They come the same time every year, but somehow the holidays can still take big package delivery companies like UPS and FedEx by surprise. Quite simply, UPS and FedEx need to be adequately staffed and operationally efficient enough to deliver packages on time during holiday season 2015. And based on performances of years past, the period of peak demand and the companies’ reactions to it may result in packages being delivered late again this year, an unacceptable outcome that negatively impacts earnings.
To prevent this type of holiday season disaster, both companies are taking action this year. FedEx has separate ground and air networks that can offer more flexibility during peak demand times, and it is hiring additional seasonal workers. UPS has reduced operating costs, implemented a new pricing strategy, and it is hiring up to 95,000 temporary workers.
The real problematic time is over a period of just a few a days during which the peak is difficult to predict due to retailers’ varying promotions. But shouldn’t the shipping companies be better prepared to meet surges in demand by now? What do you think?
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