Posts tagged with "FedEx"

Many happy returns: Retailers are ratcheting up the competition over fast, convenient delivery. Next up? Returns.

November 25, 2019

U.S. shoppers are starting to expect instant gratification. Buy something online and you’ll see it on your doorstep sooner rather than later. But when you want to return that item? Not so fast.

Now, The Chicago Tribune reports, a growing number of online retailers—from e-commerce giant Amazon to small apparel and footwear brands—are teaming up with brick-and-mortar chains to make returns less of a hassle; or at least no worse than the  transaction a customer would experience in a traditional store.

“If people can’t see it or touch it (when they first buy it), they want the option to return it,” Scott Rankin, principal at KPMG BrandVoice in the retail sector, told the Tribune. “Sometimes, they want to do it in a physical store because it’s just easier.”

The trend already is in evidence: Since early 2019, customers have been able to return many items bought on Amazon at any Kohl’s store. And delivery companies UPS and FedEx are partnering with chains like CVS and Walgreens to give shoppers more places to pick up and drop off packages.

Even some smaller online brands now offer in-store returns through Happy Returns, a California-based company that lets shoppers return items from more than 300 digital brands at more than 700 locations nationwide, mostly in malls and in cooperation with national chains like Paper Source and CostPlus World Market.

The Happy Returns service enables companies such as Revole, a women’s apparel brand, and Rothy’s , a footwear brand, to tout easy returns on their websites, The Chicago Tribune reports.

In-person returns with Happy Returns, Revolve’s website says, require “No receipt, return label or shipping box necessary! You just provide your email address or order number and your refund will be initiated immediately.”

In-person returns generally mean quicker refunds, which seems to be the biggest attraction for shoppers, Happy Returns co-founder and CEO David Sobie told the news outlet. But customers also like being able to skip the “arts and crafts project” of prepping items for shipment, he said. Happy Returns gives customers refunds on the spot— no box required.

For stores accepting other brands’ returns, it can be a way to get new customers in the door. Online retailers, meanwhile, know hassle-free returns can make customers more confident about clicking “buy.”

With the holidays fast approaching, in-store returns programs are about to undergo a major test, the Tribune says. U.S. consumers are expected to spend nearly $144 billion online this holiday season, up 14.1% from last year, according to Adobe Analytics.

And those same consumers will be sending millions of unwanted items right back.

In fact, UPS told the Tribune that it expects to handle a record-breaking number of returns this holiday season, with more than 1 million return packages expected to be shipped each day in December, peaking at an estimated 1.9 million packages on January 2.

As for the retail partnership, when they are fully rolled out, both UPS and FedEx said 90% of the U.S. population will live within five miles of a location where they can pick up or drop off a package.

Most of the packages people drop off are returns, and they generally choose the location that’s closest or has the most convenient hours, Scott Harkins, FedEx’s SVP of Customer Experience Marketing told the news out.

“Really, it just comes down to convenience,” Harkins said.

Research contact: lzumbach@chicagotribune.com

Cash on delivery: The selling of our mailboxes

December 13, 2018

The government is looking to “sell” Americans’ last bastion of privacy—our mailboxes—posthaste.

Specifically, in seeking ways to boost revenue for the U.S. Postal Service‘s money-losing operations–the Trump Administration is suggesting selling access to mailboxes, according to a December 11 report by CBS News.

“The legal mailbox monopoly remains highly valuable,” said a government report issued last week. “As a means of generating more income, the mailbox monopoly could be monetized.

While the report didn’t detail how much the USPS could earn from franchising mailboxes, it suggests that the USPS could charge third-party delivery services such as UPS or FedEx to gain access to consumer mailboxes, the network news outlet said. It’s currently illegal for other delivery services to drop packages or letters in a mailbox–a restriction that even applies to neighbors stuffing flyers for a local event.

The recommendation—a product of a task force created by President Donald Trump and chaired by Secretary of the Treasury Steven Mnuchin—is just one of the ideas that the group made to tweak the USPS business model. According to the report, as of the end of FY 2018, the USPS balance sheet “reflects $89 billion in liabilities against $27 billion in assets—a net deficiency of $69 billion between FY 2007 and FY 2018.”

Other proposals from the group included cutting costs and boosting prices for “nonessential services,” including delivery of commercial mail, such as advertising flyers, CBS News reported.

“As [mail service providers] and package delivery companies continue to expand offerings to multiple parts of the value chain, it is reasonable to expect a willingness to pay for access to USPS mailboxes,” the report noted. “By franchising the mailbox, the USPS could expand its revenue and income opportunities without necessitating any change to its current mail products.”

But the economics might not be as rosy as the Trump administration report suggests, Robert Atkinson, president of the Information Technology and Innovation Foundation, a think tank that focuses on productivity and innovation issues, told CBS News.

“Nobody knows what the economics of that are,” Atkinson said in an interview with the network news operation. “Right now, say what you want about the Postal Service, but the part that is perhaps the most efficient is the last-mile delivery,” or the delivery from postal offices to consumers’ homes.

Instead, it could actually backfire and end up costing the USPS more money, Atkinson warned: “One of the reasons the USPS is not even more financially troubled is because they have this monopoly for delivery” to your mailbox, he explained.

If the USPS sells access to consumers’ mailboxes, even more businesses may opt for rival services such as FedEx or UPS. It’s not clear whether the franchise fees would offset the loss of that mail revenue, he added.

“I’m dubious that they could charge a price that could be any better than they already make, because then they’d be delivering fewer of those letters or packages,” Atkinson said.

While the report didn’t single out Amazon, the online retailer , President Trump repeatedly has blamed the company for some of the USPS’ financial woes. The president has claimed the USPS loses $1.50 on average for each package it delivers for Amazon.

There’s little evidence to back up his claims, however, as the package delivery remains one of the few lines of business that’s growing for the USPS, CBS reports.

Research contact: @aimeepicchi

As China continues to ‘go low’ on shipping rates, Trump moves the bar higher

October 22, 2018

President Donald Trump is threatening to intensify the trade war between the United States and China by ordering the U.S. Postal Service to withdraw from a treaty that has set shipping rates among 192 member nations for 144 years.

The Universal Postal Union—established in 1874 and adopted as a body of the United Nations in 1948—has enabled developing countries to pay lower rates when shipping packages internationally; often putting some of the cost of delivering packages on the postal services of wealthier countries.

Indeed, according to an October 17 report by Politico, the policy initially was intended to spur economic growth in poorer countries by connecting them with global markets.

But now that some of those countries—including China—have become exporting giants, the Trump administration hopes to use its withdrawal as leverage to negotiate more favorable terms for historically wealthy countries, like the United States.

Reaction has been mixed. A senior administration official told Politico that  the administration would prefer to stay within the union and that a full withdrawal takes a year to implement. Therefore, he said, he hopes that America can negotiate more favorable terms within that time frame.

“You could have something shipped from Indiana to New York and it would be more expensive than having it shipped from China because of price distortion introduced through the [old] rates,” Professor Rick Geddes, a postal service expert and Director of the Cornell Program in Infrastructure Policy at Cornell University, told NBC News for an October 19 story.

Companies such as Amazon and FedEx have long taken issue with the treaty, the network said—both citing what they believe are unfairly discounted shipping rates for foreign shippers.

However, on the plus side, American manufacturers, believe that withdrawing from the agreement would level what they see as an unfair playing field.

Indeed, Jayme Smaldone, CEO of the New Jersey–based company, Mighty Mug, wrote an opinion piece for the Wall Street Journal last February, noting that his firm paid $6.30 to ship by regular mail; but a Chinese company that sold a knock-off version could ship it to the same location from 8,000 miles away for just $1.40.

Jay Timmons, CEO of the National Association of Manufacturers, told

NBC News that the administration was making a positive move. “Manufacturers and manufacturing workers in the United States will greatly benefit from a modernized and far more fair arrangement with China,” he said.

American consumers had for years benefited from lower e-commerce prices on sites like Amazon and eBay when buying lower-priced Chinese goods. Without the discount, those sellers could evaporate and U.S. online shoppers would have to pay higher prices.

“Chinese sellers on eBay and other platforms may disappear, or at the very least they will not find it so easy to sell to Americans anymore,” Gary Huang, chairman of the Supply Chain Committee of the American Chamber of Commerce in Shanghaitold Bloomberg.

He added, “American consumers will have less access to that really cheap stuff.”.

Research contact: @matthewchoi2018