Dinesh Dixit, vice president of account management with LogiNext, describes the challenges that parcel companies are facing today, and how technology might ease their pain in the coming months and years.

The biggest challenge facing parcel and courier companies today is “the capacity problem,” Dixit says. The COVID-19 pandemic supercharged e-commerce, causing a dearth of truck space in the face of surging demand. Some carriers were even forced to reject loads for the biggest retailers because they didn’t see “the cost-benefit” of hauling the freight.

In response, a number of smaller service providers rose up to supplement the parcel-delivery sector, but they could only handle so much of the business. Among the major obstacles to scaling upward has been a persistent lack of labor — the so-called Great Resignation, coupled with an unwillingness to work in logistics jobs specifically. And if workers are, they’re more likely to be part-timers or independent contractors without loyalty to a particular company. “People are not willing to drive long hours,” says Dixit.

Courier companies are responding by attempting to gain better visibility into packages in transit, and where trucks are going. Part of the answer lies in the increased use of technology, including the use of drones and driverless vehicles. But these innovations are far from ready for regular use; Dixit predicts that it will take five to 10 years for commercial implementation to take hold. Meanwhile, regulators need to catch up in overseeing new methods of delivery, especially those related to big rigs and trailers.

Early implementations of drone technology will likely be in rural areas, where there’s a need to cover long distances while not encountering severe traffic congestion. And drones can only carry limited volumes. “It’s definitely happening,” Dixit says of these innovations, “but not in the near future.”