WMT Walmart Inc

By Paul Ziobro 

FedEx Corp. will deliver packages seven days a week starting next year, adding an extra operating day to accommodate America's online shopping habits.

The delivery giant also plans to carry more of the packages it had deposited into local Post Offices to bring to doorsteps. The shift will build density along FedEx Ground routes to lower costs while also shifting some 2 million packages daily out of the U.S. Postal Service's network.

The changes aim to serve an e-commerce shopping market where consumer habits don't mesh with working schedules, since many deliveries arrive at homes while shoppers are at work. It also adds capacity to FedEx's network by using existing facilities an extra day to handle what the company expects is a doubling of small package shipments in the U.S. by 2026.

The change comes at a time that FedEx's traditional Express business of rushing deliveries by jet across the country or globe has slowed. Amazon.com Inc., Walmart Inc. and many other retailers have expanded their warehouse networks, adding locations near more U.S. cities where they can store goods and ship them shorter distances.

"Expanding our operations to include Sunday residential deliveries further increases our ability to meet the demands of e-commerce shippers and online shoppers," FedEx President Raj Subramaniam said.

FedEx plans to shift to seven-day a week operations in January for a majority of the U.S. population, following the holiday shopping season where it typically delivers packages every day to handle the seasonal surge.

The company didn't disclose the financial impact of its plan.

FedEx this year shifted to six-day-a-week delivery operations after the recent holiday season, an expansion that has added significant costs.

Rival United Parcel Service Inc. in recent years has shifted to six-day a week delivery. During last year's bargaining contract with unionized workers, UPS added lower-tier pay for delivery drivers to work on weekends, although it doesn't currently deliver on Sundays.

A UPS spokesman said the company is "constantly assessing when it makes sense to expand current capabilities and operations."

The U.S. Postal Service, meanwhile, is considering expanding package delivery to seven days a week. It currently delivers packages on Sundays for Amazon.com year round and for other shippers during the holidays.

A USPS spokesman declined to comment.

To build density along routes, FedEx will keep more of the FedEx SmartPost packages it gives to the Postal Service. In recent years, FedEx has used technology to keep such packages in its network if a FedEx driver was headed to a nearby address.

Currently, about 20% of SmartPost packages are delivered by FedEx instead of the Postal service. By the end of 2020, FedEx expects the vast majority of these packages to be integrated into its network.

Write to Paul Ziobro at Paul.Ziobro@wsj.com

(END) Dow Jones Newswires

May 30, 2019 10:21 ET (14:21 GMT)

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