USPS expecting record holiday season shipping volumes

Like the duopoly of UPS and FedEx, the United States Postal Service (USPS) is calling for a very active holiday shipping season, expecting 385 million packages to be shipped, which represents a 20 percent annual gain and would be a USPS record.

As was the case with recent announcements by UPS and FedEx, the USPS expects the surge in holiday shipping volumes to be largely driven by e-commerce, with about 18 million cards, letters, and packages expected to be delivered between Thanksgiving and New Year’s Day.

And in terms of its busiest days during the holiday season, the USPS said that the busiest mailing day for holiday cards/packages is Monday, Dec. 17, when more than 655 million pieces of mail are expected to be processed—compared to 538 on an average day. The busiest delivery day for letters, said the USPS, will be Wednesday, Dec. 19 and the busiest day for packages will be Thursday, Dec. 20. 

Shipping is a real bright spot at the Postal Service right now, and there’s no question that it’s going to play a pivotal role in the future financial health of post office, said Doug Caldwell, VP, EMEA, at AFMS.  

“Somewhat surprisingly, the Postal Service is now the fastest growing U.S. carrier in terms of volume,” he said. “With our sluggish economy, nearly all of the new volume is B2C, and that’s where USPS is showing tremendous growth in spite of the economy.  One of the key ingredients to that success is the much improved shipment tracking, which has shown significant improvements over the last 24 months, due in no small part to Jim Cochrane, who heads up the visibility team over there. The Postal Service is also rolling out their new Metro Mail same day delivery service in time for the holidays, which is set to go live in San Francisco next Monday.”

This announcement comes at a time when the USPS still has a host of financial issues.
During the fiscal third quarter, the USPS incurred a net loss of $5.2 billion, compared to a $3.1 billion net loss for the same quarter in 2011. Factoring largely in the loss was $3.1 billion for the legislatively mandated prefunding of retiree health benefits, coupled with the continued decline of First-Class Mail volume, which it said more than offset the quarter’s 9 percent growth in revenue from Shipping Services and package delivery.
USPS Shipping Services and package revenue totaled $3.3 billion in the third quarter, a 9 percent increase, on a volume increase of 43 million pieces, or 5.2 percent, the USPS said.

UPS and FedEx volumes: UPS said last month that it expects to deliver 527 million packages between Thanksgiving and Christmas this year, which would top last year’s record 480 million. And it said that its busiest day of the year is expected to be Thursday, December 20, a day that UPS said it will deliver an estimated 28 million packages globally.

To put that number into better perspective, UPS said it is the equivalent of more than 300 packages being delivered per every second of that day, whereas on an average day, it delivers 15.8 million packages.

As for FedEx, the company said that it expects Monday, December 10 to be the busiest day in the company’s history, expecting to move a projected 19 million shipments through its global ground, express, and freight networks, which would represent a ten percent annual increase.

Like its chief competitor, FedEx is pointing to e-commerce as the engine that will drive the FedEx Ground and FedEx SmartPost networks on “Green Monday,” the second Monday of December and one of the most lucrative days of the year for retailers.