Increased Competition: Understanding Digital Disruptors

More and more businesses are expanding their services and creeping into territory that was once served primarily by the truckstop and travel plaza industry. Throughout the year, Stop Watch is examining specific groups that are entering this space, including dealerships, carriers’ distribution centers, big box retailers and turnpikes, how they’re changing and what NATSO members need to know about the category. Visit www.natso.com/increasedcompetition to see all of the articles.

E-commerce is on the rise and it is having a wide-ranging ripple effect on retailers and shoppers alike. Not only is e-commerce shaping what customers buy inside of physical retail locations, but it is also changing the supply chain, traffic patterns and the needs of over-the-road drivers while also increasing customers’ expectations of convenience.

Length of Haul
E-commerce is growing six times faster than bricks-and-mortar retail, and e-retailers are working to speed deliveries to shippers. In response, retailers and manufacturers are placing more distribution centers throughout the country so they can fulfill orders quickly. That has driven down the average length of haul in the dry van sector, which has dropped 33 percent since 2000, said Bob Costello, senior vice president and chief economist at the American Trucking Associations. Today the average is 533 miles.

“Since 2000 we started buying online. Bricks and mortars have had to adjust to that,” he said, adding that online sales have increased nearly 500 percent since 1995. “They have built more distribution centers around the country. They’ve gone from a handful to dozens but they’ve gotten closer to the source.”

That means drivers are spending less time on the road and have different shopping needs when they stop. What’s more, drivers, like other shoppers, may be doing more of their own shopping online. “For folks on the road, there may be even more inclination to shop online,” said Ken Cassar, principal analyst for Slice Intelligence. Cassar recently shared his expertise on e-commerce with NATSO’s board of directors.

“It is harder when you’re working— you can’t just pull your truck up to a shop. If you need to buy something, e-commerce does present a unique solution,” Cassar said.

Culture of Convenience
Ultimately, e-commerce is altering the way consumers think and creating a culture of convenience. As a result, a number of companies are developing creative solutions to make their customers’ lives easier. That could take market share from truckstop and travel plaza operators, said Darren Schulte, NATSO’s vice president of membership.

For example, fuel delivery services are keeping cars fueled without consumers ever having to visit a fueling station. Both Booster Fuels and Purple provide app-based fueling services that allow customers to schedule fill-ups at their convenience.

Schulte said NATSO members need to be aware of businesses that could take part of their business. “Just because you don’t have Purple near you today doesn’t mean you won’t have a new company that starts up,” he said.

While these types of services could create competition for truckstops and travel plazas, they could also create opportunities. “The goal of bringing the product to the consumer isn’t going to go away,” Schulte said. “Delivering fuel is something many of our members are already doing and this is an industry they are familiar with. This is the perfect opportunity for them to be a part of the disruption culture.”

Schulte said members could also consider delivering diesel exhaust fluid, providing mobile wash services and getting involved with food delivery services, such as Door-Dash and Grubhub, that focus on bringing products to the consumer. “Food and fuel are things we already do. We need to get engaged because we shouldn’t be allowing companies like Purple to go out and do the business in our space,” he said.

NATSO provides analysis that travel plazas need to udnerstand trends that are disrupting the industry, like ecommerce. Visit www.natso.com/digitaltrends to view a NATSO member only toolkit that identifies the implications that NATSO members need to be made aware of and how to adapt.

Mindy Long's photo

Mindy Long

Before launching a full-time freelance career, Long edited NATSO's Stop Watch magazine. Prior to that Long worked as a staff reporter for Transport Topics, a weekly trade newspaper, covering freight transportation, fuel and environmental issues. In addition to covering the transportation sector, Long has written, reported and edited for a variety of media outlets. She was the Washington correspondent for WCAX-TV (CBS) in Burlington, Vt., a criminal court reporter in Chicago and a freelance copy editor for Kiplinger’s Personal Finance magazine in Washington D.C. Long hold a master’s degree from Northwestern University’s Medill School of Journalism in Evanston, Ill., and a bachelor’s degree in Communications from Westminster College in Salt Lake City.More
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Stop Watch Magazine

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