Retailers are experiencing many store closures in 2019. This continues the massive store closure trends in recent years. The “retail apocalypse” has closed tens of thousands of stores across the United States, including hundreds of shopping malls. In 2019 alone, retailers have closed 6,000 stores. Only 2,641 new retail stores have opened.  

Despite these numbers (and the word ‘apocalypse’), retail numbers aren’t declining. Just because more storefronts are closing doesn’t mean that people are shopping less. Retail sales are still up, especially for e-commerce. Companies that can provide customers with a good online experience perform much better than companies who resist change. These companies will stay in business – and will continue to need transportation.  

Is E-commerce Good for Trucking? 

The retail industry is in a transition period, and so is the freight industry. E-commerce stores face logistical challenges in moving their goods from producer to consumer. They rely on trucking to complete that task. However, the supply chain looks different for e-commerce than for traditional retail stores.  

The rise in e-commerce has meant higher freight volumes, but they are moving faster and are not traveling as far. Less-than-truckload (LTL) shipping and parcel shipments are becoming more popular. These shippers have benefitted from the retail apocalypse.  

Length of haul is decreasing over the years as e-commerce retailers open more distribution centers. Trucks aren’t taking shipments to each store but instead to a distribution center, where parcel services manage delivery to the customer.  

Additionally, the e-commerce landscape is dominated by mega companies like Amazon and Walmart. These companies are generally looking for the cheapest option possible to transport their freight rather than using dedicated carriers. Instead, they only use core carriers and dedicated carriers as a last resort when freight brokers cannot find a better deal on the open market. This has made carriers wary of working with these big clients who only care about costs.  

How Truck Lines Can Transition 

The shift to e-commerce is not bad for trucking. Like the retail companies themselves, they need to think differently about what their business looks like. 

When these stores close carriers who mostly work with these large retailers are harmed, but they can adjust. They can add more clients to their client base to avoid being stuck when a retailer goes out of business.  

Carriers are also well positioned to help retailers with logistics. Customers expect their goods to arrive fast. Carriers can offer many shipping options to meet last-mile needs. 

E-commerce shows no sign of slowing down. As more distribution and fulfillment centers open, and customers expect goods even faster, retailers will still rely on shipping to run their business. Truck lines that are able to change with the times will perform well.  

TransCredit can help you ensure your business is ready to handle whatever changes come your way. Contact us today and let us help you with your credit needs.