Holiday season on-time performance is solid for carriers, with some challenges, too

Data issued this week by two separate organizations for on-time performance of holiday shipments for week 49 and week 50 of 2019 showed that carriers are dealing with seasonal challenges and spikes, while on-time performance remained solid over all.

ShipMatrix, a subsidiary of Pittsburgh-based SJ Consulting, reported that carriers made some improvement, in week 50, while also continuing to deal with challenges related to what it described as “huge spikes in volume due to [a] shorter peak season and more aggressive deployment of omnichannel by brick and mortar retailers in 2019.”

Looking at first mile, middle mile and last mile movement for combined express, deferred and ground services, for week 50, ShipMatrix reported that on-time delivery for UPS was 95.8%, FedEx was 90.6%, and the United States Postal Service (USPS) was 93%. The firm also said its data pointed to an increased number of parcels being delivered on Saturdays and Sundays, which it said will help these carriers ensure that all delayed parcels in their respective networks are delivered well in advance of Christmas Eve.

ShipMatrix also observed that with Amazon Logistics now handling millions of Amazon online orders through its own delivery network with contracted drivers, mainly for local and short distances, are seeing fewer delays. And it noted that week 50 last mile performance, for week 50, was solid, with Amazon Logistics at 98.9%, FedEx Ground at 99.5%, UPS at 99.7%, and USPS Parcel Select at 98.7%.

Shipping Data for Week 49

Data from San Diego-based parcel consultancy Shipware LLC, for week 49 of 2019, showed that on-time performance for UPS and FedEx saw significant declines, with FedEx at 91% and UPS at 87.5%. Both carriers were above 95% for week 48. Keith Myers, Shipware senior consultant, wrote in a research note that this sequential decline was not unexpected, as week 49 included Black Friday and Cyber Monday online orders.

What’s more, Myers cited reports indicating that Black Friday and Cyber Monday shoppers spent 20% more compared to the same period a year ago, with a Shipware partner telling the firm that the majority of its e-commerce and retail customers having “significantly underestimated” peak season demand.

Harsh winter weather conditions also factored into on-time performance, too, with Shipware noting that FedEx and UPS referenced weather-related delays in Colorado, Utah, New England, and the Upper Midwest, while their respective hubs, in Memphis (FedEx) and Louisville (UPS) were not severely impacted.

Looking ahead, Shipware’s Myers said that shippers should plan for a similar degradation in on-time performance, with the final shipping days of the shortened holiday season here.

“Retailers should consider recommending or subsidizing expedited services to ensure delivery by Christmas even if ground transit times are stated by the carriers as acceptable,” stated Myers. “Adding transparent communication to online checkout pages about the risks of delays due to a nationwide surge in shipments can encourage upgrades to expedited shipping methods and otherwise help prevent some frustrations on late deliveries.”

Editor's Note—UPS provided LM with the following statement, regarding holiday season service:

“Last week UPS added resources and extended work schedules and we have successfully addressed delays in selected areas where weather and record volume created lower than normal service levels during the early part of the week.  This week the UPS network is running at our normal high on-time service levels with no delays. UPS is capable of accommodating our customers’ shipping needs so they can take full advantage of the entire holiday season, from pre-Christmas deliveries to a forecast record level of holiday returns.  UPS is proud to also support our non-retail customers as they close the year focused on meeting their business objectives.”