The USPS Is E-Commerce's Biggest Challenge

Discussion in '[H]ard|OCP Front Page News' started by Megalith, Jun 18, 2017.

  1. Megalith

    Megalith 24-bit/48kHz Staff Member

    Aug 20, 2006
    J.C. Penney’s CEO is worried that shipping companies cannot keep up with the growing rate of e-commerce and the demand for quicker delivery. While the USPS, UPS, and Fedex are getting more business than ever, he claims that none of them have been making an effort at increasing capacity. The postal service, in particular, is being singled out as the least likely to handle the escalation well. I am actually surprised things haven’t come to a “screeching halt” yet due to the increasing prominence of same-day or next-day orders.

    ...e-commerce companies' "biggest challenge" going forward is that while giants like Walmart Stores Inc. and Inc. push for faster delivery, the United States Postal Service, in particular, won't be able to keep up, at least for the same cost that exists today. "Fulfillment costs are increasing dramatically because we have UPS, Fedex and USPS as the three main entities to ship and fulfill orders and they're not increasing capacity to deliver at the same rate e-commerce is growing," [J.C. Penney CEO Marvin ] Ellison said. He said this will cause a supply and demand issue "that's going to be apparent here pretty soon."
  2. Term-X

    Term-X 2[H]4U

    Apr 21, 2001
    I've noticed here in Canada, especially for next day delivery, Amazon has been resorting to using it's own shipping arm to take care of it. I rarely see these guys drop off the package but the couple of times I have it's usually random dudes in cars/vans that they seem to hire to drop them off.
    Talyrius and Burticus like this.
  3. Commander Shepard

    Commander Shepard Proud Brony

    Apr 12, 2016
    Most of my next-day and all of my same-day orders from Amazon are shipped by Amazon's courier service, AMZL-US.
  4. STR

    STR Gawd

    Nov 10, 2005
    I'd say 90% of my Amazon shipments have shifted to their in house service, with the rest mostly picked up by USPS.

    I actually miss UPS and FedEx. They have far more reliable tracking sites, so you know exactly where in the country your item is sitting.
  5. necrosis

    necrosis Gawd

    Oct 21, 2004
    USPS is garbage and needs to die or have a MASSIVE overhaul.
    Amazon NEEDS to allow you to select who is shipping your stuff. I am beyond sick of packages coming via LaserGarbage (LaserShip). Last package was said delivered on a Friday at a how I know our work post office was not open. Called amazon, LS, everyone I could trying to find out where the hell the package was. It showed up on the following TUE with ritten on the package "location closed". THEY WHY THE HELL WAS IT MARKED DELIVERED?

    These companies have bigger issues than volume.
  6. ICOM

    ICOM 2[H]4U

    Jul 27, 2004
    Personally, I really don't care much about the speed of deliver for items that I've purchased on-line. Anything within 4-5 days is perfectly acceptable for me. If I "need" expedited delivery, I'll pay the extra cost. It's just not that important a matter for me. I'll gladly give up 1-2 days delivery time for the sheer convenience of on-line purchases.
    Wierdo and anthrex like this.
  7. Macblastr

    Macblastr Limp Gawd

    Aug 6, 2015
    As someone who ships worldwide every day, you have it 100% backwards... ups is a joke, and i have no idea how fedex is still in buisness. USPS is the cheapest and fastest by far.
    gtrguy and Gigantopithecus like this.
  8. Snowdensjacket

    Snowdensjacket Limp Gawd

    Apr 10, 2017
    I am a UPS driver and I'll tell you we are way way behind on our capacity. Management knew this was happening years and years ago but at each level of management that guy or gal won't get there bonus unless they meet all kinds of specific quotas. So that's all they care about. Meeting those quotas for that quarter, so they can get their bonus.

    Now that our lack of capacity has run head first into the massive growth of e-commerce, and we've been failing to be able to meet the demand, they are finally starting to take steps to increase capacity.

    There are other serious problems inside UPS as well. The economy is doing very well here so UPS can't hire enough employees since they want to start them at $10.50 an hour with no benefits. Those same employees are going to work at fast food places for $11 an hour with shitty benefits, or at Wal-Mart for $12 an hour and mediocre benefits. We're short two hundred employees and it's going to get worse. But management won't do anything about it for another quarter or two, when they can do so without it affecting their bonuses. Tis how the retarded system works.
    spacecowboy863 likes this.
  9. Gorankar

    Gorankar [H]ardForum Junkie

    Jul 19, 2000
    USPS is hit or miss at the local level. My last place, USPS was great, on par or better than UPS or Fedex. At my current home, you are just as well off to throw it in a dumpster than use USPS. USPS, and other carriers using USPS for last mile delivery, is why I cancelled Amazon Prime.
  10. Gigantopithecus

    Gigantopithecus [H]ardOCP Case Reviewer

    Aug 6, 2009
    This is entirely consistent with my experience from 2004-2013 as an eBay powerseller. USPS had the lowest error rate, then UPS and FedEx were similar, and a distant second. Then again UPS and FedEx were usually cheaper for urban and suburban deliveries and USPS was cheaper for rural deliveries, so I could not control for that potentially important variable in my analyses.
    Wierdo and wirerogue like this.
  11. westrock2000

    westrock2000 [H]ardForum Junkie

    Jun 3, 2005
    Oh, so THATS what J.C. Penny's problem is. Glad they finally figured it out.

    This, is my opinion, is like another industry. The big companies want to hit low price points to attract customers. But they rely on someone else infrastructure to deliver their product. They want the infrastructure increased, but they do not want to pay for it because it would hurt their bottom line. Someone has to invest the money.
  12. Iching

    Iching [H]ard|Gawd

    Nov 29, 2008
    USPS isn't in the business of making money. USPS gets $18 Billion In Subsidies And 'Special Privileges'. It lost $50 billion since 2007. It has to be reformed to be more efficient but like any other local, state, federal instituition it's a job program which we subsidize.
    Seventyfive and Snowdensjacket like this.
  13. vegeta535

    vegeta535 [H]ard|Gawd

    Jul 19, 2013
    Ups used to be shit around here years ago and FedEx was great. Nowadays it is the opposite. USPS is in the middle. Not the fastest but their rate are not that bad and pretty reliable.
  14. Spidey329

    Spidey329 [H]ardForum Junkie

    Dec 15, 2003
    True. A lot of the subsidies go towards the pension load. USPS could modernize and be quite efficient with their footprint, but the APUW would never let that happen. Heck, they just recently (as of the last few years) started modernizing their tracking system. So many branches here in Vegas have such weed overgrowth it looks like a scene from an apocalypse movie.
  15. UrielDagda

    UrielDagda 2[H]4U

    Nov 16, 2004
    The issue is in changes that were made in how they paid into the pension fund in 2006, which, on top of their normal pension funding, doubled the amount to pre-fund future pensions. Ever since then they've been hemorrhaging money. Traditionally the USPS is supposed to be self-sustaining. Congress has to fix that issue, or use some taxpayer money now to have it permanently pre-funded at a set value, then from that point on, being able to be sustained into the future without taxpayer money. They can't get out of the red because what was enacted in 2006 put them into a cycle they can't escape from.
  16. sirmonkey1985

    sirmonkey1985 [H]ard|DCer of the Month - July 2010

    Sep 13, 2008
    you are correct and that ends this year.. USPS averages 480m dollars in profit yearly, the 5 billion in losses yearly is paper money, they don't actually pay into the funds and that's what the "subsidies" funds people talk about are actually paying for. there was zero reason for the USPS to be putting money into that horse shit knee jerk reaction fund.

    as far as my experience goes working for USPS and air freight specifically there has been no change in how much mail we send out and deliver in the 2 years i've been there. i'd say the ones getting hit the hardest are the USPS distro's that are located near amazon warehouses.. since fedex only does 1 incoming and 1 outgoing flight a day for USPS. cities like SFO, seattle, NY they tend to have some roll over mail but instead of holding it there 24 hours they'll usually truck it to nearby distro's to load into their allotment of air freight containers. personally i'd welcome more mail, means more consistent hours for me since my hours are tied directly to how much mail we move.

    fedex is only in business still because USPS uses them for their airfreight delivery, if it wasn't for that the company would of gone belly up years ago or been bought out by some one else.. personally i wish USPS would just take over fedex so they'd have their own air freight service. i'd say 90% of the damaged mail we receive is directly caused by fedex employee's because they think that since it's not fedex mail they're not responsible for it.

    the system is insanely complicated for USPS because they use so many 3rd party services.. ground trucking is contracted along with airfreight being contracted to 2 different airlines and fedex and the way mail is handled through each one is completely different. but the trucking is the worst since truckers won't bother to tell USPS that they've gone over their daily driving hours so they'll pick up a load then drive a few miles down the road and park there and sleep. but the only way to know when that happens is when the truck doesn't show up to it's destination within it's set time.
    Last edited: Jun 18, 2017
    SuicidalGoat likes this.
  17. Teenyman45

    Teenyman45 [H]ard|Gawd

    Nov 29, 2010
    The post office isn't allowed to make money. Congress has been kneecapping the post office for years. Add to that is the congressionally imposed requirement to fully fund a very large pension obligation decades in advance and it's easy to see why the post office has had budgetary issues for the last decade or so.

    As much as the USPS has lost out from delivering all the junk mail (much of which converted to email spam) some of the slack has been picked up for e-commerce deliveries. Nobody else has the scale to do last mile properly. Fedex and UPS frequently contract out to the post office for last mile delivery in rural, exurban, and even suburban areas because trying to maintain the infrastructure was hurting their bottom lines.
    ncjoe and tungt88 like this.
  18. risc

    risc [H]Lite

    May 18, 2017
    Any links for the legislation or regulations?
    I haven't heard of this legal requirement, also junk mail is sadly a large financial component of USPS, they hold the market.
  19. Uvaman2

    Uvaman2 [H]ard|Gawd

    Jan 4, 2016
  20. Budzman

    Budzman Gawd

    Jul 9, 2001
    I can tell my mailman gets annoyed every time he has to get out of his truck to bring my amazon delivery to my house.
    Burticus likes this.
  21. ng4ever

    ng4ever Flaccid 4Evar

    Feb 18, 2016
  22. OEM

    OEM My Fingers Stink

    Jun 15, 2005
    There aren't enough likes in the galaxy for this.

    Fuck USPS.

    HA! In what galaxy do you live in? Any USPS employee I've ever dealt with is a useless piece of shit who knows they can't be fired and works accordingly.
    Burticus likes this.
  23. dr.stevil

    dr.stevil [H]ardForum Junkie

    Sep 26, 2008
    Can't agree more!

    USPS sucks so bad. I'm constantly having issues with them. I've actually stopped using Amazon as much as I used to because of it. I'd love the ability to select your preferred shipping company
  24. Burticus

    Burticus 2[H]4U

    Nov 7, 2005
    Yup. USPS to my house is hit or miss. My primary mail carrier (carrier is an oxymoron, he rarely gets out of his van) is slow but fairly reliable/predictable. Yeah sometimes boxes don't make it all the way to my porch and get rained on, but he's consistent.

    When that guy is out sick or on vacation, all hell breaks loose. I might not get mail for days at a time. Or I get my neighbors mail, and they get mine. Sometimes packages show "delivered" or "attempted delivery" when I know for a fact no attempt was made. That pisses me off, then I have to go to the post office and stand in line for an hour.

    Fedex and UPS seem reliable around here, and their tracking systems are much better than USPS.

    And for Amazon, sometimes I see a white panel van with a Amazon logo, other times it's randos driving their own cars dropping stuff off.
  25. mrp

    mrp n00bie

    Oct 28, 2005
    I must be the lucky one, I have a great USPS mail carrier, unfortunately he is planning on retiring this year. Service is definitely a bit slower when he is on vacation, Sunday deliveries range from dropping things at the mailbox to opening the "people gate" and bringing things to the front door. I do live in a rural area where we are on a first name basis. The fedex carrier brings dog treats and UPS stops to talk if I'm in the yard.
    Back to JC Penny's, delivery should be the least of their concerns.
  26. GotNoRice

    GotNoRice [H]ardForum Junkie

    Jul 11, 2001
    I guess with USPS it's a matter of getting lucky or not based on how they serve your area. I love USPS personally. It's usually the cheapest and in my case also tends to give service comparable or better to the other carriers. I know my mail lady on a first-name basis so there is never an issue with delivery. USPS overall almost always gets stuff to my house in 2-3 days (within the US), which is why I never felt any need to subscribe to Amazon Prime. Only "problem" I've been having is that since I'm not a Prime subscriber, it seems like Amazon has started sitting on my packages for a few days before shipping them. Can't really blame the carrier for what happens before it gets into their hands though... Should I pay for prime just to restore the normal service that I used to get for free, or shop somewhere else? Tough choice... not.
    Gorankar likes this.
  27. Merc1138

    Merc1138 [H]ard|Gawd

    Sep 25, 2010
    USPS is certainly the cheaper option, and their tracking has definitely gotten better over the years, but god damn they can be so infuriating at times.

    Out of the 3 big carriers in my area:
    The only one to mark packages as delivered but not actually deliver them because they marked them all at once and then never actually got to my home or business, USPS.
    The only one to mark package tracking as delivery attempted to a business with a receptionist at the front desk during normal business hours, USPS.
    The only one I've ever caught(multiple times now) with a pre filled out slip in their hand at the door(hearing someone at the door as I walk past), USPS(this one pisses me off the most because they already had the slip filled out, no package in hand, and already went to the door)
    The only one to leave packages out in the rain instead of under the awning 2 feet to the right, which is actually closer to where they walk to the door from, USPS.
    The worst employees at their retail locations, USPS, with UPS a very close second because they're all just crappy franchises.

    It drives me nuts when I can't choose a shipping option, as most times I'd gladly pay a few bucks extra to not risk putting up with USPS' bullshit in the county I live, or the county I work in.
  28. steakman1971

    steakman1971 [H]ard|Gawd

    Nov 22, 2005
    Our normal USPS carrier is pretty good. However, I've had many packages that were supposed to be delivered in 2 days end up taking 3. I've complained to Amazon a few times, they give me more time for Prime (which I don't really care about - I'm more interested in getting my stuff on time.)
  29. Teenyman45

    Teenyman45 [H]ard|Gawd

    Nov 29, 2010
    From the first, fast google search congress limits post office

    A blog linking to the now rightwing site Zerohedge

    Left wing thinkprogress and author who now works at the intercept

    First link from the search post office not allowed to make a profit (note when I typed "post office not" google's autocomplete filled in the rest of that search)

    This plays out in the lack of post office merchandise (which would otherwise be a thing) the removal of post office banking (which provided a major boost to check cashing and payday lending predatory "business" as well as allowing banks to increase user fees) and congress interfering with the post office's ability to directly compete with FedEx and UPS.
  30. sfsuphysics

    sfsuphysics I don't get it

    Jan 14, 2007
    Kind of what I was thinking when I read that... "What is JC Penny deflecting?" this is the company that not too long ago decided to not screw around with people and have everything rounded to the nearest dollar! then no more sales since everything was on sale (or someshit like that) then they changed again and now everything is back to $19.88 type pricing.
  31. SighTurtle

    SighTurtle [H]ard|Gawd

    Jul 29, 2016
    Tbh, my experience with all 3 carriers is nothing but positive. Guess its just the luck of the draw in terms of personnel.
  32. thesmokingman

    thesmokingman [H]ardness Supreme

    Nov 22, 2008
    It's funny, I think USPS is definitely faster because they just throw packages over our wall now instead of walking them to the door.
    sleepeeg3 likes this.
  33. Mchart

    Mchart 2[H]4U

    Aug 7, 2004
    People saying fedex is shit haven't used it much for mission critical stuff / international. This is where they shine, and if you are willing to pay for it they will do it right.

    UPS is arguably the worst. They suck for mission critical and international, and I've had all sorts of issues over there years with them.

    USPS I've never had issues with, and I send/receive packages daily. The issue with USPS is if you have to send international and deal with shit other country carriers / customs.