Package Carriers Building Up for E-Commerce Delivery

Posted on November 14, 2016

UPS, FedEx are adding bigger parcel hubs for faster distribution for online retailers

Parcel delivery companies are getting closer to online retailers—literally.

The package-delivery operations at FedEx Corp. and United Parcel Service Inc. have been opening more and larger sorting facilities that are readily accessible to their customers—shortening the often time-consuming first leg of a shipment, from e-commerce fulfillment center to shipping hub.

This week, UPS announced plans to open its third-largest facility yet, part of a “multiyear” investment plan to expand and modernize its network. Located near the Fulton County Airport-Brown Field just outside Atlanta, the $400 million, 1.2-million-square-foot distribution center will be highly-automated and capable of handling more than 100,000 packages an hour, according to a company statement.

The addition comes as FedEx’s Ground division has added more than 12 million square feet of package-sorting space since last year, including four major distribution hubs and 19 fully-automated facilities. One hub FedEx Ground opened outside Pittsburgh in September is 300,000 square feet and uses automated systems that can handle 15,000 packages an hour.

The two company’s ground operations, along with the U.S. Postal Service, are the delivery businesses that are growing most rapidly from the surge in online sales.

Continue reading full article on Wall Street Journal.