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This week in parcel, Amazon surpasses UPS and FedEx in deliveries, Walmart adds parcel stations and UPS announces new SurePost rates.

UPS and FedEx are no longer on top

Amazon has surpassed UPS and FedEx as the largest carrier by number of packages delivered to U.S. homes. The company surpassed UPS in volume in 2022 and FedEx in 2020.

The e-commerce giant internally projects to make approximately 5.9 billion deliveries by the end of the year. This is over five million more packages than FedEx’s projections.

While UPS and FedEx estimates include packages that were handed off to the U.S. Postal Service for last-mile delivery, Amazon’s figures only include packages the company handles from beginning to end.

FedEx stopped making deliveries for Amazon in 2019 but UPS still makes deliveries for the company, seeing its partnership as mutually beneficial.

Our take: If it wasn’t clear already, Amazon is setting itself up to be a large presence in the parcel delivery space. What’s not clear is how willing other retailers will be to allow Amazon (a frenemy) to make their customer deliveries. Regardless, Amazon is one more significant market pressure that FedEx and UPS face.

Read more here.

Walmart adds parcel stations to improve delivery speeds

Looking to shorten delivery times, Walmart has added 40 “parcel stations” to speed up last-mile delivery times.

According to Jennifer McKeehan, SVP of transportation and delivery for Walmart U.S., the stations are like mini post offices.

The big-box retailer plans to have 40 parcel stations across nine states operating in its stores by the end of the year, with some already operating.

These stations help Walmart offer more products for next-day delivery and make the distribution process easier for employees.

In addition to speeding up same-day delivery times, the stations also help lower the company’s e-commerce margins by increasing density and enabling more packages to be delivered per stop.

Our take: Amazon is not the only retailer posing a potential threat to UPS and FedEx. Look for Walmart to continue to innovate and search for ways to leverage its scale it terms of how it competes with Amazon . . . and by extension FedEx and UPS.

Read more here.

UPS announces 2024 SurePost rates will increase

UPS has announced its 2024 SurePost rates will be effective starting December 26, 2023.  The carrier did not announce a headline for the average increase amount, but a first glance shows that the minimum is now over $11 — $11.07, precisely — and each surcharge category is increasing as well.

Additionally, the carrier announced that Retail rates for Ground, Air, and International would increase, as would Small Business rates.

Our take: The full perspective on 2024 rates is coming into focus. Contact TransImpact for a no-obligation analysis on how this SurePost increase, as well as the UPS and FedEx GRIs, will impact your small parcel shipping costs in 2024.

Read more here.

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