The holidays are finally over. The cookies have been eaten, the decorations have been shelved for another year, and all of the gifts have been opened.
Better yet, the vast majority of packages arrived on time. FedEx, UPS, and USPS all improved their on-time performance during the 2018 holiday season compared to the same in 2017.
Shippers should note that what is considered an “on-time” delivery changes during the holidays. During the rest of the year, third-party parcel carriers may promise businesses that they’ll deliver parcels at a specific time — and if they fail, their clients can claim refunds for those deliveries.
But during the holidays, some carriers insert blackout delivery dates, when shippers cannot collect refunds. FedEx and UPS also sometimes extend their late-transit time window by 90 minutes, or even to the end of the day. That’s on top of peak season surcharges, of course.
When carriers say they delivered more than 98 percent of parcels on time during the holiday season, that doesn’t mean the same thing as it would the rest of the year. Packages that arrive 60 minutes after scheduled delivery might be considered late in October but not in December.
And even with those tweaks, on-time performance typically slips during the holiday season. In 2017, on-time delivery performance for the U.S.’s major carriers fell four percent between Thanksgiving and Christmas.
But in 2018, the U.S.’s two major private carriers and the U.S. Postal Service all reported that they delivered more than 97 percent of their holiday parcels on time.
All data is for combined services and is reported by companies themselves, not an independent arbiter.
FedEx: 97.6 percent of packages arrived on time
In 2018, FedEx topped its 2017 on-time performance just slightly. Last year, 97.4 percent of parcels arrived on time. This year, that crept up to 97.6 percent of deliveries.
FedEx has not yet announced how many parcels it delivered in 2018, but last year, projected 400 million packages.
Raj Subramaniam, FedEx CEO, called 2018 “another record-breaking year” with “record-breaking service levels.”
“We are extremely proud of the excellent service levels that we achieved this peak season, especially given the increase in volumes,” Subramaniam said in January.
UPS: 98.3 percent of packages arrived on time
UPS made much bigger gains in its on-time service performance. In 2017, the carrier made 95.3 percent of its deliveries on time. In 2018, that jumped to 98.3 percent.
That might seem like a small difference. But when we’re talking about hundreds of millions of parcels, a difference of 3 percent means millions of packages arrived on time rather than late. UPS has not yet released figures for how many packages it delivered during the holiday season, but earlier in the year, it predicted that it would ship 800 million parcels between Thanksgiving and Christmas.
UPS made some important structural changes this year to secure that success. The company has made some important automation advances. It also made a point to hire seasonal workers early, staffing up for the busy season.
USPS: 98.8 percent of packages arrived on time
We only have data for USPS Parcel Select, which is the U.S. Postal Service’s ground delivery service for bulk packages. In 2017, USPS delivered 98.2 percent of those parcels on time; in 2018, that climbed to 98.8 percent of parcels.
USPS is a shipping solution for many thousands of small businesses. It’s also essential to Amazon and its third-party sellers. When Amazon expands its free shipping offerings — as it did during this holiday season — USPS often ends up bearing that load. Amazon broke its holiday sales record this year, with Prime customers alone ordering more than one billion packages. Amazon also sold Christmas trees up to seven feet in length and sold out well ahead of the holiday.
Moving on from the holiday season
In January, many businesses see retail sales slip as customers take post-holiday shopping breaks. That makes it the perfect time to review November and December and evaluate what might need to change.
If you can, find time during the first quarter to review your invoices from the holiday season. See how your carrier’s on-time performance compared to the performance they reported nationally. Also, make sure you look at how much of your shipping spend was eaten up by surcharges and keep an eye out for any refunds you can claim.
Ideally, your supply chain management team would do this with every invoice. These documents are full of valuable information and potential savings, in the forms of information for your next contract negotiation and refunds your carrier owes you right away. But most supply chain teams are already stretched thin.
At Reveel, we know that — and that’s why we’re here. Our expert shipping audit specialists can perform 45-point parcel audits on every single one of your shipments. Our proprietary software automates this process so you know exactly how much you’re owed. This process alone can reduce your shipping spend by five percent. To find out what Reveel can do for you, claim your free invoice audit today.