Parcel Carriers See Increased Business From Web-Based Holiday Season Shopping

For parcel carriers, the reported surge of online shopping has been a boon for their businesses, companies said.

UPS Inc., Atlanta, announced that it expected to ship 120 million packages the week before Dec. 25 and planned to hire more than 55,000 seasonal employees.

The increase in online shopping has “had a considerable impact on our business,” said Mark Dickens, a spokesman for UPS, which ranks No. 1 on the Transport Topics Top 100 list of the largest U.S. and Canadian for-hire carriers. “Today, more consumers are doing their shopping online than ever before. As a result, the percentage of our delivery volume going to residential addresses has gone from 10% 15 years ago to 35% today.”

“By and large,” Dickens said, “the shift to more residential deliveries doesn’t change the type of equipment we use, personnel numbers or operational methods, although we’re always fine-tuning everything to ensure we’re doing things in the most efficient way possible.”

Purolator Courier Ltd., in Mississauga, Ontario, also is finding an increase in direct consumer shipments as a result of increased online shopping, said Ramsey Mansour, vice president of marketing.

Direct consumer shipping is somewhat different from traditional manufacturer-to-retailer shipping, Mansour said. “That’s more predictable, more ongoing.” With direct consumer shipments, “it’s more transactional. It doesn’t follow a consistent process. It’s more customized.”

It’s become more customized because, as consumers have be-come more accustomed to online shopping, their expectations have increased.

They want “a more positive customer experience, a more efficient customer experience,” Mansour said. That means “providing customers with real-time tracking information” using technology such as mobile platforms and online tracking.

Meeting expectations also re-quires flexibility on the part of the package-delivery carrier, said Karen White, Purolator’s director of communications. White said the company has developed great flexibility to adjust for peak seasons.

“We can anticipate the flow of demand based on the business-to-business flow,” which peaks ahead of consumer flow, she said.

In addition to its nearly 500 company-owned tractors, Purolator has a strong relationship with owner-operators, White said, “particularly in remote areas, areas where it wouldn’t be feasible to have someone full time.”

To smooth the shipment process to its Canadian customers, Purolator’s international division works with retailers in 20 U.S. cities. The company, No. 19 on the for-hire TT 100, plans to add bureaus in 10 more U.S. cities in 2012.

Canadian package delivery carrier TransForce Inc., Saint-Laurent, Quebec, declined to comment on its experience and plans.

FedEx Corp., Memphis, Tenn., estimated that between Thanksgiving and Christmas, it would move more than 260 million shipments worldwide, a 12% increase over the holiday season last year. To help handle the surge in shipments during the holidays, FedEx planned to add nearly 20,000 seasonal positions, the company said in a press release.

FedEx, No. 2 on the fore-hire TT 100, and UPS both have programs that depend on the U.S. Postal Service to go the final mile.

FedEx markets its SmartPost network to online retailers and cataloguers that 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 Postal Service facilities for final delivery to residences.

According to the first-quarter earnings report (Aug. 31) from FedEx, SmartPost average daily volume increased 29% from the growth in e-commerce and gains in market share.

UPS offers SurePost, billed as a low-cost alternative for customers shipping not-urgent and lightweight ground residential products. It is a contract service for shippers (not recipients), combined with the Postal Service for final delivery.

The UPS fleet is made up of 91,136 package cars, vans, tractors and motorcycles, including 2,292 alternative-fuel vehicles. UPS delivers annually to more than 100 million residential addresses.

UPS has launched a new service, UPS My Choice, “to help alleviate some of the frustration of missed delivery attempts to residential addresses, which is a direct result of more people shopping online,” the company said in a September news release.

The service is designed “to increase the likelihood of a successful delivery on the first attempt by providing delivery alerts, specific delivery time frames, reroute options, visibility tools and electronic signature release — all by accessing ups.com through a computer or mobile phone.”