The Slatest

UPS Temporarily Stops Picking Up Orders From Six Retailers to Cope With Holiday Surge

A UPS driver stands inside his truck unloading packages.
A UPS driver in San Francisco in July. Justin Sullivan/Getty Images

As coronavirus cases and hospitalizations continue to surge across the U.S., more people have turned to online shopping this holiday season—and delivery services can’t keep up.

On Wednesday, the Wall Street Journal reported that UPS ordered drivers to temporarily stop picking up orders from six retailers after too many packages exceeded the shipping giant’s capacity. The retailers include Gap, Nike, L.L. Bean, Hot Topic, Newegg, and Macy’s. The paper reports that the move, which some drivers say they had not seen in previous holiday seasons, is likely to ensure the service does not take on more than it can handle. It’s unclear how long the restrictions will last.

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A UPS spokesman told CNBC on Wednesday that the carrier had set “specific capacity allocations” for its customers over the holiday season. Retailers were also advised by carriers to spread out online promotions beyond Black Friday, and many started their sales as early as October.

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Both UPS and FedEx upped their shipping rates earlier this year, as many retailers have been bombarded with online sales that have pushed carriers to their limits for most of the pandemic. Last week, Bloomberg reported that UPS and FedEx are scrambling to buy or rent additional delivery vehicles amid the surge. It noted that coronavirus-related shutdowns halted production at factories that build the trucks and vans and that UPS has added peak surcharges to offset rental costs and other increases. Carriers were also adding additional staff: In October, UPS announced it would hire 100,000 workers to accommodate the holiday shipping rush, while FedEx said in September that it planned to hire 70,000.

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According to Adobe Analytics, Thanksgiving saw $5.1 billion in online sales, and Black Friday racked up $9 billion. In-store shopping on Black Friday saw a 52 percent decrease from last year, according to data from Sensormatic Solutions. Cyber Monday brought in $10.8 billion in online sales, a 15 percent increase from last year.

One company that seems to be ready for the holidays: Amazon. Although it struggled to keep up with orders at the beginning of the pandemic, the company prepared for the holidays by hiring 100,000 seasonal employees in September—after adding an additional 175,000 employees in April. It also has spent the past several years building out its own shipping network to rival UPS and FedEx, and it now reportedly delivers two-thirds of its packages through its own carriers.

Retailers are also advising customers to finish their online shopping early to guarantee packages come in before Christmas. So if you want to avoid going to a store in a pandemic and still get your gifts before Christmas, start clicking.

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