Online orders are expected to surge this week, with Christmas just seven days away and many retailers still pushing e-commerce deals. And some companies, including Amazon and Walmart, are extending shipping deadlines, giving procrastinators a way to buy online this week and still have items arrive before Dec. 25.
With more digital orders funneling through the system this holiday season compared with last, it appears UPS, FedEx and the U.S. Postal Service are more prepared than ever to handle a spike in activity. That should come as good news for shoppers and retailers.
For the first three weeks of the holiday season, FedEx's on-time delivery performance was at 95.1 percent, UPS was at 97.6 percent and the USPS 97.8 percent, according to data from logistics solutions provider ShipMatrix, which looks at millions of parcels shipped from over 90,000 locations across the U.S.
ShipMatrix President Satish Jindel said these are the highest rates he's seen in years. And he expects it will maintain this pace over the remainder of the month, or maybe even go higher, as some 95 million packages are expected to go out daily to consumers this week, compared with 45 million during a "nonpeak" time of year.
"The carriers are handling that increase without much impact week after week," Jindel told CNBC, adding he expects FedEx's on-time performance rate to rise about 2 points this week to be more in line with rivals. "Thursday and Friday especially are going to be busy days for them."
Last-minute options for online shoppers
The stronger performance by carriers could be giving retailers greater confidence to extend shipping deadlines.
Amazon said last week it would extend its offer for free holiday shipping, with no minimum purchase or Prime membership required, through Dec. 18. The option was previously set to end Dec. 14. Prime members in certain markets can receive free same-day delivery through Christmas Eve — Monday.
Walmart then said that for select items and store locations, shoppers will be able to order online as late as this Saturday and have purchases arrive before Christmas. For a larger selection of merchandise, the company has a 2 p.m. cut-off time on Thursday for delivery by Christmas Eve. The Dec. 22 option is new this year for Walmart, a spokeswoman confirmed to CNBC.
And Target said this week that, for the first time, it's promising that eligible orders placed online through Thursday will arrive, with no shipping fee, by Christmas Eve. Members of Target Shipt will be able to order certain items up until two hours before some stores close Dec. 24 for same-day delivery.
"Amazon's move to extend its holiday shipping terms reflects growing competition among retailers for fast, inexpensive shipping," Jefferies analyst Randal Konik said. "This dynamic has only escalated throughout the holiday season, with retailers both small and large lowering their free-shipping thresholds and offering expedited options."
While retailers are giving shoppers more time to buy online this holiday season, they're also trying harder to encourage customers to pick their internet orders up at a store.
This week, Walmart will let shoppers place orders on its website up until 4 p.m. Sunday, and they can then pick those items up in stores until 5 p.m. Monday. Target said shoppers can order through 6 p.m. Christmas Eve and pick online orders up by the time their local store closes that day. That's for the true procrastinators.
Record volumes anticipated
Retailers have some more flexibility thanks to the investments in automation carriers like UPS and FedEx have made this year, Jindel said. He said he's been visiting carriers' facilities across the U.S. where, robots are in place to help sort packages and remove some of the strain on human labor. "Even human beings have limitations," he said.
A FedEx spokeswoman told CNBC the company expects to move "a record number of packages" this year, with the Mondays between Black Friday and Christmas being the busiest in the company's history. "With more than 425,000 dedicated team members, the strength and reach of our global network, and a significant investment in our facilities and fleet, we are well-positioned to meet this record demand," she said.
UPS, meanwhile, is anticipating its volume of packages delivered this holiday season to be up about 3.6 percent from 762 million in 2017, according to a company spokesman. He said the company is off to a "good start." The carrier said earlier this year it expected to add 100,000 temporary workers for the peak season, up more than 5 percent from last year.
The Postal Service said it's expecting to process and deliver roughly 3 billion pieces of mail, including packages, this week alone.