- 31 January 2019
- Transport / Logistics Services
Going head to head with its client and rival Amazon, FedEx is offering a late night shipping option for US e-retailers who want to get orders to customers at expedited speed.
Customers of FedEx’s clients will be able to receive next day delivery if they order before midnight.
The delivery company’s chief marketing officer Brie Carere said that less than 1.3% of its revenue now comes from Amazon and this is not set to increase so FedEx now believes the time has come to compete with the online giant.
“We are not dependent on Amazon for growth,” Carere said. “We’re very optimistic and very, very confident in the growth of the market outside of Amazon.” She said FedEx sees $550bn in potential sales in the global markets they’re targeting.
Amazon has become a threat to US delivery companies as it grows its Amazon Logistics segment.
Carere said that about half of US online purchases are made after 16:00 daily and the new service from FedEx is expected to considerably help its client retailers such as AutoZone and Best Buy.
The new FedEx service will have drivers pick up parcels as late as 02:00 local time and take them for sorting. Within the local market this will allow next day deliveries while for those further afield this can mean two days.
The program was piloted in Los Angeles in 2017 and has now been rolled out to 100 other cities. It has required no additional investment for FedEx.
“We’ve really seen a change in the market where retailers have recognized that their physical distribution is a competitive advantage and it allows them to actually get things faster to market,” she said. “This is from point of fulfillment to delivery, all within a 24-hour cycle. That’s very, very competitive.”