Trouble viewing this email?  View in web browser ›

The Wall Street Journal. The Wall Street Journal.
LogisticsLogistics

Costly Free Delivery; Seeking More Packages; Yellow’s Lending Reprieve

By Paul Page

 

A FedEx worker makes a delivery in Miami Beach, Fla. PHOTO: JOE RAEDLE/GETTY IMAGES

The cost of free shipping is too much to bear for some retailers. A slew of merchants from big department stores to smaller brands are raising thresholds for consumers to qualify for no-cost delivery. The WSJ Logistics Report’s Liz Young writes store owners including Macy’s, Saks Fifth Avenue and Neiman Marcus are among those raising the bar for spending, following on the heels of e-commerce behemoth Amazon, which last year raised the price of its Prime membership. The retailers are responding to rising costs for parcel delivery over recent years that have carved into profit margins for e-commerce sales even as the online business has surged. A big share of merchants say the rising cost of delivering online orders is a major concern at their business. Other retailers are pressing store-pickup services and other strategies aimed at minimizing the number of boxes they hand over to parcel carriers.

  • Nearly 900 Amazon workers at a U.K. warehouse will strike for three days this week over a pay dispute. (Sky News)
 
 

Quotable

“It wasn’t going to last, and finally the party is over.”

— Satish Jindel, president of ShipMatrix, on toughening requirements for free shipping of online orders.
 
Advertisement
LEAVE THIS BOX EMPTY
 

Transportation

A postal facility in Washington, D.C. PHOTO: MICHAEL REYNOLDS/SHUTTERSTOCK

The U.S. Postal Service is angling for a bigger piece of the package-delivery market. The USPS rolled out a rebranded service called Ground Advantage that’s aimed at competing with FedEx and UPS directly on price. The WSJ’s Esther Fung reports the move comes as the fast-rising cost of shipping packages is prompting businesses to look for ways to save money, including cutbacks on free-shipping options for consumers. Parcel volumes have been receding this year, but the big package carriers haven’t taken back the sharp prices they imposed as demand surged over the previous three years. The USPS service changes are part of Postmaster General Louis DeJoy’s broader effort to overhaul operations to address a long-running decline in mail. The USPS will have to win over business shippers who have sidestepped the Postal Service because of the complexity of shipping options and service issues.
 

 
Share this email with a friend.
Forward ›
Forwarded this email by a friend?
Sign Up Here ›
 

Transportation

Yellow has gained a reprieve from its lenders. PHOTO: YELLOW CORP. 

Trucker Yellow has new breathing room from its lenders but still faces pressure on its business on multiple fronts. The embattled company won reprieves from the federal government and from Apollo Global Management on financial targets behind debt totaling nearly $1.3 billion, the WSJ Logistics Report’s Paul Berger writes, but also is saddled with a slew of oversight requirements on its ongoing cash flow. That means the country’s third-largest less-than-truckload carrier still faces a rough road ahead as it seeks a deal with the Teamsters union on an operations overhaul. Yellow’s role in a stumbling freight market may present the biggest challenge for the company. Shipments and revenue were both tracking down in the second quarter after the carrier reported taking in $339 per shipment in the first quarter. Rival ABF Freight, where workers just ratified a contract with the Teamsters, collected about $529 per shipment in the same period.  

  • Several large heavy-duty truck manufacturers agreed to accept California’s ban of traditional diesel-powered trucks by 2036. (Logistics Management)
 
Advertisement
LEAVE THIS BOX EMPTY
 

Number of the Day

$13.79

Cost to ship a 10-pound package via UPS Ground between 600 and 999 miles in the U.S. in 2023, with service charges, up about 58% from $8.71 five years ago.

 

In Other News

Foxconn withdrew from a $19.5 billion joint venture with Indian mining conglomerate Vedanta Group to produce semiconductors in India. (WSJ)

Rivian Automotive’s surge on Wall Street in the past week gives the electric-vehicle maker an opportunity to raise more cash. (WSJ)

Taiwan’s exports plunged 23.4% in June, the steepest decline in nearly 14 years. (Reuters)

The U.K. is set to sign onto an 11-nation Pacific trade agreement this weekend. (Bloomberg)

Bankrupt off-price retailer Tuesday Morning plans to liquidate. (Retail Dive)

Dozens of vessels run by a secretive Indian company at the center of the Russian tanker trade have shifted to new management and ownership. (TradeWinds)

The fire that broke out on a car carrier and killed two firefighters at Port Newark was contained after five days. (WABC)

Maersk Line is slowing its hiring for open positions as it copes with falling shipping profitability. (ShippingWatch)

Drewry projects the global fleet of “smart,” digitally-equipped shipping containers will grow six-fold over the next five years. (Splash 247)

French temperature-controlled logistics specialist Seafrigo moved into air forwarding with the acquisition of U.K.-based PML. (Air Cargo News)

Flexport founder Ryan Petersen was named a partner in venture-capital firm Founders Fund, one of the freight forwarder’s backers. (Forbes)

 

About Us

Paul Page is editor of WSJ Logistics Report. Reach him at paul.page@wsj.com.

Follow the WSJ Logistics Report team: @PaulPage, @bylizyoung and @pdberger. Follow the WSJ Logistics Report on Twitter at @WSJLogistics.

 
Desktop, tablet and mobile. Desktop, tablet and mobile.
Access WSJ‌.com and our mobile apps. Subscribe
Apple app store icon. Google app store icon.
Unsubscribe   |    Newsletters & Alerts   |    Contact Us   |    Privacy Policy   |    Cookie Policy
Dow Jones & Company, Inc. 4300 U.S. Ro‌ute 1 No‌rth Monm‌outh Junc‌tion, N‌J 088‌52
You are currently subscribed as [email address suppressed]. For further assistance, please contact Customer Service at sup‌port@wsj.com or 1-80‌0-JOURNAL.
Copyright 2023 Dow Jones & Company, Inc.   |   All Rights Reserved.
Unsubscribe