Jay's Parcel Notes: Jan 22 - Feb 5

I’m Jay Kent, managing director of SLB Performance, a consulting firm that helps companies reduce supply chain costs, implement BI tools, and improve in-stock and customer service. After 25 years of leading some of the most complex supply chains in the industry, I began advising companies in multiple industries and verticals. It’s important to understand the market to mitigate costs and improve efficiencies. So, twice a month, I’ll share parcel news and thoughts. Be sure to hit the subscribe button to receive the latest newsletter in your LinkedIn notifications.

I'll be at RILA's LINK: The Retail Supply Chain Conference Feb 16-19. If you plan to attend as well, drop me a line and let's meet up!

• Walmart is ramping up GoLocal, its white-labeled last-mile delivery service and is looking to expand into B2B deliveries. GoLocal’s list of partners includes such retailers as 1-800 Flowers, Books-A-Million, Hibbett, Sur La Table, UrbanStem and Sally Beauty.
• The use of de minimis for packages from China to the US ends, for now. The U.S. Postal Service announced it would stop accepting parcels from China and Hong Kong. The move comes after the Trump administration imposed new tariffs on China and moved to close a loophole that allows companies to avoid paying tariffs if they ship packages worth less than $800 directly to U.S. consumers.
• Italian tax police seized 46.6 million euros ($48.4 million) from FedEx's local unit, FedEx Express Italy srl, following an investigation into alleged tax fraud linked to illicit labor supply.
• USPS offers ‘little convincing evidence’ its reform plans will succeed according to a PRC advisory opinion. “The commission urges the Postal Service to reconsider whether the speculative, meager gains from this proposal outweigh the certain downgrade in service for a significant portion of the nation,” PRC wrote.
• Members of the National Association of Letter Carriers (NALC) voted to reject a tentative agreement with the U.S. Postal Service. The NALC reached a tentative agreement regarding the proposed 2023-2026 National Agreement on Oct. 17.
• Veho announced its expansion into Richmond, Virginia and Louisville, Kentucky. According to Veho, it now serves over 105 million Americans across 44 markets.

UPS Earnings

UPS announced its Q4/YE 2024 earnings last week. As part of the announcement, UPS in-housed its SurePost service and plans are underway to reduce its Amazon volume by half by June 2026. UPS network, as a result, will shrink to match the lower anticipated volume. A number of stories have been written about all of this. Here are a few:

• Bloomberg - ‘Control of Our Destiny’: UPS Braves Blowback Over Amazon Break
• Supply Chain Dive - UPS to cut Amazon volume by more than 50%
• Supply Chain Dive - UPS SurePost changes put shippers at a crossroads
• Transport Topics - UPS Posts 1.5% Revenue Growth; Shares Fall on Amazon Deal

In our latest video chat, Cathy Morrow Roberson and I discuss UPS' earnings, the parcel market and share tips on how to mitigate costs.

That’s it for now. For more, be sure to sign up for our twice a week email newsletter. Reach out if you'd like to learn how to lower or even possibly eliminate any parcel fees.

Stay tuned for the next newsletter on Feb 5. Don't forget to hit the subscribe button to ensure you receive it in your LinkedIn notices. In addition, if you like what you're reading, sign up to receive additional insights and analysis via emails twice a month - DM me for more info.

-Jay