FedEx expects December 12 to be the busiest day in the company’s history, with over 17 million shipments. The company projects a ten percent increase from a year ago, driven by its SmartPost product, which uses the US Postal Service to deliver the shipments to customers’ homes:

MEMPHIS, Tenn., Oct. 24, 2011 – FedEx Corp. (NYSE: FDX) expects to move more than 17 million shipments – almost double its daily average volume – through its global networks on December 12, the projected busiest day in company history. The 10 percent year-over-year increase will be driven by FedEx SmartPost, a residential shipping service designed for online and catalog retailers, as well as expected increased volume at FedEx Ground and FedEx Home Delivery.

Between Thanksgiving and Christmas, FedEx forecasts more than 260 million shipments to move through its worldwide shipping networks. This is a 12 percent increase for the holiday season over last year when 232 million shipments were processed.

“As e-commerce continues to grow and demand increases with more customers shopping and conducting their business online, FedEx SmartPost is poised to handle the increase in shipments,” said Frederick W. Smith, chairman, president and CEO of FedEx Corp. “More than 290,000 FedEx team members also stand ready to deliver the holidays and enable commerce around the globe.”

Retail inventory such as apparel, personal consumer electronics and luxury goods as well as books and other items from large, internet retailers will account for a large portion of FedEx holiday volumes.

FedEx will increase its workforce by approximately 20,000 with seasonal positions to help handle the surge in holiday shipments at FedEx Ground, FedEx Home Delivery and FedEx SmartPost.

The impact of the expected higher volumes was included in the company’s earnings guidance issued in September.

The Holiday Retail Outlook

Holiday sales are expected to grow 2.8 percent during November and December to $465.6 billion, according to the National Retail Federation (NRF). This is higher than the average increase of 2.6 percent over the last ten years.

The NRF also reports that nearly half of shoppers (46.7%) will buy online as compared to 43.9% in 2010. According to eMarketer, holiday online shopping will increase by 12 percent during the 2011 season.

Poised for E-commerce . . . FedEx SmartPost

The FedEx SmartPost network is designed for online retailers and cataloguers who ship high volumes of low-weight shipments to residential customers. FedEx SmartPost has an integrated national network that picks up, sorts and delivers packages directly to U.S. Postal Service facilities for final delivery to residences.

The service continues to experience significant growth. As reported in first quarter earnings ended August 31, FedEx SmartPost average daily volume increased 29 percent due to growth in e-commerce and gains in market share.

Husch Blackwell’s Postal Service Contracting practice group today released its list of the top 150 U.S. Postal Service suppliers for fiscal year 2010, and for the eighth straight year FedEx claimed the No. 1 spot with Northrop Grumman jumping from fourth to second. The list is compiled by David P. Hendel, a partner in the firm who has served clients’ postal contracting needs for 29 years. This is the 15th year for the list.

First-place FedEx transports Express, Priority and First Class Mail, and earned postal revenues of $1.372 billion in fiscal 2010 – falling slightly from the $1.4 billion it earned in fiscal 2009. Another postal competitor, United Parcel Service, is the Postal Service’s 11th largest postal supplier, earning $95 million in revenue – a $12 million increase from last year.

“Once again, transportation and technology providers stand atop the list of the Postal Service’s largest suppliers,” said Hendel, who compiles the list from information obtained under the Freedom of Information Act. “But unlike last year, in fiscal 2010 more top suppliers had declines rather than gains in postal revenues.” The sharp decline seen in postal spending over the previous several years has stabilized; spending in FY 2010 totaled $12 billion, a 1 percent decrease over FY 2009. By contrast, postal spending in FY 2009 declined more 19 percent from FY 2008.

Second-place automation supplier Northrop Grumman earned $494 million in postal revenues. Northrop Grumman provides automation design, equipment fabrication, field deployment and logistics support to the Postal Service.

Other companies in the top 10 include third-ranked Kalitta Air, an air transportation and mail distribution service for military mail bound for Iraq and Afghanistan; trucking contractor Pat Salmon & Sons, Inc. in fourth place; systems manufacturer Siemens in fifth; computer company Hewlett-Packard in sixth; transportation company Wheeler Bros., Inc. in seventh; advertising agency Campbell-Ewald in eighth; consulting company Accenture in ninth; and the number 10 spot was secured by technology company IBM.

“Opportunities for facility contractors continue to decline in 2011 as the agency is unlikely to build many new facilities in a time of decreasing mail volume,” Hendel said. “But opportunities do exist for modifying existing facilities and retrofitting facilities for energy conservation purposes.”

Other trends identified in FY 2010 figures:

* Increased spending on ground transportation – up 5.3 percent from FY 2009
* Decreased spending on domestic air transportation – down 2 percent
* Decreased spending on international air transportation – down 26 percent
* Spending on supplies and services remained stable

Click here to view the full list of the top 150 suppliers to the U.S. Postal Service in 2010.

The firm’s Postal Service Contracting group assists clients in contracting with the U.S. Postal Service, and its members are knowledgeable regarding the needs specific to the postal industry. Hendel has developed and presented several training courses on postal contracting. He also writes a monthly column on postal contracting issues for the National Star Route Mail Contractors Association. He has represented hundreds of postal contractors on a wide range of issues.

I know you’re thinking “didn’t they just raise their rates?”, but yes, it’s true, FedEx is upping it’s prices again, and by a whopping 4.9%! It seems every year at this time we get the Christmas present of yet another round of price hikes by FedEx and UPS! It’s a classic example of how government can’t be trusted to do things better left to the free market! Isn’t it about time Congress privatized both of them?

Oh wait… Never mind!

FedEx Corp. (NYSE: FDX) will increase shipping rates for FedEx Ground and FedEx Home Delivery by a net average of 4.9% effective January 3, 2011.

The FedEx Ground and FedEx Home Delivery full average rate increase of 5.9% will be partially offset by adjusting the fuel price threshold at which the fuel surcharge begins, reducing the fuel surcharge by one percentage point. FedEx SmartPost rates also will change.

FedEx previously announced on Sept. 29, 2010 that it will increase shipping rates for FedEx Express also effective January 3, 2011 and that FedEx Express and FedEx Ground will implement a change to the dimensional weight volumetric divisor from 194 to 166 for U.S. domestic services.

Details of dimensional weight charges, surcharge changes and new rates can be found at www.fedex.com/us/2011rates.

Note: It’s a bit ironic that the photo accompanying this FedEx press release shows a FedEx delivery truck, since FedEx SmartPost items are delivered by the US Postal Service…

MEMPHIS, Tenn., Nov. 11, 2010 – FedEx Corp. (NYSE: FDX) expects to see its busiest day in company history when it moves almost 16 million shipments around the world on December 13. This is a more than 12 percent increase from last year’s busiest day when the company handled 14.2 million shipments.

For the overall holiday season, FedEx is expecting a total volume increase of approximately 11 percent compared to 2009. FedEx forecasts more than 223.3 million shipments will move through its global networks between Thanksgiving and Christmas.

More than half of the holiday season volume increase will be from FedEx SmartPost shipments. FedEx SmartPost volume is largely driven by online retailers and cataloguers who ship high volumes of lighter shipments to residential customers. FedEx SmartPost has a completely integrated national network that picks up, sorts and delivers packages directly to U.S. Postal Service facilities for final delivery to residences. The affordable rate structure allows retailers to offer discounted shipping to customers during the holidays and beyond.

During the week of December 13, also the busiest week of the year for FedEx, the company expects to move more than 63.1 million shipments compared to last year’s busiest week of 57.5 million shipments. Items such as books from large internet retailers and retail inventory such as apparel, personal consumer electronics and luxury goods will drive FedEx holiday volumes.

“Once again, the FedEx work force of more than 285,000 team members will make the holidays happen for millions of FedEx customers across the globe,” said Frederick W. Smith, chairman, president and CEO of FedEx Corp. “We are optimistic about the volumes during the holiday shipping season and expect growth to be driven mainly by FedEx SmartPost with U.S. domestic ground packages and global air express shipments contributing to volumes as well.”

On average, more than 8 million packages move through the FedEx systems daily.

The FedEx Outlook

FedEx is encouraged by the anticipated increase in holiday volume. The impact of the expected higher volumes was included in the company’s earnings guidance issued in September.

The Holiday Retail Outlook

According to the National Retail Federation (NRF), holiday sales are expected to increase a moderate 2.3 percent this year to $447.1 billion. This growth is slightly lower than the ten-year average holiday sales increase of 2.5 percent. In 2009, sales increased 0.4 percent. NRF also found that retailers will continue to focus on supply-chain efficiencies and inventory control.

Online holiday sales are forecast to climb 15 percent compared to last year according to the research and consulting firm Deloitte.

FedEx Ground . . . For the Holidays and Beyond

Year over year, FedEx Ground volumes on its busiest day are expected to increase by 1.8 million packages. Approximately 50 percent of this increase is due to volume growth at FedEx SmartPost.

Retailers, cataloguers and other customers are increasingly discovering the unique value proposition available for high volume, lightweight residential packages offered by FedEx SmartPost.

“All three of our ground services continue to grow and attract new customers based on our outstanding overall service and unique attributes,” said David Rebholz, president and CEO of FedEx Ground. “One major factor is speed, as FedEx Ground is faster to more overall locations and FedEx Home Delivery is faster to more residential locations than UPS Ground.”

FedEx Ground continues its nationwide network expansion to boost daily package volume capacity and further enhance the reliability, speed and service capabilities of its network.

The network enhancements have resulted in accelerating ground service delivery by one day or more in approximately two-thirds of the United States since 2003. FedEx Ground now delivers more than 61 percent of packages in two days or less and more than 82 percent of packages in three days or less.

FedEx Busiest Day of the Year . . . A History of Growth

FedEx has experienced steady growth in holiday volumes over the last several years. A historical breakdown of busiest day volumes follows:

• Dec. 12, 2005 – 9.8 million shipments

• Dec. 18, 2006 – 10.6 million shipments
• Dec. 17, 2007 – 11.5 million shipments
• Dec. 15, 2008 – 12.0 million shipments
• Dec. 14, 2009 – 14.2 million shipments
• Dec. 13, 2010 – 16.0 million shipments projected

FedEx said Thursday that its first quarter profits were double what they were a year ago. Despite that, its stock price fell on a soft outlook for the second quarter. In addition, the company announced that it would merge its FedEx Freight and FedEx National LTL operations, closing 100 facilities and eliminating 1,700 jobs.

FedEx attributed its revenue growth to “strong FedEx International Priority(IP) growth at FedEx Express, continued growth at FedEx Ground and a benefit from the net impact of higher fuel surcharges.”

Much of the FedEx Ground growth came from its FedEx SmartPost product, which uses the USPS for residential deliveries. The company said SmartPost average daily volume “increased 9%, with net yield increasing 19%. The increase in FedEx SmartPost yield was primarily due to lower postage costs as a result of increased deliveries to U.S. Postal Service final destination facilities and increased fuel surcharges.”

The US Postal Service Inspector General has found that the USPS is paying FedEx to transport and sort First Class Mail that could have been handled more cheaply by surface transport, the airlines, and postal employees. The audit covered transportation costs in the Capital Metro, Eastern, Great Lakes, and Northeast Areas.

The OIG’s report found:

It was more effective and economical in some cases for the Capital Metro, Eastern, Great Lakes, and Northeast Areas to use ground transportation and domestic air carriers as well as to sort mail at Postal Service plants than to use FedEx to perform these functions. Because the areas used FedEx, the Postal Service incurred about $35.3 million in unnecessary costs. If these areas implement our recommended changes, we estimate the Postal Service could save $170.6 million over a 10-year period.

Previous OIG audits identified $390 million in potential unnecessary charges due to the use of FedEx in other areas.

Federal Express – Transportation Agreement – Northeast Areas

WASHINGTON, D.C. – The following is a statement from Change to Win Chair Anna Burger regarding recent speculation that union-busting FedEx CEO Fred Smith is on presumptive Republican presidential nominee John McCain’s short list for vice-presidential picks.

“Recent reports that FedEx CEO Fred Smith is being considered by John McCain as a potential vice-presidential pick are beyond disturbing. As a well-known lifelong union buster, Smith has a disgraceful record of stripping workers of their most basic rights to organize and fight for a living wage. It is disheartening, although not surprising, that John McCain would consider picking such a notorious enemy of hard working men and women to be his running mate.

“In the 35 years that Fred Smith has been the CEO of FedEx he has repeatedly fought against workers joining together to have a voice on the job, openly stating that he ‘doesn’t intend to recognize any unions at Federal Express.’ Less than 2% of the 200,000 American workers at FedEx are in a union. In contrast, UPS unionized workers make nearly 30 percent more than they non-union counterparts at FedEx. Despite organizing efforts, FedEx has filed appeal after appeal to deny their workers the right to bargain collectively, and has sought national legislation to thwart union organizing.

“Americans have already suffered through seven years of a White House that places corporate interests before the interests of America’s working families and we’ve seen the results – millions of homeowners facing foreclosure, gas prices at record levels, and skyrocketing health care costs. Workers cannot afford another lobbyist-dominated administration. A vice-president Fred Smith would be bad for America, and bad for workers. Working families need leadership in the White House that will help them reclaim the American Dream, not a third Bush term.”

About Change to Win
Change to Win is a six million member partnership of seven unions founded in 2005 to represent workers in the industries and occupations of the 21st century economy. Change to Win committed to restoring the American Dream for a new generation of workers – wages that can support a family, affordable health care, a secure retirement, and the opportunity for the future. The seven affiliated unions are: Service Employees International Union, UNITE HERE, United Food and Commercial Workers International Union, International Brotherhood of Teamsters, Laborers’ International Union of North America, United Brotherhood of Carpenters and Joiners of America and United Farm Workers of America.

FedEx Home Delivery has always used contract drivers, operating their own vehicles (with FedEx logos), to make deliveries. Early on, however, some drivers challenged the contractor model, claiming that they were, in reality, employees of the company, and entitled to organize, and bargain collectively with the company.

The controversy intensified in February 2006, when the National Labor Relations Board ruled that drivers at a Massachusetts FedEx facility were entitled to organize. From the Boston Globe:

“What basically was decided here is that FedEx exercises very substantial control over the employees and the way they perform their jobs,” said Bob Redbord , deputy regional attorney at the Boston NLRB office. Redbord said the drivers work to FedEx schedules and follow FedEx driving and delivery guidelines.”

The drivers subsequently voted in the Teamsters as their bargaining agent. While FedEx has said it will challenge the vote, it has also tried another tactic- making nice. The Wall Street Journal reported in December that Fedex

“recently began stationing 18 contractor “advocates,” some pulled from the ranks of contract drivers, across North America. The company says they are responsible for helping drivers increase their shipment volumes, solve problems they might have with management, and other duties. The company also is creating an executive position in charge of contractor relations, reporting directly to the head of the ground unit. FedEx also has increased fuel subsidies to drivers who operate multiple trucks and is eliminating some fines on drivers resulting from customer claims of failed deliveries.

The issue isn’t limited to Massachusetts- according to Traffic World:

The union effort is part of a larger campaign FedEx is facing over the status of some 15,000 FedEx Ground drivers. The company is fighting nearly 30 lawsuits around the country from drivers who say they are illegally denied classification as employees, leaving them without benefits. A California judge last month reaffirmed his earlier ruling in a class action case that drivers who drive single routes should be classified as employees. Several state labor boards also have taken after the FedEx Ground model, saying it circumvents taxes.

One of our customers is shocked when one of his customers reveals shocking news about the USPS! (Whatever you do, don’t tell him about FedEx- it may just put him over the edge!)

Sacramentune: One of my customers…