CNF Transportation, the parent company of Emery Worldwide, Palo Alto, CA, the delivery services company commissioned by the USPS for its additional Priority Mail contracting plants, reported lower-than-expected revenues in air freight and start-up costs for Emery's Postal Service Priority Mail Contract.
As a result, CNF most likely will announce lower-than-expected earnings during the company's first quarter, which ended March 31. In addition, the Emery Worldwide subsidiary is experiencing essentially flat revenues in comparison with the first quarter a year ago and fell substantially short of the sales growth that was expected. It also posted a small loss in the first quarter. The company declined to provide exact figures.
In a prepared statement, CNF president Dan Moffitt said Emery's earnings expectations fell short because the "decision to extend the opening date for the remaining postal sortation hubs into June will increase the company's cost, but in the long run, will provide a better opportunity for service and profitable growth."
USPS Courts Hi-Tech Market
To capitalize on the growth of electronic commerce, the U.S. Postal Service has been working the hi-tech trade show circuit across the country this year. The agency's marketing team travels to 15 trade shows each year, explaining to exhibitors that many of the products being sold online -- including books, CD-ROMs and software -- are delivered to consumers via the mail.
At last months's Internet World in Los Angeles, the spotlight was on shipping services. Staffers explained that the USPS' low prices can make a big difference to Internet firms -- many of which are young and have limited cash resources.
Packagenet Develops Network
Packagenet, Fairfield, IA, which provides shipping and catalog-return services from counters inside 4,000 supermarkets, announced the development of a "Depot Network" to allow carriers such as RPS, FedEx or UPS to increase their residential deliveries. These carriers are doing less residential shipping today because of costs.
Many of these carriers think delivering one package can be much more expensive then stopping at a commercial destination and delivering 10 or 50 of them.
E-commerce vendors will have a database of Depot Network locations incorporated into their Web sites. A visitor entering the "shipping section" of the Web site will be able to choose whether or not to have a package sent to his or her home, or to one of several nearby Depot locations.
The system also will be linked into the major carriers' tracking systems, so customers will be able to tell when that package left the merchant and when it arrived at the supermarket. Catalogers who are not yet online also can tell customers about their choices over the telephone.
E-commerce customers who choose a Depot Delivery from a merchant's site will pay about a $3 premium over standard shipping charges.
"This network was developed to help carriers solve the 'stop cost' problem they are experiencing, by letting them deliver packages to a whole neighborhood at an aggregation point of delivery," said Kenneth Ross, chairman and chief executive of Packagenet. "In addition, we believe it will help e-commerce because carriers may cope with this increase in residential delivery by increasing their residential rates, thereby possibly killing off the prospect of a growing e-commerce industry."
Study: Overnight Mail on Time
The U.S. Postal Service announced last week that residents of Harrisburg, PA, and Erie, PA, received 96 percent of their overnight mail on time. The study, commissioned by Price Waterhouse, Washington, measured USPS' overnight First-Class mail-delivery service performance for December 1997 through February 1998 in 96 locations. Overall, the study found that 93 percent of overnight First-Class mail was delivered on time.
Guide Recommends Airborne
The Business Consumer Guide, Seattle, has recommended Airborne Express, Montvale, NJ, for overnight and next-afternoon shipment of letters and packages weighing as much as 1 pound anywhere in the United States for the fourth year in a row.
Beacon Research Group Inc., Watertown, MA, conducted the study of major shippers. For the first time, Airborne also was recommended for overnight delivery of packages weighing up to 6 pounds and traveling more than 300 miles.
UPS Debuts Document Service
United Parcel Service recently announced its UPS Document Exchange service. The suite of document delivery and management services expands the company's core parcel delivery business to include secure electronic delivery over the Internet.
Available in the second quarter, the service will provide encryption, user authentication, password protection, proof of delivery, tracking, archiving and receipt confirmation. Industry watchers are saying the service could be a strong competitor to traditional communication mediums such as mail.