FedEx has announced transformational operational changes aimed at improving the services for the fast-growing e-commerce market. FedEx Ground now delivers seven days per week during the holiday peak season, and beginning in January 2020, this service will continue year-round for the majority of the US population. The company is also making operational changes to enhance last-mile efficiency by integrating FedEx SmartPost volume into standard operations and adding large package capabilities.
“We have made significant investments in capacity, technology and automation at FedEx Ground over the past 20 years. These investments have allowed us to gain ground market share for 19 of the last 20 years, and we are now ideally positioned to extend that growth as the average daily volume for small parcels in the U.S. is expected to double by 2026,” said Raj Subramaniam, president and chief operating officer, FedEx Corp. “Expanding our operations to include Sunday residential deliveries further increases our ability to meet the demands of e-commerce shippers and online shoppers.”
In addition to increasing utilisation of existing assets, FedEx is also enhancing delivery density. Nearly two million FedEx SmartPost packages that were previously given to the U.S. Postal Service for delivery to homes every day will be increasingly integrated into FedEx Ground operations and delivered by the same service providers currently handling FedEx Ground residential packages. Since 2016, approximately 20% of FedEx SmartPost packages have been integrated into the FedEx Ground network to date. The integration of these packages will accelerate this autumn, and the vast majority of FedEx SmartPost package volume is expected to be integrated into FedEx Ground operations for final delivery by the end of 2020.
Subramaniam added, “We anticipate substantial density improvement and efficiency opportunities when all residential packages are sorted and delivered within the same ground network.”
FedEx also announced that it is improving capabilities for large items as online shopping has quickly evolved to include oversized and heavy items such as TVs, furniture, rugs, mattresses and auto parts. Large packages now comprise more than 10% of FedEx Ground’s volume, and the growth is expected to continue. The company is making operational changes to support the handling of these large items. These changes include designing new facilities, adding equipment to existing facilities and other adjustments.
Subramaniam commented, “Each one [transformational step] advances the company’s commitment to continued superior service and increased efficiency in handling all e-commerce packages – small and large – within one ground network, seven days a week, year-round.”
Source: FedEx
