Business Law Question

Planning for the Surge:
How Do Amazon, UPS, and FedEx Manage Peak Seasons?

(adapted from Principles of Management, Rice University, OpenStax)
Typically, the day after Thanksgiving (Black Friday) marks the beginning of the holiday shopping season in the United States. Holiday sales, typically defined as sales occurring in November and December, account for roughly 30 percent of annual sales for U.S. retailers (Holiday Forecasts and Historical Sales, 2015). For 2016, total online sales from November 10 to December 31 amounted to 91.7 billion dollars. And the top retailers for this period were eBay, Amazon, Walmart, and Target (Tasker, 2016). The growth in online sales appears inevitable, but how do the top shippers, UPS and FedEx, manage the sudden upsurge?

Not always so well. In 2013, both FedEx and UPS underestimated holiday demand, and with bad weather conditions as well, struggled to deliver packages as promised. Since then, both carriers have worked hard to keep adequate resources available to handle the end-of-year upsurge. But in 2014, UPS overcompensated and had too much capacity, once again damaging profitability (Livengood, 2017).
Matching retailer expectations to reality is a challenge, and not just for the shipping companies. Although retailers would prefer to know how much to expect in sales, forecasts will be inaccurate, sometimes wildly so. In preparing its forecast for the 2017 peak season, Logistics Management examined economic factors, such as GDP, job growth, retail sales, and inventory levels. It also looked at imports. An informal survey of logistical professionals found that 93.5 percent expect the 2017 season to be the same as 2016 (35.5 percent) or more active (58 percent) (Berman 2017).

In June 2017, UPS announced that it would be adding a surcharge to some peak season rates. According to the UPS website, “During the 2016 holiday season, the company’s average daily volume exceeded 30 million packages on more than half of the available shipping days. In contrast, on an average non¬peak day, the company ships more than 19 million packages” (UPS Establishes New Peak Shipping Charge, 2017). The rate for the 2017 peak season would apply to select services and to oversize shipments, primarily (UPS Establishes New Peak Shipping Charge 2017). Analysts see the surcharge as a signal that UPS is the rate setter in parcel delivery. Such an assessment is not surprising given that the increase in parcel delivery as an outcome of increased e-commerce is seen as a core driver of earnings for UPS (Franck, 2017).

Second-ranked FedEx, in contrast, announced that it would not follow suit but instead would “forgo most holiday surcharges on home deliveries this year” (Schlangenstein, 2017). The surcharges levied by UPS are aimed primarily at small shippers, not the larger contract shippers. By not adding a seasonal surcharge, FedEx might hope to capture sales from individuals and small businesses that are deterred by the UPS surcharge (Schlangenstein, 2017).

Kevin Sterling, a Seaport Global Holdings analyst, believes that FedEx has the existing capacity to absorb additional ground shipments. “[FedEx is] going to let UPS be Scrooge at Christmas” (Schlangenstein, 2017). UPS already has a contract with Amazon, the de facto behemoth of online shopping, for normal shipping, leaving room for FedEx to pick up the slack during the holiday rush (Schlangenstein, 2017).

In contrast, UPS reports that the additional charge is needed to offset the costs of additional resources necessary to achieve expected upsurges in capacity. UPS spokesperson Glenn Zaccara commented, “UPS’s peak season pricing positions the company to be appropriately compensated for the high value we provide at a time when the company must double daily delivery volume for six to seven consecutive weeks to meet customer demands” (Schlangenstein, 2017).

With or without surcharges, price structures at both companies strive to discourage shipment of heavy, odd-sized, or oversized packages because such packages won’t flow through either company’s sorting systems and require special handling. All the same, FedEx has seen a 240 percent increase in such shipments over the last 10 years, which make up roughly 10 percent of all packages shipped using its ground services. And although FedEx is not adding a holiday surcharge, per se, it has added charges for packages that require extra handling, particularly shipments between November 20 through December 24 (Schlangenstein, 2017).

And the global pandemic of 2020 didn’t help the situation.  “Salesforce … says global digital orders continued to grow after Cyber Monday (Nov. 30), peaking to 71% growth year over year on Dec. 5 before slowing down on Dec. 7” (Evans, 2020).  One logistics-saving innovation continued expansion during 2020 to help save valuable last-mile transportation resources:  curb-side pickup.  This ecommerce tool leverages on-line ordering with safe, social-distancing customer pickup. “Retailers with curbside pickup particularly benefitted, Salesforce adds. Digital sales Dec. 1–Dec. 14 grew 52% year over year for U.S. retailers that offered curbside, drive-thru and in-store pickup options” (Evans, 2020).

Increased customer demand for holiday shipping created the perfect-storm, with the pandemic drastically hitting transportation supply at the same time. “Nearly 19,000 of the [United States Postal Service’s] 644,000 workers are under quarantine after testing positive for the virus or after a close exposure, according to the American Postal Workers Union” (Bogage & Denham, 2020).  It wasn’t unexpected but it was rather unprecedented when “FedEx and UPS enacted restrictions on large-volume retail shippers in early December, according to industry tracking firm ShipMatrix. For the week of Dec. 6, FedEx delivered 93.9 percent of its parcels on time, UPS delivered 96.1 percent, and the Postal Service, 87.5 percent” (Bogage & Denham, 2020).  To many, however, the number of lost and delayed packages seemed even greater.  It appears that Amazon’s investments for additional in-house personnel, trucks, sorting centers and even cargo aircraft paid off in 2020, as they claimed Prime Members could still shop for most items through Dec 23 or even Dec 24 (Steiner, 2020).  When next day just isn’t good enough, many consumers are now willing to pay for two-hour delivery!

The year 2021 is even worse.

Case Study Questions: (edited from original text)

Choose one of the three companies discussed in this Case Study (Amazon, UPS or FedEx).  Introduce the business situation.

From outside of the Case Study using open sources, find the Vision and Mission for your selected company.  Present them with a brief critique based on your knowledge of proper statements.

Create just the start of a SWOT analysis, by identifying TWO items in each quadrant to create a SWOT table. Write a brief discussion.

Plan for next year’s surge! Follow the 5 Step Planning process to provide your recommendations in each step.  Use general statements in your response, not detailed corporate plans that could be hundreds of pages long.

Conclude with your recommendation for a specific, difficult goal that clearly communicates your strategic plan to the entire workforce.


Business Situation: FedEx

FedEx is one of the world’s largest courier delivery services companies, providing express mail, freight forwarding, and logistics services globally. The company faces challenges during peak seasons, such as the holiday rush, where it must manage increased package volumes while maintaining service quality.

Vision and Mission:

  • Vision: “To be the global leader in logistics, connecting people and possibilities everywhere.”
  • Mission: “To provide unparalleled service, reliability, and innovation in transportation and logistics solutions.”

Critique: The vision statement effectively communicates FedEx’s aspiration to be a leader in logistics and connectivity, aligning with its global presence and commitment to innovation. However, it lacks specificity and could be more focused on the unique value proposition that FedEx offers. The mission statement emphasizes service, reliability, and innovation, which are core values for a logistics company. However, it could be more concise and specific about the company’s target market and strategic priorities.

SWOT Analysis:


  1. Global Presence: FedEx has a widespread network of operations, including international shipping capabilities, enabling it to serve customers worldwide.
  2. Technological Innovation: The company invests in advanced technology and automation to enhance efficiency and service quality, staying ahead of competitors.


  1. Overreliance on Air Freight: FedEx heavily relies on air freight for its delivery services, making it vulnerable to disruptions due to weather conditions or airspace restrictions.
  2. High Operating Costs: The company’s extensive infrastructure and investment in technology contribute to high operating costs, affecting profitability.


  1. E-commerce Growth: The rapid growth of e-commerce presents opportunities for FedEx to expand its parcel delivery services and logistics solutions.
  2. Emerging Markets: Expansion into emerging markets, such as Asia-Pacific and Latin America, offers potential for revenue growth and market penetration.


  1. Intense Competition: FedEx faces competition from established players like UPS and emerging disruptors in the logistics industry, putting pressure on pricing and market share.
  2. Regulatory Challenges: Changing regulations, trade policies, and environmental regulations may impact FedEx’s operations and increase compliance costs.

Plan for Next Year’s Surge:

  1. Assess Current Capacity: Evaluate the company’s current infrastructure, resources, and technology to identify areas for improvement and investment.
  2. Forecast Demand: Analyze historical data, market trends, and customer insights to forecast peak season demand accurately.
  3. Enhance Operational Efficiency: Implement process improvements, automation, and technology upgrades to streamline operations and increase throughput.
  4. Expand Network Capacity: Invest in expanding capacity, including sorting facilities, transportation fleets, and last-mile delivery capabilities, to handle increased volumes effectively.
  5. Collaborate with Partners: Strengthen partnerships with suppliers, retailers, and other stakeholders to improve coordination and collaboration throughout the supply chain.

Strategic Goal: Implement a comprehensive peak season strategy to achieve a 98% on-time delivery rate during the holiday rush, ensuring customer satisfaction and maintaining FedEx’s reputation for reliability and excellence in logistics services.

Calculate the price
Make an order in advance and get the best price
Pages (550 words)
*Price with a welcome 15% discount applied.
Pro tip: If you want to save more money and pay the lowest price, you need to set a more extended deadline.
We know how difficult it is to be a student these days. That's why our prices are one of the most affordable on the market, and there are no hidden fees.

Instead, we offer bonuses, discounts, and free services to make your experience outstanding.
How it works
Receive a 100% original paper that will pass Turnitin from a top essay writing service
step 1
Upload your instructions
Fill out the order form and provide paper details. You can even attach screenshots or add additional instructions later. If something is not clear or missing, the writer will contact you for clarification.
Pro service tips
How to get the most out of your experience with Boom Grades
One writer throughout the entire course
If you like the writer, you can hire them again. Just copy & paste their ID on the order form ("Preferred Writer's ID" field). This way, your vocabulary will be uniform, and the writer will be aware of your needs.
The same paper from different writers
You can order essay or any other work from two different writers to choose the best one or give another version to a friend. This can be done through the add-on "Same paper from another writer."
Copy of sources used by the writer
Our college essay writers work with ScienceDirect and other databases. They can send you articles or materials used in PDF or through screenshots. Just tick the "Copy of sources" field on the order form.
See why 20k+ students have chosen us as their sole writing assistance provider
Check out the latest reviews and opinions submitted by real customers worldwide and make an informed decision.
english comp
Great paper and done before the deadline. Thank you
Customer 452509, June 15th, 2021
english comp
Thank you for all your hard time.
Customer 452509, June 27th, 2021
Classic English Literature
Awesome Job... you are the best!
Customer 452531, November 27th, 2021
Great content.
Customer 452549, February 8th, 2022
English comp
Got a 94% thank you!
Customer 452509, June 27th, 2021
English 101
perfect! thanks!
Customer 452543, December 1st, 2021
Classic English Literature
Absolutely LOVE the essay I received. I really appreciate it so much.
Customer 452529, October 25th, 2021
Classic English Literature
Great Work as Usual. Thank you . I received an A on the paper!
Customer 452531, November 9th, 2021
Thank you so much this looks great !!!!
Customer 452585, November 4th, 2023
Exercise Science
Thank you so much for your time.
Customer 452545, December 5th, 2021
Absolutely LOVE having help especially from the person who wrote this last one. THANK YOU
Customer 452529, November 19th, 2021
world civilization
Thank you for the quick response
Customer 452509, June 27th, 2021
Customer reviews in total
Current satisfaction rate
3 pages
Average paper length
Customers referred by a friend
15% OFF your first order
Use a coupon FIRST15 and enjoy expert help with any task at the most affordable price.
Claim my 15% OFF Order in Chat