FedEx to Deliver Packages 7 Days a Week
May 30 2019 - 10:36AM
Dow Jones News
By Paul Ziobro
FedEx Corp. will deliver packages seven days a week starting
next year, adding an extra operating day to accommodate America's
online shopping habits.
The delivery giant also plans to carry more of the packages it
had deposited into local Post Offices to bring to doorsteps. The
shift will build density along FedEx Ground routes to lower costs
while also shifting some 2 million packages daily out of the U.S.
Postal Service's network.
The changes aim to serve an e-commerce shopping market where
consumer habits don't mesh with working schedules, since many
deliveries arrive at homes while shoppers are at work. It also adds
capacity to FedEx's network by using existing facilities an extra
day to handle what the company expects is a doubling of small
package shipments in the U.S. by 2026.
The change comes at a time that FedEx's traditional Express
business of rushing deliveries by jet across the country or globe
has slowed. Amazon.com Inc., Walmart Inc. and many other retailers
have expanded their warehouse networks, adding locations near more
U.S. cities where they can store goods and ship them shorter
distances.
"Expanding our operations to include Sunday residential
deliveries further increases our ability to meet the demands of
e-commerce shippers and online shoppers," FedEx President Raj
Subramaniam said.
FedEx plans to shift to seven-day a week operations in January
for a majority of the U.S. population, following the holiday
shopping season where it typically delivers packages every day to
handle the seasonal surge.
The company didn't disclose the financial impact of its
plan.
FedEx this year shifted to six-day-a-week delivery operations
after the recent holiday season, an expansion that has added
significant costs.
Rival United Parcel Service Inc. in recent years has shifted to
six-day a week delivery. During last year's bargaining contract
with unionized workers, UPS added lower-tier pay for delivery
drivers to work on weekends, although it doesn't currently deliver
on Sundays.
A UPS spokesman said the company is "constantly assessing when
it makes sense to expand current capabilities and operations."
The U.S. Postal Service, meanwhile, is considering expanding
package delivery to seven days a week. It currently delivers
packages on Sundays for Amazon.com year round and for other
shippers during the holidays.
A USPS spokesman declined to comment.
To build density along routes, FedEx will keep more of the FedEx
SmartPost packages it gives to the Postal Service. In recent years,
FedEx has used technology to keep such packages in its network if a
FedEx driver was headed to a nearby address.
Currently, about 20% of SmartPost packages are delivered by
FedEx instead of the Postal service. By the end of 2020, FedEx
expects the vast majority of these packages to be integrated into
its network.
Write to Paul Ziobro at Paul.Ziobro@wsj.com
(END) Dow Jones Newswires
May 30, 2019 10:21 ET (14:21 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
Walmart (NYSE:WMT)
Historical Stock Chart
From Apr 2024 to May 2024
Walmart (NYSE:WMT)
Historical Stock Chart
From May 2023 to May 2024