FedEx SmartPost is an arrangement with the USPS where USPS does the last-mile delivery to the customer’s residence.
MEMPHIS, Tenn-FedEx Corp. (NYSE: FDX) expects to move more than 17 million shipments – almost double its daily average volume – through its global networks on December 12, the projected busiest day in company history. The 10 percent year-over-year increase will be driven by FedEx SmartPost, a residential shipping service designed for online and catalog retailers, as well as expected increased volume at FedEx Ground and FedEx Home Delivery.
Between Thanksgiving and Christmas, FedEx forecasts more than 260 million shipments to move through its worldwide shipping networks. This is a 12 percent increase for the holiday season over last year when 232 million shipments were processed.
“As e-commerce continues to grow and demand increases with more customers shopping and conducting their business online, FedEx SmartPost is poised to handle the increase in shipments,” said Frederick W. Smith, chairman, president and CEO of FedEx Corp. “More than 290,000 FedEx team members also stand ready to deliver the holidays and enable commerce around the globe.”
Retail inventory such as apparel, personal consumer electronics and luxury goods as well as books and other items from large, internet retailers will account for a large portion of FedEx holiday volumes.
FedEx will increase its workforce by approximately 20,000 with seasonal positions to help handle the surge in holiday shipments at FedEx Ground, FedEx Home Delivery and FedEx SmartPost.
The impact of the expected higher volumes was included in the company’s earnings guidance issued in September.
The Holiday Retail Outlook
Holiday sales are expected to grow 2.8 percent during November and December to $465.6 billion, according to the National Retail Federation (NRF). This is higher than the average increase of 2.6 percent over the last ten years.
The NRF also reports that nearly half of shoppers (46.7%) will buy online as compared to 43.9% in 2010. According to eMarketer, holiday online shopping will increase by 12 percent during the 2011 season.
Poised for E-commerce . . . FedEx SmartPost
The FedEx SmartPost network is designed for online retailers and cataloguers who ship high volumes of low-weight shipments to residential customers. FedEx SmartPost has an integrated national network that picks up, sorts and delivers packages directly to U.S. Postal Service facilities for final delivery to residences.
The service continues to experience significant growth. As reported in first quarter earnings ended August 31, FedEx SmartPost average daily volume increased 29 percent due to growth in e-commerce and gains in market share.
FedEx Volumes Over the Years
The busiest day of the year at FedEx has continued to grow in volumes over the years. A history of busiest days since 2005 follows:
Dec. 12, 2005 – 9.8 million shipments
Dec. 18, 2006 – 10.6 million shipments
Dec. 17, 2007 – 11.5 million shipments
Dec. 15, 2008 – 12.0 million shipments
Dec. 14, 2009 – 14.2 million shipments
Dec. 13, 2010 – 15.6 million shipments