FedEx plans to deliver packages seven days a week starting next January as it tries to keep up with the continuing boom in online shopping.
David Koenig of the Associated Press had the news:
The company is also taking back nearly 2 million daily deliveries to homes that are currently handled by the post office in a move it says will increase the efficiency of its own network.
The Memphis, Tennessee-based company announced the changes Thursday.
It was just last September that FedEx expanded to six days a week for most of the year, although it had previously run on some Saturdays and Sundays around Christmas. Company officials said FedEx will add year-round Sunday service in urban and suburban areas that account for the bulk of U.S. population.
President and Chief Operating Officer Raj Subramaniam said the change will increase the company’s ability to meet the demands of online shoppers and retailers.
Paul Ziobro of The Wall Street Journal reported that FedEx hopes to build density on some routes:
With the change, FedEx plans to bring to customers’ doorsteps many of the packages it currently drops at local post offices. The shift will seek to lower costs by building density along FedEx Ground routes, while also shifting some two million packages daily out of the U.S. Postal Service’s network.
FedEx and rival United Parcel Service Inc. have invested heavily in recent years to manage the surge in e-commerce packages moving through their sorting facilities and long-haul networks.
Until recently, the companies have taken steps to outsource last-mile delivery to the Postal Service or others, worried that home deliveries would be less profitable than shipments between businesses. But as the volumes climb—to an estimated 50 million domestic packages a day—the companies are adjusting their operations to capture market share and handle weekend deliveries. They are also experimenting with more immediate delivery options. UPS has tested drone deliveries, while FedEx recently showed off a robot that would carry a pizza across town.
Max Garland of the Memphis Commercial-Appeal reported that small package volume should double:
FedEx said Thursday that the move will help “further serve the fast-growing e-commerce market.”
“Expanding our operations to include Sunday residential deliveries further increases our ability to meet the demands of e-commerce shippers and online shoppers,” said FedEx President and COO Raj Subramaniam in a statement.
FedEx expects the average U.S. daily volume for small packages to double by 2026, he said, fueled by the growth in online shopping. He added that FedEx should continue to gain ground market share as it expands its operations.
FedEx Ground already delivers seven days a week during its peak season, around holiday shopping time. Thanks in part to that temporary expansion, which will happen again this year, the company already knows what it takes to maintain its service on Sunday, said Patrick Fitzgerald, senior vice president for integrated marketing and communications at FedEx.
