New data from Convey Inc. shows how COVID-19 continues to impact retail and last mile delivery, but also that on-time performance in March returned to pre-COVID levels for the first time since the pandemic began.
The data set, which includes performance and market share for FedEx, UPS, USPS and regional carriers, was derived from tens of millions of packages shipped from more than 500,000 locations in North America in March.
Convey’s report shows that across all carriers, 82 percent of parcel shipments were delivered on time last month compared to 85 percent in March 2020. FedEx performed significantly lower than other carriers–75 percent on-time performance compared to 86 percent for UPS and 90 percent for USPS, with its least-expensive service levels hit hardest, according to Convey.
Market share stabilized with FedEx and UPS dominant, Covey said. So far in 2021, UPS and DHL have held steady in Convey network market share. FedEx has steadily gained at the expense of the USPS, which has seen a gradual decline in market share since the peak season in December. March 2021 market share for the carriers was led by FedEx (38 percent), followed by UPS (26 percent), USPS (9 percent), DHL (11 percent) and regional carriers (16 percent).
On-time performance (OTP) suffered as FedEx SmartPost moved away from USPS and rebranded to FedEx Economy, according to Convey–in March, FedEx announced that its SmartPost business was being rebranded as FedEx Economy and that last mile delivery operations formerly handled by the USPS had been fully integrated into the Ground network. More than a rebrand, the move marked a shift in strategy aimed at making the service more profitable and more competitive in transit by moving to 7 days a week delivery.
Convey analyzed nearly 14 million SmartPost/Economy shipments from January 2020 through March 2021 to quantify the transition and understand its impact on transit time and on-time percentages. The data showed a precipitous drop in USPS handoffs after May 2020, where 69 percent of SmartPost shipments were delivered by USPS in the final mile versus 3 percent delivered by USPS in March 2021. This means FedEx is moving 97 percent of Economy shipments fully within its own Ground network.
However, FedEx’s OTP for SmartPost/Economy dropped to 66 percent compared to 86 percent in March 2020. Convey’s data showed that FedEx is promising faster estimated delivery dates that aren’t being met.
Convey’s Delivery Experience Management platform combines real-time visibility, post-purchase experiences, and advanced insights and analytics to create a solution uniquely capable of perfecting last mile delivery. Supply chain and customer experience leaders including Neiman Marcus, Jet.com, and Eddie Bauer rely on Convey’s software and expertise to take action to ensure shoppers get their orders how and when they want. Founded in 2013, Convey is backed by Silverton Partners, Techstars Venture Group and RPM Ventures and based in Austin, Texas.