UPS Expands Customized Delivery Options

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Yesterday, United Parcel Service sent an e-mail to all UPS MyChoice members that announced an additional customized delivery option available to members of UPS MyChoice services.   The upgrade allows recipients to shift parcels sent by the shipper using UPS Surepost or UPS Basic from delivery by a U.S. Postal Service carrier to delivery by United Parcel Service driver.   UPS MyChoice customers can choose to upgrade an individual UPS Surepost or UPS Basic shipment or choose to have all UPS Surepost and UPS Shipments sent to them.   UPS charges $3.50 for each shipment upgraded.  The e-mail which is included below illustrates how the new service will work. The following chart shows [...] Read more »

USPS Delivered a Record Share of FedEx Ground Shipments

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Between December 2012 and February 2013, the U.S. Postal Service delivered a record 35.6% of all FedEx Ground shipments.  The Postal Service delivery was provided as part of the FedEx SmartPost product which experienced a 26.4% growth in shipping volume during FedEx’s 3rd fiscal quarter that ran between December, 2012 and February, 2013. The following chart illustrates the growth in Postal Service delivered shipments as a share of FedEx Ground shipments.     The Postal Service share of FedEx Ground deliveries has steadily grown over the past five years.   The Postal Service’s share of FedEx Ground deliveries in the 3rd quarter of FedEx’s 2013 fiscal year represents a 9.6% increase [...] Read more »

FedEx Growth Continues to Rely on USPS

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In its 1st quarter 2013 earnings report FedEx reported that it handled over 108 million FedEx SmartPost parcels delivered by the Postal Service.  FedEx SmartPost volume grew by 17.6% on a year-to-year basis as compared to a 4.7% growth for shipments that FedEx delivers through its FedEx Ground and FedEx Home networks. Currently FedEx SmartPost generates 29.9% of the shipment volume tendered to FedEx Ground.  The USPS share of  FedEx Ground’s deliveries has increased by 2.4% over the past year and 6.3 since 2010. FedEx SmartPost’s double digit growth rate suggests that the market for USPS delivered parcels is extremely strong.   During this quarter, United Parcel Service was in at [...] Read more »

United Parcel Service Earnings Report Has Good News for the USPS

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United Parcel Service reported earnings press release today provides hints of a changing parcel delivery marketplace that favors the parcel delivery services that the Postal Service does best. Volume grew across all products as ground rose 3%, UPS Next Day Air® increased 5% and deferred air climbed 8.6%. The majority of the improvement was driven by large e-commerce customers shipping low-weight residential packages. The shift to residential deliveries has resulted in UPS’s revenue per piece rising far less than its change in rates from a yar ago.  UPS states that the change is due to a customer and product mix.  The change in customer mix describes the growing proportion of UPS”s [...] Read more »

Amazon Goes Head to Head with USPS with Parcel Lockers in Virginia

Amazon Locker in 7-Eleven

Amazon has now introduced parcel lockers to a third metropolitan area in the United States by installing seven parcel lockers in seven 7-Eleven’s in Northern Virginia. By installing parcel lockers in the same general geographic area as the Postal Service, Amazon clearly indicates that its parcel locker delivery system is a direct competitor with delivery by the U.S. Postal Service, United Parcel Service and FedEx. While Amazon’s parcel lockers are in the same general geographic area, Amazon has made some real estate and operating/software decisions that may provide Amazon with a competitive advantage among customers that find locker delivery attractive Amazon’s Lockers are in More Up-market Zip codes than Gopost Amazon [...] Read more »

USPS Delivered 30% of FedEx Ground Shipments in FedEx’s Fiscal Fourth Quarter

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For the twelfth consecutive quarter  FedEx has increased the proportion of shipments handled by its FedEx Ground subsidiary over the same quarter the previous year.    The continued rapid growth of FedEx Ground’s SmartPost service reflects the continuing increase in business-to-consumer shipments that FedEx transports for its customers. The following chart illustrates the share of FedEx Ground shipments delivered by the Postal Service since 2009.  The increase in USPS share of deliveries reflects the faster market growth of FexEx SmartPost as compared to FedEx Ground’s delivery using other FedEx Ground or FedEx Home contractors.  The fast growth rate of Fedex SmartPost reflects the need of B-2-C online retailers for a low cost delivery service [...] Read more »

Postal Service Delivers a Record share of FedEx Ground Shipments

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In its most third quarter, 2012, FedEx, through its FedEx SmartPost Operations delivered 32% of all shipments handled by its FedEx Ground Division.  The FedEx Ground Division includes FedEx Ground, FedEx Home, and FedEx SmartPost. During the quarter FedEx Ground had the Postal Service deliver 123 million parcels, an increase of 12.9% over the number of FedEx shipments that the Postal Service delivered a year ago.  On a daily basis this means that between FedEx dropping nearly 2 million parcels a day into the Postal Service’s delivery network. The Growth of FedEx SmartPost Volume is less than the growth in volume that Postal Service handled from all carriers that use it [...] Read more »

FedEx Earnings and SmartPost and Parcel Select

FedEx announced its earnings today.   The Associated Press reported that earnings were ahead of analyst expectations.   FedEx is forecasting strong earnings growth in its First Quarter, 2012 (which starts June 1, 2011) and all of its FY 2012  FedEx Ground delivery volume grew 6% in the quarter which is stronger than total industry growth.  This growth was paced by FedEx SmartPost where “average daily volume increased 24% due to growth in e-commerce and gains in market share. FedEx SmartPost revenue per package increased 8% primarily due to growth in higher-yielding services and increased fuel surcharges.” Since 2008, FedEx SmartPost has grown from 4.9% of FedEx Ground Revenue to 7.4% of [...] Read more »

Postal Service Prices Last Mile Aggressively in 2011

The Postal Service has just released its 2011 rates for Express Mail, Priority Mail and Unregulated Parcels.   Going through the entire proposal will take some time.   However, a quick review of Parcel Select rates indicates that the Postal Service has not chosen to follow the rate increases of United Parcel Service and FedEx in its pricing of the last mile.   Instead, its pricing for 2011 suggests an aggressive effort to gain market share over the last mile while focusing on ensuring that delivering parcels under 1 pound are profitable.  The Postal Service’s rate increases for Priority Mail also suggest an aggressive effort to gain market share on end to end [...] Read more »

The Exigent Rate Case: Rethinking Price Regulation

Yesterday the Postal Service proposed a major change in its rate structure through an exigent rate case.   The general and postal press have focused on 1) the rate increases themselves with particular attention to the impact on First Class single piece mail; and 2) the exigent process itself, a rate setting process that is being used for the first time.  Mailers have organized a major effort to stop the changes through a new group the Affordable Mail Alliance.   With only 90 days to press their case mailers have a major challenge in their effort to argue that: the conditions necessary for invoking the exigent process had not been met;  the [...] Read more »