A look around the internet during the holiday season showed that it indeed wasn’t a holiday for shipping. There were stories of late and missing packages, unhappy customers, and shippers with lost revenue. But, despite the doom and gloom –and some real difficulties—carriers did an admirable job delivering parcels during an unprecedented carrier capacity crunch.
Despite encouraging shoppers to shop early, and in turn, retailers being able to ship earlier, there were still some issues with getting packages to front porches across the country due to peak surcharges and volume caps placed on some shippers by FedEx and UPS.
A CBS News story released on Christmas Eve reported that throughout the holidays “an estimated 6 million packages a day were being left behind by FedEx, UPS, Amazon, the U.S. Postal Service, and other shippers. Another 3.5 million packages a day that were picked up were not reaching their destinations on time.”
However, despite those setbacks, the major carriers had solid delivery numbers, particularly given the double-peak shipping combination of the holidays and the ongoing COVID-19 pandemic.
Better than expected holiday delivery record for major carriers
According to the numbers that are out, the major carriers’ deliveries were on par with the year before. During the holiday season, a whopping billion parcels were delivered, according to ShipMatrix.
Furthermore, the report showed that FedEx, UPS, and the U.S. Postal Service posted on-time delivery percentages in the 90s for the five weeks between Black Friday and December 26.
During that time, FedEx posted a 95.1 percent on-time rate. Simultaneously, UPS had a 96.7 percent on-time status, and USPS delivered packages on time 93.2 percent of the time. These numbers match up well with the 2019 peak period. Astonishingly, FedEx topped its 2019 on-time rate of 94.6 percent, UPS edged its 96.6 percent rate. USPS did dip a bit, but it was only a slight drop from 93.9 percent in 2019.
Holiday shipping season shows there is still room for improvement
Despite the good news, millions of parcels still did not get delivered by Christmas, according to ShipMatrix. “While this performance for all three was better than the prior week, handling such a huge spike in volume with temporary methods — that includes deliveries made on Christmas Day — still resulted in over 2 million parcels not delivered by Christmas,” the company said in the release.
Late orders may add to holiday returns
However, just because the holidays have passed, shippers are not out of the woods as carrier volume isn’t expected to drop anytime soon. Especially as holiday returns are exacerbated by late-arriving packages added to the expected returns for damages, incorrect sizes, etc. This only adds to retailers’ costs in lost sales and extra ancillary fees from carriers.
According to a CNBC article, UPS expected to move 1 million returned packages a day during the holiday season, with a peak of nearly 2 million on January 2. Factoring in other carrier shipments, the expected total value of returned online orders may reach $41.6 billion.
Last year was a difficult one for shippers and carriers. 2021 looks to be off to a rocky start as well. However, a solid strategy includes using a multi-carrier parcel management solution like Transtream, which helps reduce costs such as dimensional weight fees with AI-powered cartonization technology. It also manages the returns process and allows shippers to utilize an expansive multi-carrier network, helping retailers retain more of their profits and gain a competitive advantage.
Schedule your demonstration and learn more about Transtream multi-carrier management solution.