Retailers are switching to FedEx Corp. (Nasdaq:FDX) and other courier companies as uncertainty continues to surround whether anything mailed through Canada Post will get delivered.
Mail is currently being delivered and there are reports of progress as negotiations between representatives of Canada Post and its union, the Canadian Union of Postal Workers, continue.
If negotiations fail, either side is still required to give 72-hours’ notice before there is a work stoppage.
“We’ve switched to FedEx,” said Boys’Co. owner David Goldman.
“We were using Canada Post. We did a price comparison and the closest and most economical choice was FedEx. It’s about 5% to 10% more but we’re in the customer service business so we have to accommodate.”
Goldman said that other courier companies might be more competitive had Boys’Co.'s average package size been different.
Indeed other large e-commerce companies are hedging their bets and using multiple courier companies.
“In anticipation of a potential service disruption, Shoes.com took steps more than a week ago to ensure all shipments would be delivered outside of the Canada Post network including upgrading several carrier services, until the potential disruption is resolved,” said Shoes.com CEO Roger Hardy.
“We use a number of different carriers to deliver products and therefore don’t expect customers’ orders to be impacted.”
Amazon.com, meanwhile, is today having its Prime Day, which Citigroup analysts expect to be one of the e-commerce giant’s biggest sales days of the year.
They expect that the one-day sale for members of Amazon's $99-per-year Prime subscription service will generate up to US$1 billion in sales. That’s substantially more than the US$400 million in additional sales that was made during its first Prime Day last year.
On July 11, the Seattle-based retailer announced that it has reinstituted Canada Post deliveries. It had previously announced that it would not be able to ship to P.O. boxes, pick-up points and remote locations.
Other organizations that have essential mail to customers are trying to be innovative.
Vancouver Bike Share, for example, has still ceased its use of Canada Post and is instead asking those who have signed up for year-long memberships at a reduced introductory rate to pick up their membership packages at events, such as the Vancouver Folk Music Festival July 15-17 and the Honda Celebration of Light on July 23, 27 and 30.
