Is 2-Day Delivery Too Slow?

Estimated reading time: 3 minutes

Great Expectations

Waiting for a package for three to five business days can feel excruciatingly long, especially as two-day delivery has become the norm with certain retailers.

We’ve been conditioned to expect shipments sooner, and expect lightning-fast deliveries, leading America’s retailers to overhaul their shipping processes to meet these expectations.

Shipping War

Amazon (AMZN), Walmart (WMT), and Target (TGT) are locked in a tight competition for shipping superiority. Years after its Prime program popularized 2-day delivery, Amazon remains the leader in this regard. But Target and Walmart are hoping new initiatives will help to close the gap.

Walmart is attempting to use automation in its warehouses to increase the speed of delivery to both stores and customers, and Target is also overhauling its warehouses to expedite shipping. But while these initiatives are intended to both speed up delivery and cut costs, they require massive overhead. Target alone has invested $100 million in augmenting its warehouses.

Meanwhile, Amazon’s new distribution model has packages arriving at Prime members’ doors faster than ever. It divides up the country into eight regions, making sure the customer’s orders are shipped from a warehouse located within their region.

Fierce Competition

The intense competition may raise costs for these retail titans in the short-term. But for consumers, more competition between retailers could prove positive, leading to better service, and in this case, better shipping conditions. Amazon is already increasingly offering same-day delivery.

At the same time, ultra-fast delivery also has an economic cost. Amazon gives buyers the option to receive fewer boxes by pooling deliveries, for example. But whether the desire for less paper recycling offsets wanting quicker deliveries remains to be seen.

Disclaimer
SoFi Securities (Hong Kong) Limited and its affiliates (SoFi HK) may post or share information and materials from time to time. They should not be regarded as an offer, solicitation, invitation, investment advice, recommendation to buy, sell or otherwise deal with any investment instrument or product in any jurisdictions. Keep in mind that investing involves risk, and past performance of an asset never guarantees future results or returns. It’s important for investors to consider their specific financial needs, goals, and risk profile before making an investment decision.
SoFi HK does not make any warranties about the completeness, reliability and accuracy of this information and will not be liable for any losses and/or damages in connection with the use of this information.
The information and materials may contain hyperlinks to other websites, we are not responsible for the content of any linked sites. The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi HK. These links are provided for informational purposes and should not be viewed as an endorsement. The risk involved in using such hyperlinks shall be borne by the visitor and subject to any Terms of Use applicable to such access and use.
Any product, logos, brands, and other trademarks or images featured are the property of their respective trademark holders. These trademark holders are not affiliated with SoFi HK or its Affiliates. These trademark holders do not sponsor or endorse SoFi HK or any of its articles.
Without prior written approval of SoFi HK, the information/materials shall not be amended, duplicated, photocopied, transmitted, circulated, distributed or published in any manner, or be used for commercial or public purposes.