By Jonathan D. Glater
Washington Post, June 28, 1993
It used to be that if lawyers wanted to deliver a document across townimmediately, they had no choice but to call someone, such as bicycle messengerRob Wilson, No. 160 at Action Courier Inc. of Arlington, to carry it.
Times have changed.
Relentlessly advancing technology, such as the fax machine and electronicmail, and an uncooperative economy may have forced many courier companiesto go the way of the dinosaur, those in the industry said. By one industryexecutive's estimate, the number of local courier companies has fallenby almost half in the past 10 years, to 167 from 300, and the consolidationis expected to continue.
Clients with their own problems, such as companies in the depressedreal estate industry, have drastically reduced deliveries. Accounting firmscan file tax returns electronically, and anyone can use express overnightmail or a fax machine. And because courier companies aggressively seekmarket share to stay afloat, if one company lowers its prices, the othersfollow.
"To try to gain more business, people are going and selling reallycheap," said Tom Avery, acting president of the Washington MetropolitanCourier Association and branch manager of one of the country's largestcouriers, New York-based Choice Courier Systems. "I used to be ableto go in {to a client} with a rate sheet," and now everything is negotiated,he said.
While the market accepted higher prices in the booming 1980s, said ScottForeman, owner of R&S Courier Inc. in Bethesda, "now firms wantdiscounts."
But many survivors have withstood the onslaught of the fax machine andelectronic mail. They have done it by improving their own technology sothey can receive orders electronically, and by expanding the range of servicesthey offer so they can manage a mail room or store a computer company'sspare parts.
The shakeout probably will continue, executives said. But they are optimisticthat they can survive if they try to improve the technology they use fordelivery of messages and packages so that their increased efficiency drawsmore customers, and if they use their delivery skills to branch out intoother services, such as overnight mail.
Just as pagers, two-way radios and computerized billing helped givesome messenger firms an edge in the 1980s, more frequent use of availabletechnology -- such as electronic placement of delivery orders -- will matterin the 1990s, said Kevin Holder, president of one of the District's largestcouriers, Washington Express Services Inc.
Some couriers are trying to provide specialized services for high-volumeclients, said Richard Hess, president of Falcon Express Inc. Falcon providesa manager and dedicated messengers for the law offices of the downtownfirm of Akin, Gump, Strauss, Hauer & Feld. This service gives the high-volumeclient its own "mini-courier company" to deliver and pick uppackages. A delivery costs the same per package as if there were no dedicatedservice, Hess said.
A few courier companies are moving into "third-party logistics."They hire out their services for specific tasks, such as providing a truckand driver to transport a package or letter. "This way the employerpays a flat amount" and doesn't have to worry if something goes wrong-- a flat tire, for example -- with a specific task, Avery said.
Third-party logistics can mean managing a law firm's mail room, storinga high-tech company's spare parts and delivering them within 30 minutesto a repair technician in the field or providing some other kind of service.In New York, Choice delivers parts to Xerox Corp. technicians so they donot have to carry several spare parts all the time and don't have to leavea site to get the parts they need, a Xerox official said.
Washington Express warehouses computer replacement parts for Sun Microsystems,Holder said. "We just deliver the parts when they need them,"he said. "They rent {space} , and we keep track of their stock."
Couriers have added these services because the tight economy has drivenclients to reduce their use of basic messenger services, say the ownersof courier companies. For example, real estate agents, hit hard by recession,have drastically reduced their deliveries. The same has happened with accountingfirms. "Before 1992, the biggest day of the year was April 15,"Holder said. Because of electronic filings and overnight express mail,"In 1992, it wasn't even a blip."
And competition in a shrinking market has driven couriers to keep droppingtheir prices, Holder said. While overhead costs for items such as the radiosand beepers couriers carry have risen, the prices of delivery have remainedstable, and by some accounts have fallen. A delivery from one downtownlocation to another costs about $5 now, compared with $7 in the mid-1980s,Holder said.
Smaller courier firms that cannot afford to provide the new serviceswhile keeping their prices competitive will not last, said Michael Katz,a member of the board of the Messenger Courier Association of the Americasand executive vice president of Choice. "People who are unsophisticatedwill be squeezed out," he said. He expects that there will be fewerfirms in the messenger business in the future.
It is difficult to keep an accurate count of the number of courier companiesoperating in the metropolitan area, or to get an idea of how many are survivingthe fax and the economy. There are no licensing requirements for couriershere as there are in some other cities, and it is easy for one companyto appear and another to vanish. After all, one person with a phone answeringservice, a beeper and a bicycle can operate a courier service, Katz said.
Such a courier would not be able to offer new, more sophisticated servicessuch as parts delivery, though. A courier without the computer and otherresources of a large company likely would be restricted to traditionalbusiness -- delivering packages that cannot be faxed or submitted electronically,and that must be delivered immediately. This includes legal documents thatmust be signed by several parties, replacement computer parts, photographs,architectural drawings and even medical supplies.
"Fax machines can't do books and filings," courier Wilsonsaid. Nor can fax machines pick up an attorney's dry cleaning -- a pickuptypical of the high-flying 1980s, Wilson said.
"We cater to those industries that can't use fax machines to maketheir deliveries," said Mark Gross, president of Quick Messenger ServiceInc. in the District. "Very few govermental filings are accepted electronically,"he said, adding that many clients who do business with Congress find thatthey get their message across more effectively by sending "hard copieswith live signatures."
For example, Gross said, "a lot of faxing to Congress ends up inthe hands of interns" and may not make it further up the chain ofcommand. So couriers, who deliver letters in person, have greater impact.
Packages carried by couriers now tend to be bigger, too, because shorterdocuments can be faxed, said Mary Ann Kennedy, owner of Republic ExpressCorp. in downtown Washington. Clients also choose to fax documents betweendowntown and the suburbs because of the higher cost of a delivery, Katzsaid.
Where the fax machine has really hurt couriers, Gross said, is whendocuments with numerous drafts are involved. Before, law firms might havesent couriers back and forth with each version of a brief; but now, onlythe final version, with original signatures, will be delivered by messenger.It is difficult to get a measure of how this has hurt any one firm becausenearly all are small and privately held.
Bicycle couriers, who make up about 40 percent of the area's messengers,can make more than $600 a week if they work hard. Such success dependson how many couriers a company has, so that a day's deliveries are notdivided among too many messengers.
Charles Lawrence, a bike courier for Metropolitan Messenger and DeliveryService Inc. and a messenger in the District for eight of the past nineyears, does 35 to 40 deliveries each day and rarely takes home less than$600 a week, but he is unusual. Now, he said, he has to complete more deliveriesto make the same amount of money.
A more typical bicycle courier will make $400 to $500 each week, with20 to 30 deliveries daily. For each delivery, a car or bike courier usuallycan keep half of the fee, so if a delivery from downtown to Capitol Hillcosts $7, which is fairly standard, the messenger gets $3.50. The averagelocal delivery is closer to $10, executives said. Couriers who drive tendto make longer runs in which traffic is less of a concern than it is downtown.
Another big shock for couriers will come when the government does notrequire original signatures, Foreman predicted. "When the judiciarysystem accepts filings electronically," he said, "that technologywill hurt everyone. But I don't see that happening before the year 2000."
To hear some bicycle messengers talk, this might not be such a bad thing."You got to be crazy to do this job," said Peter Kush, a messengerfor Action Courier Inc. "I have no idea how I got into this."
"It has good days and bad days," Wilson said philosophically."Pick up, and drop off, pick up ..."
Andy Zalan, a bike courier for a downtown firm, National Express Inc.,emphasized the positive: "I get to ride a bike," he said, "andit's good money."
All of them say they plan to keep delivering at least until the endof the year -- fax or no fax.
If you have comments or suggestions, email me at messvilleto@yahoo.com