UPS: No holiday break for shipping

Christmas may have passed, but the holiday shipping surge continues



According to UPS, the holiday peak shipping season will extend well into the first week of the New Year. On Jan. 6, 2016 (National Returns Day) alone, consumers are expected to ship more than a million packages back to retailers. By the end of the first week of January, UPS expects to deliver more than 5 million return packages, an increase of 500,000 from the 2014-15 holiday returns season.



Furthermore, according to the June 2015 UPS Pulse of the Online Shopper study, 45% of consumers have returned an item by shipping it back to a retailer. However, in good news for retailers, 42% of those said they made a new online purchase during the process.



Returns now play an important role in purchasing decisions as 67% of consumers said they look at a retailer’s return policy before they complete an order. Consumers also want a hassle-free returns experience. Sixty-six percent want free returns shipping and 47% want an easy-to-print return label.



Retailers have significant room for improvement in their return policies, though. UPS data shows only 32% of retailers offered free returns and less than half specified a merchandise exchange timeline on their website, which is a key component of the return policy that is viewed by 88% of online shoppers.



In an interview with CNBC, David Abney, CEO of UPS, said UPS completed all its holiday deliveries by Christmas Eve. He credited collaborative forecasting with customers, as well as flexibility in how it handles volumes and optimization of 70% of driver routes, for its delivery success.



“I wouldn’t say (the volume) surged throughout the network, Abney said. “But in two or three primary locations, we got much more volume than we originally thought. We developed ready teams where we moved UPS into those areas. We did some load shifting and changed our network around. Within a week, we had that problem resolved and then were able to quickly restore to our 97%-98% effectiveness as far as making service.”



Abney also denied Wall Street Journal reports of tense relations with Amazon.com, one of its biggest customers.



“We just don’t see how any of our large retailers would be better off without us,” said Abney. “We feel very comfortable in that relationship.”