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Q1 2015 Delivers More Change for Shippers

Author pacejet on 4/7/15 5:58 PM

So far 2015 continues to be a year of big changes for shippers, carriers, and everyone in-between. Just this week, FedEx announced intent to acquire TNT in a $4.8B bid to expand their European services against competitors UPS and DHL. Excess capacity during a slightly weaker holiday shipping season put the hurt on some carriers but lower fuel costs are helping carriers and shippers. Carrier earnings news showed a boost from new dimensional weight rules as those rules start to bite into shipper budgets. And more ...


FedEx Looks to Acquire TNT to Boost Marketshare

FedEx announced intent to acquire TNT in a $4.8B deal to boost their international shipping services capability. Particularly for the international express market, the move will help FedEx (10% market share) compete with leaders DHL (41%) and UPS (25%) by adding the larger TNT (12%) share of the market. It will be interesting to see how European regulators view this move, since they blocked a bid by UPS to buy TNT last year.

Holidays and Winter Were Tough on Carriers

The unpredictable and ultimately lower demand in the 2014 holiday season along with a challenging winter made it tougher on carriers this year. UPS built up capacity this year to avoid re-occurrence of delivery problems that happened in 2013 and ended up denting earnings. FedEx had a better match on capacity for the holidays but was also impacted by the harsh winter season.

New Dimensional Rules and Fuel Both Boost and Bane

Although it's only been a few months, dimensional weight changes are starting to bite into shippers costs and show up in carrier bottom lines (for example, the change boosted FedEx yields by 3.7% in recent reports). Lower fuel costs seem to be helping all carriers this year, we'll see if that turns out to be an improvement that makes it through to shippers more fully as the year progresses.

More on the Mergers and Acquisitions Front

Another recent announcement included the news that Endicia is being acquired by Stamps.com for $215M in cash. The move appears to be intended to help Stamps.com diversify themselves beyond their consumer and SOHO shipper roots. Endicia has been a good partner to Pacejet and given our focus on integrating multiple carrier services directly into ERP systems, we expect to maintain a complementary position in the marketplace with Endicia and Stamps.com.

NetSuite SuiteWorld Looks Even Bigger in 2015

Details on the latest NetSuite SuiteWorld event are continuing to come out as the event shapes up to be a big one. As the largest Cloud ERP provider (perhaps arguably) with 24,000 business users, NetSuite will bring together at least 7,000 companies this year at the May event. If you haven't heard it already, Pacejet will be there showcasing our enterprise shipping solution "Built for NetSuite" in booth 737 --- stop by to "talk ship" with us.

Interested in Reading More?

Interesting in learning more? Here are some great sources for news on topics and companies that affect shippers:

  • FedEx Acquisition of TNT by New York Times (here).
  • FedEx Acquisition of TNT by USA Today (here).
  • Motley Fool on UPS and FedEx (here).
  • Motley Fool on UPS Holiday Issues (here).
  • Stamps.com acquisition of Endicia (here).
  • NetSuite announces bigger SuiteWorld (here).

Learn More About Pacejet

Pacejet is the first cloud-based shipping software platform and carrier network, delivering ERP-integrated shipping that helps businesses reduce costs and improve service. Contact us today at 877-722-3538 or via pacejet.com.

Topics: News

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