In Rural US, E-Commerce Comes at a Cost

Sep 15, 2016

Packages at the post office in Mangum, OK

E-commerce is transforming rural America in a lot of ways. In small towns, big-city conveniences are now only a click away. But, as The Wall Street Journal reports, the change comes with a price.

Seventy-three percent of rural consumers are now buying online. But while e-commerce is great for small towns, it’s expensive for retailers and delivery companies. Longer drives and fewer packages per stop mean lower profits for the U.S. Postal Service, UPS and FedEx. These delivery companies charge an extra $4 per package for remote residential deliveries. And that extra cost for rural deliveries adds up quickly for retailers.

This can mean trouble for many retailers, which have turned to e-commerce because they were losing in-store profits to other online retailers.