FedEx (NYSE: FDX) predicts that Monday will be the busiest day of its 2021 holiday season. The company continues to deal with operational setbacks amid labor shortages, increased volume, and the ongoing pandemic, according to Tammy DeGroff, FedEx spokeswoman.
“We’ve seen a lot of people actually starting their Christmas shopping in the month of October, which is fundamentally different than we have seen traditionally in the past,” Ryan Kelly, vice president of global e-commerce at FedEx told CNBC. “What you see is a lot of messaging about shop and ship early, pulling sales forward, pulling promotions forward. A lot of retailers have really leaned into that this year.”
The American multinational conglomerate holding company delivered about 96% of its packages on time in October, compared to UPS that delivered 99% of its packages on time and the 99% of the U.S. Postal Service, according to data from ShipMatrix. Deliveries made on time above a 95% efficiency, are considered an indication of an effective network.
FedEx anticipates delivering 100 million more packages in 2021 than it had from Black Friday to Christmas in 2019, as well as 10% more than in 2020.
According to Kelly, the “ship from store” method used by big-name retailers like Target and Walmart has decreased the strain on shipping networks. “Some of the best retailers out there are really leaning into their retail stores. They have deployed inventory in those stores, it improves transit and lowers cost if a retailer leverages that localized inventory.”
The CEO of ShipMatrix, Satish Jindel, told CNBC that “This season looks pretty good compared to last year. The increased number of people shopping in-store, shopping early has reduced the demand” for delivery all at once.