Shipping Companies Could Refuse Packages This Holiday Season

Shipping companies could refuse packages

A slowly recovering economy and intense competition could prompt business to ramp up their sales promotions this holiday season. While this has the potential to increase spending by consumers tempted by irresistible deals, some might find that getting items delivered to their homes may have to wait until after the holiday rush.

FedEx and UPS both announced plans this year to work with major businesses to ensure a smooth, timely delivery flow. Last minute sales, however, could add unanticipated pressure to shipper delivery networks. This might have the potential to adversely impact operations and reduce delivery fluidity. If such a situation occurs, it could become necessary for the two shippers to increase the cost of their package services, and perhaps even prompt them to refuse the business if it threatens to overwhelm the network.

If their delivery networks suffer a repeat performance of last year’s delays, both shipping companies may find themselves with the tough decision of introducing higher shipping charges specifically for the holidays in 2015. This could cause online shoppers to abandon their shopping carts at checkout when faced with higher than expected shipping charges, and might even result in an unexpected revenue decline for businesses during their most profitable time of the year.

As the holiday season progresses, only time will tell if advanced preparation by UPS and FedEx is sufficient to handle actual volumes this year.

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The Easy Way to Send Holiday Gifts This Season

PM winter 1

Shopping for the best deals this holiday season is hard – shipping them to friends and family doesn’t have to be.

The Postal Service has free Priority Mail packaging and free package pickup to ease the hustle and bustle of the holiday season. Go to usps.com, order free Priority Mail packaging supplies delivered directly to your home, print shipping labels from your computer, and schedule a friendly carrier to pick up those special items.

Sending gifts to friends and loved ones for the holidays has never been easier thanks to Priority Mail from the Postal Service, now with special winter-infused designs just for the holidays. Be sure to drop by USPS.com and see what other delightful goodies are awaiting your discovery!

Savings for the Holidays

 

Holiday Priority Mail boxes

If you’re into great savings this shopping day, don’t forget about the great deals on usps.com.

The Postal Service has a top notch lineup of easy to use shipping products this holiday season with online discounts, free packaging delivered directly to your home and free package pickup.

So after the day is done and you’re finished checking out the great deals this busy day, head over to usps.com when you’re ready to send those special items to friends and family. You’ll not only enjoy the festive designs of a streamlined website, the extra money you’ll save on shipping will be enough to put a little extra jingle in your pockets this holiday season.

Set It and Forget it Purchasing

Set it and forget it purchasing

Consumer demand for the convenience of online purchases and home delivery is increasing every year. To service this demand, many brick and mortar stores have adapted their operation to offer more product availability, shipping options, and discounts online. As they do, customers have more incentive to continue doing business with those organizations that better suit the needs of a busy lifestyle. To that end, Target began offering online discounts through a specific service last year that caters to on-the-go parents. Recently, the company announced an expansion of that service to accommodate a more diverse audience.

In mid-April, Target revealed a more diverse product offering with its online Subscription service. The service allows participants to select everyday household items such as paper towels, laundry detergent, and printer ink for regular delivery at specific intervals. Customers can choose among thousands of items for delivery schedules that they set and in quantities they select. The service comes with free shipping on returns for an unwanted product or a customer can choose to return the item to a local store. Individuals receive a 5 percent discount on items through the service and another 5 percent if they use their store card to purchase them.

Target ships through a variety of carriers, including the Postal Service. The availability of affordable, efficient shipping services is crucial to maintain profitability at online stores, particularly when free shipping and Internet-based discounts are offered by an e-tailer.

Like the Subscription service offered at Target, many new online service innovations will be created in the coming years to attract customer into their digital showrooms. Finding the right shipping partner could be the key difference between a successful venture and an expensive flop.

Do you think the Postal Service is poised to be the carrier of choice for tomorrow’s Internet shopping solutions?

Prime Increase

Prime increase1

There are many online stores around the world that offer a variety of shipping deals to entice shoppers into spend more at their website. Deals range from offering a low, fixed price to free ground-based shipping for orders over a certain dollar figure. One particular shipping deal has been a success at a certain e-tailer for many years, but will a recent price increase curb its customer’s interest?

Prime, offered by Amazon.com, is a service that, among other benefits, offers customers the opportunity to receive two-day shipping on their purchases for a single annual subscription fee.  There is no minimum order amount, and while Prime shipping is available for millions of items, it doesn’t include everything on its website. Recently, the company announced that the price for Prime membership will increase from $79 to $99 per year. Will the 25 percent increase cause subscribers to cancel their membership?

Customers who shop frequently at Amazon are likely to save more money with Prime than they would spend on the equivalent shipping option without Prime. A casual shopper purchasing items only a handful of times or less per year could save more by paying directly for two-day shipping than purchasing a Prime membership, absent other membership considerations. If an individual purchased one item per month at a two-day shipping rate of $14.48 for example, the annual cost of the purchase would amount to $173.76, a modest increase of $74.76 greater than the cost of a Prime membership. Purchases exceeding one per month could magnify the savings of Prime membership even further. With such a significant savings potential for higher volume shoppers, will offering discount shipping options hurt Amazon’s bottom line?

In fiscal year 2012, Amazon realized a $2.85 billion loss on outbound shipping activity. In fiscal year 2013, that loss increased to $3.53 billion. While its losses on shipping costs have increased over the past two years, Amazon is continuing to expand its efforts to reduce such costs.

In its 2013 annual report, Amazon states: “We seek to mitigate costs of shipping over time in part through achieving higher sales volumes, optimizing placement of fulfillment centers, negotiating better terms with our suppliers, and achieving better operating efficiencies. We believe that offering low prices to our customers is fundamental to our future success, and one way we offer lower prices is through shipping offers.”

Though the Prime membership price increase may not be entirely welcome news to customers, most participants in the program are unlikely to withdraw their subscription if they intend to continue shopping at Amazon, particularly with the recent service enhancement of Sunday delivery through the U.S. Postal Service.

Do you think Amazon could reach a break-even point in outbound shipping activity more rapidly by making the U.S. Postal Service its exclusive shipping partner?

Cyber Monday

Cyber Monday 2013

Are you worn out from all the holiday shopping this past weekend? Would you like to send those holiday packages to friends and family without leaving home?

The Postal Service has free Priority Mail packaging and free package pickup to ease the hustle and bustle of the holiday season. Simply go to USPS.com, order free Priority Mail packaging supplies delivered directly to your home, print shipping labels from your computer, and schedule a friendly carrier to pick up those special items.

Sending gifts to friends and loved ones for the holidays has never been easier thanks to Priority Mail from the Postal Service. Be sure to drop by USPS.com and see what other delightful goodies are awaiting your discovery!

Black Friday Discounts

Black friday discounts 2013

Are you on the hunt for great black Friday markdowns today? Be sure to add USPS.com to your list for great online shipping discounts. While there, you’ll not only enjoy reduces prices on shipping, you can also print package labels and schedule free package pickup from the comfort of your own home.

So after the day is done and you’re finished checking out the great deals this busy day, head over to USPS.com when you’re ready to send those special items to friends and family. You’ll not only enjoy the festive designs of a streamlined website, the extra money you’ll save on shipping will be enough to put a little extra jingle in your pockets this holiday season.

Online Purchases a Winter Wonderland for Shippers

With December just around the corner, early shoppers have already begun looking for great sales, hard-to-find items, and decorative holiday gear to get ready for the big day. Taking to streets to battle crowded stores is becoming less of an issue these days as more people search for items on their shopping list online.

Modern technology, such as smart phones and tablet PCs, have made the process of gift-buying easier and more accessible than ever. It’s expected that online shoppers will spend nearly $55 billion on purchases made on their Internet-accessible devices this season. That’s almost a quarter of all sales in the United States during the holiday crunch time, and close to $8 billion more than the same period last year.

The Postal Service expects to ship 15.2 billion cards, letters and packages between Thanksgiving and Christmas Eve. A good portion of that volume consists of Internet purchases. With a sustained climb in Internet sales predicted for the foreseeable future, the resulting increase in demand for package delivery services will continue to be a great growth opportunity for shippers. That increase in demand will entice new competitors to enter the market and stake a claim for their own share of the lucrative business.

We’ve already seen companies such as Amazon.com, Wal-Mart, and eBay looking to take advantage of this trend by starting their own package services. It may not be long before other companies seek to enter this growing industry as well.

What other businesses to you think will attempt to enter the shipping industry?

  • Hello, I'm Benny the Blogger: I'm the world's most famous postal employee. My hobbies are snappy quotes, kite flying and publishing. I was born Jan. 17, 1706, but don't call me old.

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