"FedEx, like global rival United Parcel Service, is investing billions of dollars to cope with the boom in low-margin residential deliveries, which account for just over half of total package volume versus 20 percent in 2000," Reuters reports. "Taking small numbers of packages the 'last mile' to shoppers' doorsteps and far-flung homes is more costly than delivering scads of envelopes and packages to office buildings . . . which has been the Memphis-based company's bread and butter."
John Haber, chief executive of consultancy Spend Management Experts, said FedEx's move is a shift toward the gig economy. He and other consultants said the new drivers could support FedEx's "Extra Hours" service that allows retailers to provide next-day local delivery for online orders. "They've got a ton of Walmart business," Haber told Baertlein. "If these drivers are rural, this fits the Walmart model."
FedEx also recently announced it would start offering Sunday deliveries, with no extra fees, to most U.S. homes to better accommodate online shopping habits, Paul Ziobro reports for The Wall Street Journal. It hasn't made clear what the extent of Sunday delivery will be in rural areas.