Time for delivery companies to work weekends

Submitted by brad on Thu, 2011-12-22 15:49
Topic: 
Transportation
Internet

This time of year I do a lot of online shopping, and my bell rings with many deliveries. But today and tomorrow, not Saturday. The post office comes Saturday but has announced it wants to stop doing that to save money. They do need to save money, but this is the wrong approach. I think the time has come for Saturday and Sunday delivery to be the norm for UPS, Fedex and the rest.

When I was young almost all retailers closed on Sunday and even had limited hours on Saturday. Banks never opened on the weekend either. But people soon realized that because the working public had the weekend off, the weekend was the right time for consumer services to be operating. The weekend days are the busiest days at most stores.

The shipping companies like Fedex and UPS started up for business to business, but online shopping has changed that. They now do a lot of delivery to residences, and not just at Christmas. But Thursday and Friday are these odd days in that business. An overnight package on Friday gets there 3 days later, not 1. (If you use the post office courier, you get Saturday delivery as part of the package, and the approximately 2 day Priority mail service is a huge win for things sent Thursday.) In many areas, the companies have offered Saturday and even Sunday delivery, but only as a high priced premium service. Strangely, the weekend also produces a gap in ground shipping times -- the truck driving cross-country presumably pauses for 2 days.

We online shoppers shop 7 days a week and we want out stuff as soon as we can get it. I understand the desire to take the weekend off, but usually there are people ready to take these extra shifts. This will cost the delivery companies more as they will have to hire more workers to operate on the weekend. And they can't just do it for ground (otherwise a 3 day package sent Friday arrives the same time as an overnight package.)

Update: I will point out that while online shipping is the David to the Goliath of brick & mortar, changing shipping to 7 days a week will mean a bunch more stuff gets bought online, and shipped, and will bring new revenue to the shipping companies. It's just just a cost of hiring more people. It also makes use of infrastructure that sits idle 2 days a week.

This is particularly good for those who are always not hope to sign for packages that come during the work week. The trend is already starting. OnTrak, which has taken over a lot of the delivery from Amazon's Nevada warehouse to Californians, does Saturday delivery, and it's made me much more pleased with Amazon's service. When Deliverbots arrive, this will be a no brainer.

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Comments

Phillip Helbig

Fri, 2011-12-23 02:01

Not that long ago, 12 hours a day, 6 days a week were the normal working hours. The fact that most people work less today (at least in the civilized world; I'm not talking about the States where 3 minimum-wage jobs are needed to pay the mortgage on the oversized house and finance the SUV) is an example of progress. Yes, you might appreciate people working on weekends, but I don't think that most people working on weekends appreciate it.

Lets do the maths. Basically, people spend all they can (and more); there is not a problem of people not being able to spend their money. This means that working weekends will cost more, even if there is somewhat less work during the week. This means the prices will go up.

Is there anything really so important that you can't wait an extra 2 days so that someone can spend some time with his children?

Phillip Helbig

Fri, 2011-12-23 04:09

"We online shoppers shop 7 days a week and we want out stuff as soon as we can get it. I understand the desire to take the weekend off, but usually there are people ready to take these extra shifts. This will cost the delivery companies more as they will have to hire more workers to operate on the weekend. And they can’t just do it for ground (otherwise a 3 day package sent Friday arrives the same time as an overnight package.)"

That about sums it up. If it were not a financial loss for the companies, I'm sure they would be doing it, so it probably is a loss. If you want the premium, why not pay for it? I don't think "online shoppers demanding" is really the way to go about this. Consider that the bloke driving the lorry probably doesn't earn enough to shop 7 days a week.

James

Fri, 2011-12-23 05:22

We might have a bit of a chicken-and-the-egg problem. Weekend delivery is expensive, so few people use it. But, if more people used it, it would cost less per package. The other thing to consider is that most packages are still going to take two days to deliver, even with deliveries being made 7 days a week. I think the general mindset is, "if I have to wait 2 days, it is a big deal to wait 3 or 4?" When you need it NOW, you are not going online to get it anyway. Think about a guy who rips his good shirt the morning of a job interview. He is not going to fire up his computer, he is going to the mall to buy a new one. I too have bought exciting "toys" online, and been frustrated that I can't have it right away. But, I went online because I saved money, and I selected the cheapest shipping option to maximize my savings.

p

Fri, 2011-12-23 06:59

Yes, there is some small chicken-and-egg problem. However, the main point is that no more money can be spent than is already being spent, and weekend deliveries mean extra costs, so in the long run the only way to do this is to increase the cost, either for all deliveries or charge a premium for weekend deliveries.

Think of a 24-hour supermarket. More convenient for shoppers? Yes. Do people buy more food as a result? No. So, this means that the prices go up since even if fewer people shop during the normal hours, there are fixed costs associated with opening a store, so opening at all hours generates more costs.

The problem here is that if one store starts, then it will get more revenue, so others have to follow suit, but the end result (as far as prices go) is worse than if none had tried. Sort of like the prisoner's dilemma.

brad

Fri, 2011-12-23 17:12

Do people buy more food because of a 24 hour store? Perhaps not. But they do buy more from that store. And they may buy more of other things.

But today, online commerce is big but still small compared to brick and mortar. One of the things that sits in the way of online commerce is shipping time. Yes, faster shipping costs money, as does 7 day/week shipping. But customers want it. Is 5/days week the most efficient sweet spot for shipping? If 6 days/week costs more, does 4/days week also cost more, or would it cost less? There are many factors -- economies of scale, customer demand, and cost of infrastructure (depots, trucks) spread out over the days of the week vs. cost of operations (people, fuel, etc.) which spread out in different ways.

My point is that with online and 2 day delivery, which is what I get with Amazon Prime, if I am ordering Thursday or Friday, I am much more likely to order online if I can get it Saturday or Sunday rather than Monday or Tuesday. Otherwise that 2 day penalty might send me to a brick and mortar store, or to another online store with a closer depot when it comes to ground shipping. So 7 day shipping will increase the amount of shipping business, possibly by a lot. It's not like food at all. If everything were bought online, then you could debate what's the optimum shipping frequency.

And by the way, I think that optimum frequency might be more than once/day. I think in the future, shipping times will be measured in minutes and hours for many products, and 2 day shipping will be 30 hour shipping or 47 hour shipping. I think it's already time to move that direction. One thing that does sit in the way is the normalization of sales tax. Amazon does so much business in California that to avoid sales tax it has a huge warehouse near Reno that can easily get stuff to California in 1-2 days. The tax saving is big, but the real answer in the future will be a warehouse 30 minutes away and robot delivery options, and the brick and mortar industry will be radically downsized.

Niina

Fri, 2012-01-27 08:53

I completely agree with you Brad. I don't understand why weekend deliveries are not the norm. Retail, Restaurant, and overall entertainment industries work weekends. Why can't the postal service. Jobs are needed now more than ever. There are plenty of people who would kill for the job. Prices for weekend delivery should be the same as every other day as well. Transportation is no way limited on the weekend so there is no excuse for the price increase. This generation needs everything everyday, and as soon as possible, which in most cases, next day. Suppliers better meet demand, or they will fail.

Matthew Newton

Wed, 2012-02-01 04:40

I'm torn. Obviously this would mean more working opportunities for those who need it, but then again the weekend is being eroded bit by bit and it irks me.

It seems that the companies don't believe they would generate enough business to compensate for running up their costs so much.

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