made it affordable and practical for Federal Express to ship packages and letters overnight nationwide. The Postal Service responded to this by implementing its own Express Mail service, as well as revamping the railway freight system of package delivery.

By the beginning of the 21st Century, consumers were able to choose from several shipping methods and various speeds and price points. UPS and FedEx cover their overhead costs with an array of small fees, as does the USPS. These fees increase with tracking services and delivery confirmation. Some online businesses absorb these costs, accounting for these expenses in their own mark-ups. The popularity of online shopping has driven a demand for fast, cheap shipping, regardless of fuel cost or other expenses. This demand has led to the necessity of shipping consolidators which run the last leg of the delivery process. For this reason you are able to return a package, or pick up a delivery you were unable to sign for at your local branch, regardless of the parcel service that delivered it. In fact, with the advent of the Smart Label system, where a return sticker is either included in the package, or available to print on demand, you only have to hand the package to your postal carrier.

Lawrence Reaves writes about shipping labels and asset tags for MaverickLabel.com

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