Report: Nearly half of SMBs will increase shipping spend in 2020

Nearly half of small- to mid-sized businesses (SMBs) will increase their shipping spend in 2020, according to a study of SMB logistics and procurement decision makers, released Wednesday.

The "2020 SMB Shipping Strategies Report" surveyed more than 500 decision makers between November 22 and December 4, and was conducted by online shipping marketplace uShip in conjunction with third-party research firm YouGov. The survey highlights the growing importance of shipping and logistics in the SMB sector and underscores the influence of big-box retailers' strategies on their smaller counterparts, the researchers said.

According to the study results, 47% of SMBs said they will increase their shipping spend in 2020 compared to 2019. In addition, a quarter of respondents said the logistics strategies of large retailers such as Amazon and Walmart are influencing how their company thinks about shipping, and 27% said those strategies are affecting how their customers think about shipping.

"The decisions of small and mid-sized business owners are being heavily influenced by the rise of big-box retailers like Amazon,"  uShip CEO Kris Lamb said in a statement announcing the survey results. "So, SMBs are beginning to rethink how they invest their shipping and logistics dollars. Our hope is that these insights convey the pressure being felt across the industry and to think about new ways to incorporate supply chain and logistics strategies into their business."

The survey also asked where SMBs are investing their shipping and logistics dollars: in personnel or technology? Twenty percent of SMB decision makers said they would rather invest in the right logistics team over technology, while nearly 30% said they plan to make new technology a priority. Just 14% of SMB decision makers said that investing in new technology is too expensive; 17% said they prefer to invest in alternatives to the traditional shipping options of UPS, FedEx, XPO Logistics, and freight brokers.

The survey also found that SMBs struggle when it comes to finding the best shipping options for large, bulky, or fragile items. The researchers said that: 

• 17% don't trust fragile items to arrive safely or unbroken.
• 15% can't find a reliable carrier to ship oversized and bulky items. 
• 12% can't find an affordable shipping solution.
• 11% don't know where to find alternative shipping options to organizations such as UPS, XPO Logistics, and freight brokers.