Can AI Gains Give Alternative Delivery Providers an Edge?
As FedEx and UPS retreat from lower-yielding volume, alternative carriers like SpeedX, UniUni, and Veho are deploying AI tools—from chatbots to delivery photo verification and routing optimization—to gain a competitive edge. Experts say AI helps level the playing field, but human drivers remain essential.
Editor’s note: This story is the third in a three-part series about how parcel delivery providers are using AI to strengthen their operations and service performance. Read the previous installment here.
Alternative parcel carriers are increasingly turning to artificial intelligence to streamline operations, improve customer experience, and introduce new service offerings that help them stand out in a competitive market. While AI adoption has been gaining momentum across the industry for years—with FedEx and UPS among the leaders in using the technology to boost operational execution and enhance customer visibility—the rapid advancement of AI applications and their relatively low cost of entry are now helping smaller players narrow the gap with national carriers.
Jeremy Tancredi, a partner in West Monroe's operations excellence practice, told Supply Chain Dive that AI-powered tools are advancing quickly and no longer carry a hefty price barrier, which is aiding alternative parcel carriers in their efforts to compete more effectively. These companies have grown quickly in recent years as FedEx and UPS shift away from lower-yielding delivery volume.
Alan Amling, former VP of corporate strategy at UPS, agreed that AI can be advantageous for emerging delivery providers in their race to gain market share, at least from a technological standpoint. "AI is going to help close the advantage that UPS and FedEx have had, where they're able to outspend on technology and create a technology advantage around decision making and customer service," said Amling, who is now an assistant professor of practice at the University of Tennessee, Knoxville.
SpeedX deploys AI chatbot, delivery photo verification
Some parcel carriers are leaning on in-house AI tools to strengthen customer service. SpeedX built its own AI chatbot for consumer inquiries after failing to find a suitable third-party provider, according to Anthony Pizza, VP of growth and innovation at the carrier. The chatbot has helped handle over 80% of inquiries initially directed to the company's customer service team, Pizza said. The bot is integrated with other company systems, feeding it information it can use to help a consumer resolve an issue.
"The North Star for AI in last mile is around minimizing delivery failures," he said.
Validating drivers' proof-of-delivery photos is another way SpeedX is using AI. The company leverages a machine learning model it created to verify photos submitted by drivers, ensuring each package was delivered to the correct location and in the proper spot at that location, Pizza explained. "When a [proof of delivery photo] is actually uploaded into the system or actually taken, we're able to put it on a map and say, 'Hey, this was taken within X amount of meters from the GPS coordinates of the location,'" he said. The tool is particularly useful given the wide range of location types SpeedX delivers to, from apartment buildings and condo complexes to business-to-business addresses, Pizza added.
UniUni also uses AI to validate drivers' proof-of-delivery photos, helping ensure they bring each package to the proper location, Sheila Berry, UniUni chief revenue officer, said during a panel at Home Delivery World 2026 in Nashville last month. The carrier is also incorporating AI into its pricing practices, enabling quicker turnaround of rate proposals to customers.
AI boosts Veho's delivery flexibility
For alternative carrier Veho, AI is a pathway to increase options for shippers. In February, Veho announced the launch of FlexSave, which offers shippers cost savings in exchange for broader delivery windows. FlexSave is powered by MaestroAI, a Veho platform that optimizes fulfillment, batching, and routing decisions, per the announcement. MaestroAI can also factor in each package's specific service requirements to determine whether to speed up or slow down a delivery within its network for improved efficiency.
The internally developed platform helps Veho find the most cost-effective method to accomplish a delivery while still meeting particular service requirements, Veho President and co-founder Fred Cook said. He noted the complexity of handling multiple packages from retailers, with service requirements varying by package, as a challenge simplified by MaestroAI.
Veho's goal with MaestroAI is to unlock more optionality for shippers, enabling them to test and deploy different speeds for different customers as Veho enables more features on its platform, Cook said. For example, a merchant could launch a customer loyalty club in which members get faster package deliveries from Veho by default, aided by MaestroAI's capabilities. "Allowing retailers to personalize the speed that they're going to go with is a huge goal of what we're rolling out here," Cook said.
As alternative carriers continue to make AI-driven leaps—from chatbots to flexible delivery services—improving the human-driven aspect of operations still remains critical, experts said. "Unless you're running robotics and drones at scale, which nobody is, there's still a human making that delivery," Pizza of SpeedX said. "So how can we as a company leverage AI to make that person's life and experience delivering that parcel as simple and seamless as possible? That's really what it comes down to for us."