Looking ahead to heavy holiday volumes

When holiday shopping season picks up, December 22 could shape up to be one of its busiest days.

That is what UPS says anyhow.

The industry bellwether announced today that holiday shopping will be at its highest level on December 22, which it said is lined up to be its peak shipping day with projected delivery volume will be in the neighborhood of 26 million packages.

And if that statistic is not enough to quell your curiosity for holiday volumes, UPS came out with others, too.

The company is expecting to see five different days on which deliveries will approach or top the 25 million mark, with all these days occurring within the last ten days before Christmas. Perhaps this is a sign that the economy is improving? If you are asking why, consider the fact that in 2010 UPS only had one day in which deliveries were north of 25 million.

Making the 25 million packages per day estimate even more staggering than it sounds on paper is that UPS pegs this to be about 60 percent higher volume-wise than a typical day, which checks in around 15.6 million and is the equivalent of delivering nearly 300 packages per second.

While UPS is expecting December 22 to be its peak shipping day, it is calling for December 23 to be its peak air day, with air package deliveries to be just about double the output of a typical day at 6 million compared to 3 million. On top of this, UPS will fly more than 400 additional flight segments per day during its peak week, the company said. And in terms of tracking, UPS is expecting to handle more than 58 million online tracking requests on December 20.

The holiday shopping estimates from UPS’s biggest competitor, FedEx, which were released late last month, are also very impressive to say the least. 

The “other” transportation bellwether said this week it expects to move more than 17 million shipments through its global networks on December 12.

If this type of activity occurs, it would represent roughly a ten percent gain over December 13, 2010, when the company moved 15.6 million shipments and it would mark the single busiest day in the company’s history since it began tracking this data in 2005.

Company officials said this gain will be driven by FedEx Smart Post, its “last mile” delivery service partnership with the United States Postal Service, which is primarily spurred by e-commerce, and expected volume increases for FedEx Ground and FedEx Home Delivery.

They added that between Thanksgiving and Christmas, the company is forecasting more than 260 million shipments to be moved through its global shipping networks, a 12 percent annual increase over last year, which hit roughly 232 million shipments.

On top of what both UPS and FedEx are calling for, the National Retail Federation recently said that holiday sales are expected to increase 2.8 percent during November and December to $465.6 billion, marking a higher increase than the 2.6 average over the last ten years.

But before we get too excited looking at that number, the NRF itself said that this is an “average” projection, considering that the annual holiday increase from 2009-to-2010 was 5.2 percent—but that was an easier comparison, given how tough of a year 2009 was for the economy.

What’s more, there remain the headwinds of things like higher gas prices, unemployment, and financial markets that all have the potential to dampen consumer spending activity.

But in any event, FedEx and UPS are calling for holiday growth and that is a good thing. It is obviously hard to tell how close they will come to hitting their respective targets at this point, but it stands to reason they will both at the least come very close.