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UPS and FedEx Ruin Christmas for Late Shoppers

Christmas-Delayed_Packages-Fedex-UPS

UPS and FedEx underestimated their capacity needs and failed to deliver packages in time for Christmas.

WaPo (“Santa’s sleigh delayed after snags at UPS, FedEx“):

Santa’s sleigh didn’t make it in time for Christmas for some this year due to shipping problems at UPS and FedEx.

The delays were blamed on poor weather earlier this week in parts of the country as well as overloaded systems. The holiday shopping period this year was shorter than usual, more buying was done online and Americans’ tendency to wait until the last possible second to shop probably didn’t help either.

Neither company said how many packages were delayed but noted it was a small share of overall holiday shipments. While the bulk of consumers’ holiday spending remains at physical stores, shopping online is increasingly popular and outstripping spending growth in stores at the mall.

[...]

Godwin said snow and ice in the Midwest last week and an ice storm that hit Dallas two-and-a-half weeks ago were partially to blame. She also said the volume of packages shipped exceeded the capacity of UPS but would not share the number of packages shipped or what the company’s maximum capacity is.

UPS did not make pickups or deliveries Wednesday. Extra workers were being brought in Wednesday night to the company’s hub in Louisville, Ky., to sort packages for Thursday and Friday delivery, according to Godwin.

WSJ (“Late Surge in Web Buying Blindsides UPS, Retailers“):

A surge in online shopping this holiday season left stores breaking promises to deliver packages by Christmas, suggesting that retailers and shipping companies still haven’t fully figured out consumers’ buying patterns in the Internet era.

Companies from Amazon.com Inc. AMZN -0.92% to Kohl’s Corp. KSS +0.49% and Wal-Mart Stores Inc., WMT +0.18% having promised to deliver items before Dec. 25, missed some delivery target dates.

United Parcel Service Inc. UPS +0.48% determined late Tuesday that it wouldn’t deliver some goods in time for Christmas, as a spike in last-minute shopping overwhelmed its system. “The volume of air packages in the UPS system did exceed capacity as demand was much greater than our forecast,” a UPS spokeswoman said.

Consumers were reporting missing deliveries from FedEx as well, although a FedEx spokesman said the company wasn’t experiencing significant delays.

[...]

Although weather, Web glitches and late deliveries from manufacturers played a part in late deliveries, the sheer unanticipated volume of holiday buying this year may have been the biggest problem, retail analysts said.

Having pushed delivery deadlines later this year, some merchants weren’t ready for a jump in online orders in the last few weeks of December, said Eric Best, chief executive of Mercent Corp., which helps more than 550 retailers with online sales. “During the holidays, we reach the limits on the capacity of these retailers,” he said.

At UPS, which delivers around 45% of U.S. packages, more shipments entered its air network on Monday than the 7.75 million it expected, the UPS spokeswoman said.

In notifications to some Amazon customers, UPS said there were some shipping delays because it had “not yet received the package from the shipper.”

“Amazon fulfillment centers processed and tendered customer orders to delivery carriers on time for holiday delivery,” said an Amazon spokeswoman Wednesday. “We are reviewing the performance of the delivery carriers.”

I did virtually all of my holiday shopping online this year, mostly with Amazon, and had no issues—including with a couple of gifts I bought Sunday, which arrived on time—gift wrapped, no less—on Christmas Eve. But I certainly understand the frustration of those who relied on retailers to deliver their presents by the promised deadline.

I tweeted the story last evening with the snark, “This could never happen in the private sector.” But this isn’t a slam at UPS, FedEx, or even Amazon and other retailers who made promises that their contracted carriers couldn’t keep. Rather, it’s a reminder that massive undertakings with lots of uncontrollable variables and tight deadlines have multiple points of failure and we shouldn’t be shocked when they fail. Had it been the US Postal Service, however, the outrage would be ramped up considerably.

It’s quite remarkable, actually, that retailers like Amazon can turn around shipments as fast as they do, particularly during the mad rush of the Christmas season. To do so, they have to ramp up staffing to capacities not needed 50 or so weeks a year. But, to actually get the orders to the desired doorstep, they have to rely on carriers. UPS and FedEx are phenomenally good at what they do but even they don’t have infinite, instant surge capacity.

To the extent that there’s a problem here, it’s that retailers like Amazon create unreasonable expectations. We’re so accustomed to being able to order something and have it arrive, like clockwork, at our doorsteps two days later that it’s completely shocking when it fails. They could, of course, reset expectations by not absolutely, positively promising to meet that deadline during the Christmas season, given that the number of orders not only surges but does so at an unknowable volume. If Amazon had a banner atop their site all month proclaiming, say, a December 19 deadline for absolutely guaranteed before-Christmas delivery, many of us would have changed our behavior accordingly.

 

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About James Joyner
James Joyner is the publisher of Outside the Beltway, an associate professor of security studies at the Marine Corps Command and Staff College, and a nonresident senior fellow at the Atlantic Council. He's a former Army officer and Desert Storm vet. He has a PhD in political science from The University of Alabama. Views expressed here are his own. Follow James on Twitter.

Comments

  1. Tony W says:

    I have been enjoying the “UPS Ruined Christmas” meme circulating around the internet. Because Christmas was not a surprise this year, having held it on the 25th as usual, I was prepared several weeks early.

    Highly-rated. Helpful or Unhelpful: Thumb up 16 Thumb down 1

  2. Ben says:

    Had it been the US Postal Service, however, the outrage would be ramped up considerably.

    Indeed. Luckily, most of the things I ordered online in the last week or so came via USPS, and made it on-time. The one item that we ordered that came UPS missed it’s scheduled delivery date by several days. Luckily, that one was ordered early last week, and got here on Tuesday afternoon, rather than last Friday, which is when it was supposed to get here.

    Like or Dislike: Thumb up 6 Thumb down 0

  3. Stonetools says:

    Well as we know when any organization misses deadlines and is unprepared for a surge in demand, that organization is not ready for prime time and is doomed.
    Or maybe that just applies to government agencies.

    Highly-rated. Helpful or Unhelpful: Thumb up 19 Thumb down 1

  4. Added into all of this, of course, is the unknowable and uncontrollable, meaning everything from mechanical problems with planes or trucks, delays create by factors such as traffic, and, especially at this time of year, weather. And, of course, the unknowable factor of just how much volume you’d be dealing with at the last minute. I haven’t seen official numbers but, by many accounts, online shopping increased this year by a larger percentage than anyone anticipated so that no doubt contributed to the problem.

    The obvious response to this is to increase personnel, but there’s only so much you can do in that regard, and you have to do most of the hiring well in advance of the first few days before Christmas.

    The other lesson, of course, is that procrastination is as big a risk for consumers in online shopping as it is in the bricks and mortar world. Waiting until the last minute to order that “must have” gift may not be the wisest course of action any more.

    Like or Dislike: Thumb up 5 Thumb down 0

  5. Todd says:

    Good, you caught it at the end. We last minute shoppers have only our own procrastination to blame for gifts that didn’t arrive on time. I got fairly lucky, even though I did the majority of my shopping on Saturday. Only one small package to my daughter didn’t get there yet … but 3 other gifts did, so no huge deal.

    Like or Dislike: Thumb up 1 Thumb down 2

  6. James Pearce says:

    Guess we shouldn’t privatize the USPS just yet……

    Although I disagree with this:

    To the extent that there’s a problem here, it’s that retailers like Amazon create unreasonable expectations.

    Who’s creating the unreasonable expectations? Amazon, who asks UPS/USPS, “Hey can you ship this 2nd day?” or UPS/USPS, who says, “Yeah, sure, no problem.”

    This is all on the shipping companies. If they were surprised by the Christmas rush, they have no one to blame but themselves. This was not only foreseeable, but it’s something that one would hope these companies prepare for.

    I shall quote Amazon’s PR flack:

    “Amazon fulfillment centers processed and tendered customer orders to delivery carriers on time for holiday delivery,” said an Amazon spokeswoman Wednesday. “We are reviewing the performance of the delivery carriers.”

    Dear Jeff Bezos:

    Invest in a delivery company. You’ll make a killing.

    Like or Dislike: Thumb up 13 Thumb down 1

  7. Tony W says:

    @Doug Mataconis:

    The other lesson, of course, is that procrastination is as big a risk for consumers in online shopping as it is in the bricks and mortar world. Waiting until the last minute to order that “must have” gift may not be the wisest course of action any more.

    Perhaps true – but you omit one key advantage – in the online world procrastinators get to blame somebody else.

    Like or Dislike: Thumb up 3 Thumb down 1

  8. Ben says:

    RE: procrastination and this being the consumer’s fault –

    Yes and no. Could people have ordered earlier? Sure. But when a website tells me that an item is GUARANTEED to be there by such-and-such date, I take their word on it. If it doesn’t get there, then that company f’d up, period. If it was beyond their power to guarantee a delivery date, then don’t freaking put one on your website. And if it’s the shipper’s fault, then that website should hold the shipper over the coals for that f up.

    Like or Dislike: Thumb up 9 Thumb down 0

  9. @Tony W:

    Have you ever been in a bricks and mortar store the last week before Christmas when some parent discovers that this years hottest toy is out of stock?

    Like or Dislike: Thumb up 3 Thumb down 0

  10. Tony W says:

    @Doug Mataconis: Good point Doug – those parents routinely blame the store or the greed of other shoppers. They couldn’t pay me enough to work the register at one of those stores for the abuse those poor souls take.

    Like or Dislike: Thumb up 2 Thumb down 1

  11. beth says:

    @Ben: Lots of people paid exorbitant prices for packages to be shipped overnight or two day delivery. I agree that UPS is going to have to come up with some sort of compensation, if only to redeem its reputation. If it was July, and I shipped a package and paid for two day delivery and didn’t receive it, I would expect a refund. Why not in December?

    Like or Dislike: Thumb up 5 Thumb down 1

  12. JKB says:

    I blame global warming

    Like or Dislike: Thumb up 1 Thumb down 2

  13. Stonetools says:

    Gotta say that I am amused by Doug’s benign and understanding view of the delivery companies for their miscues in implementation and his somewhat different response in the federal government’s implementation of the ACA. Where is the talk of broken promises.? Why are the UPS and Fedex statements guaranteeing delivery not proclaimed as “Lies of the Year?” Why aren’t these failures trumpeted as evidence that these private companies need to get out of the delivery business and leave things in the capable hands of the USPS?
    Instead we are told that things happen, that companies can’t expected to anticipate the size of the surge in demand in December, that winter storms can’t be predicted, and that somehow consumers are to blame for expecting companies to live up to the letter of the contracts that they wrote.
    Oh well, like I said, amused… But not surprised.

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  14. Woody says:

    But this isn’t a slam at UPS, FedEx, or even Amazon and other retailers who made promises that their contracted carriers couldn’t keep. Rather, it’s a reminder that massive undertakings with lots of uncontrollable variables and tight deadlines have multiple points of failure and we shouldn’t be shocked when they fail.

    This is a thoughtful statement, and ought to be a poster by every pundit’s microphone.

    Reality is much more mundane, and messier, than wishful fiction.

    Like or Dislike: Thumb up 2 Thumb down 0

  15. Liberal Capitalist says:

    Godwin said snow and ice in the Midwest last week and an ice storm that hit Dallas two-and-a-half weeks ago were partially to blame.”

    You know who else had problems with bad weather… ?

    Like or Dislike: Thumb up 7 Thumb down 0

  16. Ron Beasley says:

    My UPS problem was all at the local level. It took 2 days for the package to make it 1,200 miles to the local distribution center and then 6 days to make it the final 2 miles to my home.

    Like or Dislike: Thumb up 7 Thumb down 0

  17. bill says:

    i ordered something from best buy on monday, didn’t pay for fast shipping and expected my item to arrive friday maybe. i got an update from ups saying it should be here on Christmas eve….then it was delayed. no bfd to me, it’s coming today. as tony w said, Christmas is still on the 25th, as usual.

    Like or Dislike: Thumb up 1 Thumb down 0

  18. Mr. Prosser says:

    Of course the only ones who will really catch all the verbal abuse are the workers in brown uniforms and the clerks in the package store who actually face the customers.

    Like or Dislike: Thumb up 0 Thumb down 1

  19. PD Shaw says:

    I ordered through the Amazon marketplace on December 2nd, and received notice on December 17th that the order was lost. It looks like it shipped USPS. Was able to find it elsewhere cheaper even with overnight delivery, so it all worked out in the end. But in future I’ll think more about buying big, failure is not an option, gifts at local stores to avoid the stress.

    Like or Dislike: Thumb up 2 Thumb down 0

  20. al-Ameda says:

    @James:
    Never underestimate the ability of American consumers to be outraged, and to complain and whine about something, even at Christmas.

    By the way, a couple of friends pushed 2 day delivery to the bitter end and did NOT receive their items on time – they were really upset. But then again buying stuff at the last minute does have some risk.

    Like or Dislike: Thumb up 3 Thumb down 1

  21. Moderate Mom says:

    All the gifts I ordered online came in on time. The only problem I had was with the Post Office. I shipped a small box on Wednesday, December 18, and paid for two day Priority mail. The box did not arrive at it’s destination, the Dallas/Ft. Worth area, on the 20th, as promised. Nor was it delivered on Saturday, the 21st. It finally arrived late in the day on Monday, the 23rd.

    Does the Post Office issue refunds when it fails to deliver in the guaranteed time?

    Like or Dislike: Thumb up 0 Thumb down 2

  22. 11B40 says:

    Greetings:

    Obamacare-itis ????

    Like or Dislike: Thumb up 0 Thumb down 4

  23. michael reynolds says:

    @Stonetools:

    It’s interesting, isn’t it, the deep prejudice against government and in favor of private industry. The USPS delivers letters across country for fifty cents, while FedEx does it for 30 dollars, and yet we’re always ready to jump down the throat of the USPS.

    It’s like the way a several months-long web site fiasco “proves” we should keep government out of medical care, while decades of systematic fraud and deception carried out by private industry is shrugged off. We’ve been sold what amount to bogus health insurance policies that don’t cover anything and if you ever do get sick the policy is revoked, but that’s okay because it’s private industry screwing you.

    Or the way people rushed to find a way to blame the criminal negligence of banks and brokerages on government.

    Or the absurd paranoia around “Government Motors.” Because how could government possibly improve the situation for a private industry that had been run into the ground by private industrialists? Even when private industry is demonstrably incompetent, it’s assumed as an article of faith, that government will only make things worse.

    Or the way private industry can collect every last shred of data about you, and repeatedly fail to keep it safe, and it’s no big deal until we discover that the NSA has been reading over their shoulder. Then it’s the end of the world.

    Between the too-well-learned stories of Mr. Orwell and the too-readily-swallowed bromides of Mr. Reagan and all those nice, shiny corporate image commercials on Sunday morning TV, we’ve been very effectively brainwashed to see what ain’t there and dismiss what is.

    Highly-rated. Helpful or Unhelpful: Thumb up 19 Thumb down 1

  24. beth says:

    @Moderate Mom: There is no such animal as 2 day Priority Mail. The only Priority Mail that’s got a guaranteed delivery date is Priority Mail Express (which use to be known as Overnight Express). Priority Mail is now a 1-3 day delivery with no guarantee on the delivery date. They’ll tell you when they think it’s going to be delivered but make no hard and fast guarantees. This absolves them of the kinds of PR nightmare UPS is going through now.

    Like or Dislike: Thumb up 4 Thumb down 0

  25. Barry says:

    @James Pearce:

    “Dear Jeff Bezos:

    Invest in a delivery company. You’ll make a killing. ”

    No, you won’t. That’s the expensive part, the smaller blood vessels and capillaries.

    Like or Dislike: Thumb up 3 Thumb down 0

  26. michael reynolds says:

    Perfect example: McDonalds has a web site for its employees which, among other choice nuggets, offers advice on avoiding fast food. If that were government it would “prove” government is incompetent. But since it’s just McDonalds being stupid it doesn’t prove anything.

    Every abject failure of private industry gets a pass, every failure of government “proves” government can’t be trusted.

    Brainwashing.

    Like or Dislike: Thumb up 8 Thumb down 0

  27. Barry says:

    @JKB: “I blame global warming ”

    Please note that increased snowfall is to be expected; those who have any knowledge of snow will know why.

    Like or Dislike: Thumb up 8 Thumb down 0

  28. Stonetools says:

    @Barry:

    Well JKB is a conservative, so by definition he is science challenged. Evaporation, how does that work …

    Like or Dislike: Thumb up 4 Thumb down 0

  29. James Pearce says:

    @Barry:

    That’s the expensive part, the smaller blood vessels and capillaries.

    Ah, but that’s the beauty of it, Barry. Bezos needn’t worry his pretty little head about anyone else but Amazon customers, which makes the proposition much less expensive.

    From what I understand, same day delivery, which is currently beyond the capabilities of UPS, USPS, or Fed Ex, is definitely on the Amazon horizon. Indeed, it’s already a reality in several major cities.

    Like or Dislike: Thumb up 1 Thumb down 1

  30. steve s says:

    Well JKB is a conservative, so by definition he is science challenged. Evaporation, how does that work …

    I used to be a scientist. 50 years ago, we were mostly republicans. Now we’re 95% democrat. We didn’t change much, as a group. But the GOP sure changed, to cater to low-understanding people who want to hear comfortable lies, often very dumb ones about science.

    Like or Dislike: Thumb up 3 Thumb down 0

  31. michael reynolds says:

    @steve s:

    Once you’re a scientist aren’t you always a scientist? I assumed it was like the priesthood, or Mafia membership.

    Like or Dislike: Thumb up 3 Thumb down 1

  32. I didn’t buy that much stuff this Christmas (paying to replace your AC/heat pump system is a drag on your disposable income), but the only problem I had was Amazon relying on the completely useless UPS/Fedex + USPS system they created, combined with the fact that my local postal office is only opened four hours a day on weekends. An order was supposed to arrive the day before Thanksgiving but it was there until Friday, and I wasn’t able to pick up until Saturday.

    Like or Dislike: Thumb up 0 Thumb down 0

  33. wr says:

    Not being a Christian maybe I’m missing something essential about the holiday, but it seems to me that if your Christmas can be ruined by the failure to arrive of a late-ordered package or two, you didn’t have much of a Christmas to start with.

    Like or Dislike: Thumb up 7 Thumb down 0

  34. ernieyeball says:

    Just what qualifies one as a scientist?
    When I worked at the Wastewater Treatment Plant for the City of Murphysboro we took samples and ran tests at our laboratory all the time to be sure the effluent was safe to discharge into the Big Muddy River.
    All these assessments were gleaned according to the scientific method of finding things out.
    I still have my Certificate of Competency, dated 1977, issued by The Illinois EPA showing me as a Class 4 Sewage Treatment Plant Operator.
    Once a scientist…

    Like or Dislike: Thumb up 2 Thumb down 1

  35. PD Shaw says:

    @wr: You’re probably missing something if you haven’t been the parent of two or more kids, and a big gift from Santa comes for one, but not the other(s).

    Like or Dislike: Thumb up 2 Thumb down 1

  36. bill says:

    @michael reynolds: we can choose to not use (and not pay for) mcdonalds “product”, not so much when it come to the gov’t. – at least for those who do pay taxes.

    Like or Dislike: Thumb up 0 Thumb down 4

  37. patti bryant-ups new stanton,pa hub says:

    @beth: try working there during the Christmas rush and get back with me..we went above and beyond

    Like or Dislike: Thumb up 3 Thumb down 0

  38. beth says:

    @patti bryant-ups new stanton,pa hub: Patty I have no problem with the employees of either UPS or the US Postal Service. You guys work your butts off during this season. My beef is with a company that charges a whole lot of money for what they advertise as a guaranteed service and don’t deliver that service without offering any refunds. I mostly ship with the Postal Service because,while they don’t guarantee delivery, they also don’t charge an arm and a leg.

    Like or Dislike: Thumb up 3 Thumb down 0

  39. michael reynolds says:

    @bill:

    That says nothing about the confirmation bias in seeing government as invariably incompetent.

    Like or Dislike: Thumb up 3 Thumb down 0

  40. Really? says:

    What I saw this year with shipping was that amazon and amazon sellers were unable to get the packages to ups in time for the guaranteed Christmas eve delivery and also made mistakes with shipping labels by not shipping air and shipping ground and are blaming it on ups. Just because a label is made does not mean it made it to ups. Amazon and their sellers were overwhelmed and could not make the demand as guaranteed. As for Fedex they just didn’t deliver and dropped the ball….

    Like or Dislike: Thumb up 0 Thumb down 0

  41. b robinson says:

    @Tony W: you have to realistic when ordreing something online on dec 23..regardless of guarantees..of the physical limitations of the delivery companies involved

    Like or Dislike: Thumb up 1 Thumb down 0