Order Consolidation may help meet Record Holiday Delivery Demand
Even with extended delivery windows, on-time rates fall as record level demand peaks this holiday season
Major Carriers are straining to keep up with holiday shipping volumes that have blown past expectations, delaying the delivery of some of the millions of online orders shoppers have placed since Thanksgiving.
Already in advance of the busy holiday season, both UPS and FedEx have extended delivery windows for some routes, suspending delivery guarantees and refunds for a brief period.
According to an analysis from a source to the WSJ, on-time delivery rates for UPS ground, adjusted for weather and other unavoidable delays, fell to about 96% last week while FedEx Ground’s hit approximately 97%. That was an improvement from about 95% at both companies on the same week in 2015, though on-time delivery rates usually are higher by at least 4% outside the holiday season.
Parcel carriers’ logistics operations are being tested by the surge in web orders at the holidays, which has grown rapidly over the past several years.
This year, e-commerce accounted for more than 25% of consumer spending on Black Friday and the two days prior, up from 18% last year and nearly double the figure for the same period four years ago, according to First Data Corp. UPS in November said it expected to handle a record of more than 700 million packages between Thanksgiving and the end of December this year, up 14% from last year’s all-time high.
Order consolidation is considered by some as an effective response to limited supply during the peak holiday shipping season. Contact us to learn more about how effective order consolidation within your transportation management strategy can help you meet surging holiday order demand.
*Source: WSJ, to view cited reference, please click here.