Holiday shipping is a closely watched affair, with consumers tracking an elaborate dance of shipments from myriad retailers, merchants eyeing on-time arrivals from their logistics partners, and industry pundits observing who the winners are from the volume-busting year-end period.
Despite all of the prep and planning, however, shipping during November and December never seems to be without a few hitches and glitches, thanks to unpredictable weather and demand that continues to move in only one direction.
LateShipment.com compiled its “2018 State of Holiday Shipping in the U.S.” research report to shed light on how the twin titans of FedEx and UPS fared the previous year and are expected to perform this season, drawing on data from 75 million packages it tracked and monitored itself. The company expects UPS to handle roughly 800 million packages as the season runs its course—nearly twice the 425 million shipments it predicts FedEx will fulfill.
This is the first holiday season expected to top $1 trillion in sales, thanks in part to the maximum number of calendar days available, and LateShipment.com data predicts online shopping will grow 18 percent as more customers choose the convenience of e-commerce over the braying bedlam in stores.
However, convenience sometimes comes at a cost, especially when everyone is ordering packages all at once with much the same delivery deadlines. Last year holiday shoppers drove volumes of apparel, subscription box and wine shipments up 120 percent higher than the average month, a trend that LateShipment.com predicts will develop this festive season.
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Overall, the fashion industry suffered the greatest shipment delays—5 percent—of all sectors observed throughout the 2017 holiday, according to the LateShipment.com report. When shipped by UPS, apparel packages clocked a 12 percent holiday delay rate, up from the average 8 percent during non-holiday months. FedEx’s performance was far worse; the average 15.65 percent delay rate for apparel shipments prior to the holiday shipping month climbed to 20.36 percent during the festive season, the company found.
Taking last year’s historical performance into account, LateShipment.com expects the average package delay rate will hover around 8 percent this season, though the hardest-hit areas—including crowded urban centers, regions with difficult terrain, and places affected by inclement weather—could see delay rates reaching 15 percent.
The company expects the biggest cities of New York and Los Angeles to experience the highest volume of slowdowns, in line with these metropoles’ high volume of shipments as well as 2017 trends. UPS bungled shipments to New York, Chicago, Los Angeles and Houston, where delay rates came in at around 11 percent. FedEx performed marginally better, posting delay rates of just under 9 percent for New York and close to 10 percent for Seattle in 2017.
Retailers might offer premium shipping options to give customers greater assurance that packages will arrive in time, but the higher delivery cost doesn’t necessarily guarantee performance, the report said. Packages sent via UPS Next Day Air were delayed 15 percent more during the holidays than in the month leading up to the festive season, and UPS Standard shipments were tardy 19 percent more than typical. FedEx Home Delivery packages were delayed at a 5.6 percent rate, the report found.