Despite having the worst name in the shipping industry, Ontrac has survived and thrived in the business. OnTrac is operating profit rather than being a loss-making business.
Almost all the time their official site remains unavailable, tracking numbers are often wrong, and if the recipient has some issue, they can’t contact their customer care representative.
But how OnTrac has managed to remain in the business despite all these challenges? Here, in this article, we have tried to cover all the reasons why OnTrac is still in the business.
Reasons Why OnTrac Is Still in the Business
Low Rates
OnTrac is the cheapest shipping carrier that provides last-mile delivery service at a very low price compared to its competitors like USPS, UPS, and FedEx. It’s one of the main reasons why the company has survived despite providing the worst service in the shipping industry.
This has given them tremendous growth and they have partnered with many small brands as their shipping carriers so they can be in the business for the long run.
Its competitive pricing attracts individual and e-commerce businesses that want to save a significant amount of money in shipping fees.
Regional Focus
Despite providing their service all over the US they are majorly focused on the western parts which has given them an edge compared to their competitors such as USPS, UPS, and FedEx.
This has allowed them toward any direct competition from their competitor while becoming a regional-dominated player in the western region. This has given them a stronghold in these states as major brands prefer to work with them despite their poor shipping service.
Partnerships
Surprisingly OnTrac has partnerships with many popular brands such as Walmart, Nike, Adidas, Best Buy, Fashion Nova, and Shein. They have started using OnTrac as their leading shipping partner, especially for the west side of the US.
As most of the customers offer to these brands in almost all cases OnTrac is their shipping partner for the west side and in doing so they have made an annual revenue of around $400 million.
Low Operational Costs
Many OnTrac drivers have complained on Reddit that they were very poorly until they had to resign or find work somewhere else. OnTrac pays around $13 an hour and doesn’t provide any other benefits to the drivers. They have to pay for their gas and maintenance of the delivery vehicle and what is left, is their earning for the month.
Almost all the company drivers work as contractors, meaning they don’t have any more benefits than their paychecks.
In this way, the company keeps most of the profit and bearly provides enough to keep the business afloat.
Stronghold With Shippers
The Company may be the worst shipping carrier for the recipients but that’s not the case with the shippers.
At the time of delivering the package, they usually click a photo as evidence that they have delivered the package along with the signature of the person who has signed the documents at the time of delivery.
If the recipient complains that they haven’t got their package then the on truck provides them the photo proof along with the signature that they have successfully delivered their package. Along with that they also send the proof of delivery to the shippers so they can be successfully updated about this situation.
By doing this OnTrac usually tries its best to clear its name with the issue of package delivery.