are finally right for the long-standing single-carrier model to give way to a truly diversified, multi-carrier ecosystem.
THE RISE OF ALTERNATIVE CARRIERS: WHAT SHIPPERS SHOULD KNOW
F
By Thomas Andersen
or decades, two major players have defined the parcel landscape, but that balance is changing. As UPS and FedEx prioritize margin optimization over market share, a new wave of alternative options, including regional, tech-driven, and hybrid networks, is gaining traction. The result: greater complexity for shippers, but also more opportunity. A More Crowded Playing Field UPS and FedEx built networks that set the industry standard for reliability. Their infrastructures remain unmatched, but their strategies have evolved. Both carriers are now laser-focused on profitability, frequently adjusting surcharges, rates, and fees. The once-predictable rhythm of annual rate updates has given way to a volatile pattern of mid-cycle changes, now occurring with increasing frequency and little notice. This constant recalibration has introduced volatility, pushing many shippers to seek predictability elsewhere. In response, regional carriers and tech-driven solution providers are stepping in, promising lower rates, simpler fee structures, and faster local or regional coverage. For many shippers, the conditions
26 PARCELindustry.com NOVEMBER-DECEMBER 2025
The Expanding Alternative Network The most visible recent example is OnTrac, which has evolved from a regional operation into a near-national network. Its upcoming Express and Ground Essentials services, launching in 2026, promise coast-to-coast delivery coverage and as much as 30% lower costs than legacy economy services. By eliminating several common surcharges, OnTrac is positioning itself as a compelling, lower-cost option for small and midsize businesses seeking predictability and control. Amazon Logistics continues to expand its influence as well. The company’s Multi-Channel Fulfillment program now supports merchants selling on Walmart, Shopify, and Shein, signaling a shift from an internal logistics arm to a full-fledged parcel carrier. With unmatched fulfillment density and delivery reach, Amazon has become one of the largest parcel networks in the United States. Smaller entrants are also scaling quickly. Veho, an e-commerce delivery platform, recently expanded capacity across 15 markets ahead of peak season to meet “retailer demand for flexible, same-day solutions.” Similarly, UniUni, a Canada-based carrier, has launched US operations to connect cross-border networks with affordable ground delivery. Together, these developments highlight a clear trend: the long tail of parcel carriers is lengthening, offering shippers more choice, flexibility, and leverage than ever before. Strategic Implications for Shippers For many organizations, regional and alternative carriers can yield 20% to 30% savings on select lanes or parcel profiles, while improving delivery performance in targeted regions. However, these advantages come with trade-offs. Reducing volume too sharply with FedEx or UPS can erode tier-based discounts or incentives, diminishing overall savings. The most effective strategy begins with data-driven market analysis. Understanding how current rates compare to market norms enables shippers to pinpoint which alternatives make financial and operational sense. For example, a company shipping lightweight residential parcels to short-zone destinations may gain efficiency by integrating a regional carrier, while maintaining its national provider for longer routes and international coverage. Ultimately, the goal is to balance the network for optimal cost, service, and resilience. How to Evaluate Whether Alternative Carriers Make Sense Exploring alternative parcel carriers can create meaningful advantages, but not every business will benefit equally. The right approach depends on a shipper’s profile, operational readiness, and technology infrastructure. Companies considering diversification should take a structured, data-informed approach: 1. Audit Your Shipping Profile: Identify which parcels generate the highest cost-to-value ratio. Lightweight, short-