US-based courier business, FedEx, is taking steps to increase the efficiency and lower the cost of residential deliveries as e-commerce continues to grow at an explosive rate.
Beginning in March, FedEx Express will contract with FedEx Ground for the transport and delivery of select day-definite, residential Express shipments.
FedEx Express packages will be selected for delivery by FedEx Ground if they are residential deliveries for which FedEx Ground can meet the service commitment. The company will begin rolling this out in Greensboro, N.C. and will include other markets in phases throughout the remainder of the year.
“This move makes residential deliveries more efficient by putting the right package in the right network at the right cost to serve our customers,” said FedEx Corp. President and CEO, Raj Subramaniam.
“We continue to flex our network to stay ahead of ecommerce growth, and that includes adjustments to better handle the demand for residential deliveries while lowering our cost to serve.
“This allows FedEx Express to continue to do what it does best—delivering business-to-business and premium business-to-consumer time-sensitive packages.
The FedEx Express integrated air-ground network is precisely the type of innovative business model that our labor laws are designed to protect. This change leverages the strengths and investments in the FedEx Ground network, making it the network of choice for residential packages fuelled by e-commerce,” he said.
By optimising last mile residential deliveries, FedEx will also help improve safety and sustainability by reducing the number of delivery vehicles in neighbourhoods. This move also enables FedEx to continue to enhance the residential delivery experience by exploring and investing in new last-mile delivery technology and functionality that customers are requesting.